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Overview of The Gramm-Leach Bliley Act

The Gramm-Leach Bliley Act, commonly known as GLBA, was passed by the United States Senate and the U.S. House of Representatives on November 4, 1999. Contained within the act are privacy provisions to help protect consumer’s personal information being held by financial institutions-known as the Financial Privacy Rule, Safeguards Rule and Pretexting provisions. The term "financial institutions" is a rather broad term, which includes banks, financial securities firms, insurance entities and a host of other providers and industries that provide financial products and various services to consumers. Of the core privacy provisions within GLBA, the Financial Privacy Rule and Safeguards Rule have garnered the most attention from both consumers and financial institutions, primarily based on the growing demands placed on information security and protection of sensitive, non-public information.

SAS 70 Effect on GLBA

The rapid growth in regulatory compliance laws and regulations has had a profound impact on SAS 70 audits, resulting in many financial institutions requiring third party service organizations to become SAS 70 Type II certified. Because of the requirements set forth in GLBA, specifically within the Financial Privacy Rule and the Safeguards Rule, financial institutions, from banks to many other entities and organizations identified as "financial institutions", must ensure their outsourced providers are compliant within the framework of the GLBA privacy provisions. Because of the continued growth in outsourcing, SAS 70 audits will continue to be an important component of GLBA for purposes of compliance for financial institutions and their third party outsourcers, commonly known as service organizations. As a result, service organizations will be faced with additional regulatory compliance costs and must take proactive measures in communicating with all parties (auditors, financial institutions, and intended users of the SAS 70 report) in preparing and assisting with SAS 70 compliance for notable issues, such as cost, scope, and timeframe of the audit.

GLBA Timeline

Timeline of Gramm-Leach-Bliley Act
March 4, 1999	Senate Banking Committee approves the Financial Services Modernization Act of 1999.
April 28, 1999	Senate Banking Committee formally files the Financial Services Modernization Act in the Senate.
May 6, 1999	The Senate approves S. 900, Financial Services Modernization Act of 1999
July 1, 1999	The House of Representatives approves H.R. 10.
July 23, 1999	Senate Banking Committee's 20 Members named to conference.
July 30, 1999	House appoints members to conference.
August 3, 1999	Conference comittee holds first meeting.
October 12, 1999	Chairmen Gramm, Leach and Bliley release chairmen's mark.
October 22, 1999	Conference committee holds final meeting; names bill the Gramm-Leach-Bliley Act.
November 2, 1999	Conference report signed by majority of conferees, clearing way for votes in House and Senate.
November 4, 1999	Gramm-Leach-Bliley Act passes the Senate 90-8 and the House 362-57.

Source: http://banking.senate.gov/prel99/1105tme.htm