QUESTION
We
are a mortgage lender with several branch offices.
One of our branch managers
would like to send an email promoting a local charity event to all of her current
and past clients, as well as the charity’s flyer promoting the event.
The event
is a 5k run/walk to raise awareness and funds for cystic fibrosis research and
has nothing to do with company business.
Are such mailings permissible?
ANSWER
Essentially, the lender would be sending the
charity’s marketing materials to the lender’s customers, which is not
prohibited by the Gramm Leach Bliley Act and its implementing regulation,
Regulation P.
However, if an individual’s response to the
flyer would reveal to the charity that the individual is a customer of the
lender, there would be an inadvertent disclosure by the lender of non-public
personal information (NPI) in violation of the Act.
For example, let’s assume the charity wanted
to track the effectiveness of its marketing efforts and includes a reference
code only attributable to the lender on the flyer, which also served as the
event registration form.
Thus, when an individual uses the form to register,
the lender has disclosed NPI to the charity, that is, the individual is the
lender’s customer. In order to comply with the Act, the lender would have had
to either disclose in its initial and annual privacy statement that it shares
customer’s NPI with "nonfinancial institutions, such as charitable
organizations" and provide the customer with a reasonable opportunity to
opt out of such sharing or obtain the customer’s consent to such arrangements.
Joyce
Wilkins Pollison, Esq.
Director/Legal & Regulatory Compliance
Lenders Compliance Group
