Write 10 pages thesis on the topic financial institution auditing techniques and compliance laws. Gramm-Leach-Bliley Act was introduced in 1999 to protect the financial privacy of the consumers in the financial institutions at the same time introducing reforms in the financial services industry. The act covered financial institutions that are required to protect the privacy of the client’s financial issues. All businesses were expected to be compliant not later than July 1, 2001. The Federal Trade Commission (FTC) and other selected government agencies were directed by the Act with the responsibility of Implementing the regulations of the Act’s financial privacy provisions (GLB Act).
Compliance with the privacy requirement of the Gramm-Leach-Bliley Act is imposed on the financial information’s which are involved in activities of financial nature such as lending, investing, brokering or servicing loans, career counseling, stock exchange dealers among others in the same line of service. Financial institutions are required to uphold the consumer financial privacy and also those persons who come across “nonpublic personal information” which they are not entitled to from any financial institution are limited from using such information without prior authorization from the consumer.
The Gramm-Leach-Bliley Act protects the consumer from the publication of their “nonpublic personal information”. This is the information that the financial institution requires an individual when issuing them with a financial product or service. The privacy act does not cover that information which is publicly accessible. At the time of introducing the consumer-financial institution relationship, the latter should provide the consumer with a privacy notice in written form which is “clear and conspicuous”. The notice lays down the limitations by which the information will be used. This act also forbids financial institutions from giving out their customer’s account numbers which also applies to marketing transactions.