What Is the GLBA Privacy Rule?

Now that you know what the GLBA data rule is, what does this regulation have to do with your auto dealership? While the law may seem like it’s focused on a different industry to yours, that’s not the case—at least not anymore. When the FTC broadened the definition of a “financial institution,” it included companies that engage in financial activities. As a business that regularly collects credit card numbers, brokers loans, and more, the FTC now recognizes your dealership as a financial institution.  

Although there are plenty of differences between a dealership and something like a bank, with the new rule change, you’re subject to the same consumer data protection standards as any traditional financial entity. What this means is, you must do what it takes to achieve GLBA compliance.

To achieve GLBA compliance, you have to meet the requirements in rule. The Privacy Rule states that financial institutions must give customers and consumers a written notice describing their privacy policies and practices. In this notice, you must describe how you collect, disclose, and protect private information. The following information is expected to be in your notice:

• The categories of information you collect
• The categories of information you disclose
• The categories of affiliates and non-affiliated third parties you’ve disclosed information to
• The categories of information disclosed under the joint marketing/service provider exemption
• If you’re disclosing private data that falls or doesn’t fall under the exemption
• Any disclosures required by the Fair Credit Reporting Act
• Your policies and practices for protecting private information

The FTC is serious about protecting consumer information, so it should come as no surprise that there are serious consequences. A business that’s non-compliant could face a recurring penalty of $43,792 per violation. In addition, you could also find your company penalized an additional $100,000 per violation if you’re non-compliant with the GLBA.