What does the Gramm-Leach-Bliley (GLB) Act prevent?

What does the Gramm-Leach-Bliley (GLB) Act prevent?

• A. Financial institutions from increasing interest rates
• B. Financial institutions from disclosing nonpublic personal information without consent
• C. Financial institutions from offering loans
• D. Financial institutions from merging with others

Answer: (B)

The Gramm-Leach-Bliley (GLB) Act primarily addresses the protection of consumers' personal financial information held by financial institutions. One of its critical provisions prevents these institutions from disclosing nonpublic personal information about consumers without obtaining their consent. This requirement is in place to ensure that individuals' financial data remains confidential and secure, thereby fostering trust between consumers and financial entities. The law mandates that financial institutions implement privacy policies and practices that protect sensitive information and inform consumers about these practices. As such, the focus of the GLB Act is significantly on consumer privacy rights rather than on regulating interest rates, loan offerings, or mergers among institutions. This makes the selected answer the correct one, as it aligns directly with the intent of the legislation regarding the handling of personal information.

The Gramm-Leach-Bliley (GLB) Act primarily addresses the protection of consumers' personal financial information held by financial institutions. One of its critical provisions prevents these institutions from disclosing nonpublic personal information about consumers without obtaining their consent. This requirement is in place to ensure that individuals' financial data remains confidential and secure, thereby fostering trust between consumers and financial entities.

The law mandates that financial institutions implement privacy policies and practices that protect sensitive information and inform consumers about these practices. As such, the focus of the GLB Act is significantly on consumer privacy rights rather than on regulating interest rates, loan offerings, or mergers among institutions. This makes the selected answer the correct one, as it aligns directly with the intent of the legislation regarding the handling of personal information.