Reference no: EM133810442

Question

The disclosure/opt-in structure effectively protects privacy by ensuring some privacy protections and preventing uncontrolled data sharing. The opt-out structure helps individuals control their data. The opt-out structure allows consumers to choose whether or not to share their private data with nonaffiliated third parties. It is important to note as in the last discussion that many consumers do not read the disclosures opt-out notices. More often than not, they are hidden within the privacy disclosures. Therefore, the opt-out option is not always taken into consideration if the consumer does not read it. Moreover, it requires financial institutions to disclose how they collect and use that personal data. Lastly, financial institutions' privacy notices must be "clear and conspicuous", where it is reasonably understandable and calls attention to the significance of the information contained (Federal Deposit Insurance Corporation 2016). However, federal agencies are in charge of enforcement. The GLBA relies on regulatory bodies like the Consumer Financial Protection Bureau (CFPB) and Federal Trade Commission (FTC) to enforce compliance which may limit individuals' recourse. Thus, when individuals lack direct recourse for violating their privacy, it reduces the deterrence against noncompliance with the GLBA (Securities and Exchange Commission, Final Model Privacy Form). Yes, it is marginally better than having no protections at all. The GLBA's rules ensure a degree of privacy awareness and institutional accountability, preventing unfettered data sharing.