Know Your Options
Your financial privacy is important. So how do you know what information your bank is sharing with other companies and what can you do about it? Banks are generally required to give privacy notices when a customer relationship is established, so be sure to read them carefully and know how to opt out of participation. Here are a few things your bank must do to help you maintain your financial privacy.
Privacy notices
Your bank’s privacy notice describes the basic categories of nonpublic, personal information it collects and what it shares with other companies. The notice is intended to help you decide whether or not you want the nonpublic, personal information your bank collects to be shared with companies that are not affiliated with the bank (non-affiliates) and enable you to limit that sharing (to the extent you have the right to do so). A non-affiliate is a company that does not control, is not controlled by, or is not under common control with the Bank.
Not all privacy notices are the same; it is important that you read your privacy notice in order to know what sharing your bank does.
What your bank can share
If your bank plans to share nonpublic, personal information it has from an application, transaction information, and other sources with other companies that are not affiliated with the bank, you may have a right to opt out. Read your notices carefully to see if this opt out applies. Banks can, however, share information about you with other companies, when the information is based solely on your transactions with the bank and the type of accounts you have with the bank.
What your bank can share with non-affiliates
You have the right to opt out or block some nonpublic, personal information sharing with non-affiliates. Banks can share certain types of information about you without giving you opt out rights. For example, your bank can provide the following to non-affiliates if:
- The information is needed to conduct normal bank business. For example, your bank can send personal information to outside firms that help market or deliver your bank’s products that you may not already use.
- The information protects against fraud or unauthorized transactions, or responds to a court order.
- The information is used as part of a “joint marketing agreement.” For example, if your bank and an insurance company agree to jointly offer, endorse, or sponsor the same product or service, the bank may share your information.
- The sharing of the information complies with federal, state, or local requirements.
Opt out
The types of information you have the right to opt out of sharing are stated in your bank’s financial privacy notice. Your bank may allow you to opt out of sharing all information you are entitled to opt out of, or let you select which types of such information you would like to opt out of sharing. For example, your bank may share information like your personal information from your credit report or loan application. Be sure follow the instructions for opting out on your privacy notice. If you opt out, it will remain in effect for at least five years or until you cancel your opt out. State law might have additional protections depending on where you live.
Privacy notices timing
All consumers must receive a privacy notice when a customer relationship is established, such as when opening a deposit account or obtaining a loan. Most banks send a new privacy notice each year; however, your bank may not be required to do so. For example, if the bank already limits sharing customer information to the exceptions listed above or the bank has not changed its privacy notice from the one previously delivered to you.
If your bank changes its privacy policy, it is required to send you a revised notice 30 days before the change. A privacy notice may be included as an insert with your monthly statement or bill. If you agreed to electronic delivery, the notice may be sent to you via email or made available to you on the bank’s website.
When you have more than one account with the same bank, your bank may choose to send one privacy notice for all accounts or one privacy notice for each account. Likewise, if you have a joint account, your bank may send a notice to one or both of you. You can request separate notices. Either way, if your bank offers opportunities to opt out, your bank must let one of the account holders opt out for all parties on the account.
Banks are also required to send you a new privacy notice when you obtain a new product or service with them. If you open an account by phone, you can agree to have your bank send you its privacy notice and make those changes later. If you need a current copy of your privacy notice, you can request it from your bank.
Prescreened credit offers
Credit reporting companies may also sell your financial information to lenders and insurers to decide whether or not to send you unsolicited offers of credit or insurance. This is known as prescreening. You can opt out of receiving prescreened offers by calling the Federal Trade Commission (FTC) at 1-888-567-8688, or visit the FTC website on Prescreened Credit and Insurance Offers.
Your financial privacy is important. It is up to you to take advantage of these protections by opting out. Knowing your financial privacy rights will go a long way in securing your financial health.
Additional resources:
FDIC: Deal With Identity Theft
FDIC: Reduce the Risk of Identity Theft
FTC: Protecting Consumers’ Financial Privacy
For more consumer resources, visit FDIC.gov, or go to the FDIC Knowledge Center. You can also call the FDIC toll-free at 1-877-ASK-FDIC (1-877-275-3342). Please send your story ideas or comments to ConsumerNews@fdic.gov.