Federal Mortgage Law · 24% of the SAFE examhard
Correct answer: No disclosure is required for sharing with affiliates; a disclosure with opt-out rights is required only for sharing with unaffiliated third parties, and the company must give customers sufficient time to opt out before sharing occurs
Under GLBA, financial institutions have different obligations depending on whether they share nonpublic personal information with affiliated companies or unaffiliated third parties. Sharing with affiliates generally requires disclosure but not necessarily an opt-out right. Sharing with unaffiliated third parties for marketing purposes requires that the institution provide customers with a clear notice explaining the sharing and a reasonable opportunity to opt out before the sharing occurs. Customers who do not opt out within the allotted time can have their information shared. "Sharing information with affiliates requires a one-t..." overstates the requirement — GLBA uses an opt-out model, not an opt-in model, for most sharing. "No disclosure is required for sharing with affiliate..." is incorrect because anonymization does not eliminate GLBA disclosure obligations for unaffiliated third-party sharing of data that can identify individuals. "The company must obtain written opt-in consent from..." is incorrect because the annual privacy notice alone does not satisfy GLBA if it doesn't provide a meaningful opportunity to opt out of unaffiliated third-party sharing before it happens.
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