It’s in the best interests of a financial institution to comply with GLBA, but GLBA compliance isn’t optional. The Federal Trade Commission (FTC) monitors financial institutions and penalizes any organizations that it finds aren’t complying with GLBA.
The FTC’s penalties can include fines and judicial action. Getting penalized by the FTC can also harm a company’s reputation. Consumers are hesitant to work with organizations that aren’t proactive about protecting their privacy and information. Existing customers may feel betrayed by a financial institution that doesn’t comply with GLBA.
Complying with GLBA also ensures financial institutions have data security measures in place to protect customers. Customers must be informed of any information sharing between the financial institution and other parties. The organization must also take steps to secure customers’ information and protect it from malicious attacks.
GLBA compliance provides customers with peace of mind, which can make them more open to working with a particular financial institution and trusting that organization with their money and financial futures.