| Financial
Services Modernization Act (FSMA)
The Financial Services
Modernization Act (FSMA) is also known as the Gramm-Leach-Bliley
Act (GLBA), after its Congressional sponsors, and as the Financial
Modernization and Privacy Act (FMPA), following one of its
legislative titles.
FSMA permits banks,
brokerage firms, insurance companies and other financial institutions
to operate as a single entity, eliminating limitations on
joint ventures that had been in place since the Depression.
Concomitant to the consolidations, affiliated companies are
permitted to share data about consumers.
FSMA requires that
financial institutions provide customers with a "Privacy
Policy" notice, similar to that required by HIPAA's
Privacy Rule, that outlines the organization's data practices.
It also requires that institutions develop policies to prevent
fraudulent access to their data, and put in place appropriate
administrative, physical and technical data safeguards. (FSMA's
safeguard requirements are similar to those of the HIPAA
Security Rule.)
See also:
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