Privacy Law Allows Financial Abuse Reporting
The NCUA and other federal agencies said Sept. 24 that reporting suspected elder financial abuse does not generally violate privacy law.
“Specific privacy provisions of the Gramm-Leach-Bliley Act and its implementing regulations permit the sharing of this type of information under appropriate circumstances without complying with notice and opt-out requirements,” said the Interagency Guidance on Privacy Laws and Reporting Financial Abuse of Older Adults.
Three parts of the act allow financial institutions to report elder abuse to third parties.
“A financial institution may disclose non-public personal information to comply with federal, state or local laws, rules and other applicable legal requirements, such as state laws that require reporting by financial institutions of suspected abuse,” the law said, according to the guidance.
Financial institutions may also disclose personal information to respond to investigations or respond to judicial processes. And, institutions can release personal information to “protect against or prevent actual or potential fraud, unauthorized transactions, claims or other liability.”
Joining the NCUA in issuing the guidance were the Consumer Financial Protection Bureau, the Federal Reserve, the FDIC, the Federal Trade Commission, Office of Comptroller of the Currency and the Securities and Exchange Commission.
“Many older consumers are known personally by the tellers in their local banks and credit unions. These employees may be able to spot irregular transactions, abnormal account activity, or unusual behavior that signals financial abuse sooner than anyone else can,” said CFPB Director Richard Cordray in a Sept. 24 press call. “Today’s guidance makes clear that reporting suspected elder financial abuse generally is not subject to these same concerns and does not violate the Gramm-Leach-Bliley Act.”
NCUA Chairman Debbie Matz said during the press call the regulator will issue a letter to credit unions on the topic.
“We will be encouraging credit unions to review their policies and procedures to ensure they are consistent with state law and the interagency guidance regarding reporting requirements when they suspect elder abuse or financial exploitation,” she said.