Which act requires financial institutions to notify customers of their privacy policy?

The Gramm-Leach-Bliley Act (GLBA) is the act that requires financial institutions to notify customers of their privacy policies. This legislation was enacted to ensure that consumers have a clear understanding of how their personal information is being collected and used by financial institutions. Under the GLBA, institutions must provide a privacy notice at the time of establishing a customer relationship and annually thereafter, informing customers about their privacy practices.

This requirement is crucial for maintaining transparency and building trust between financial institutions and their customers, as it empowers consumers to make informed decisions regarding their personal information. The act promotes privacy by requiring institutions to develop a comprehensive privacy policy and disclose it to customers, thus safeguarding their private data and ensuring compliance with these privacy standards.