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FARMERS STATE BANK
March 26, 2004
Robert E. Feldman, Executive Secretary
Attn: Comments/Executive Secretary Section
Federal Deposit Insurance Corporation
550 17th Street NW
Washington, DC 20429
RE: Interagency Proposal to Consider Alternative Forms of Privacy
Notices Under GLBA
Dear Mr. Feldman,
I am writing on behalf of Farmers State Bank, a state-chartered bank
located in Marion, Iowa. We have seven locations and a current asset
size of $435 million. We appreciate the opportunity to comment on the
above referenced topic.
You state in your Advance Notice of Proposed Rulemaking that you have
received concerns expressed by representatives of several different
groups that the current form of privacy notices are not useful and,
perhaps, unclear to consumers, the primary user of the information. I
happen to agree with this statement. Financial institutions, such as our
own, have again devoted a fair amount of their resources to developing a
notice for consumers that is not serving its purpose. Handing a consumer
a notice and then trying to explain to them that we may share
information with this entity and because we have a joint marketing
agreement (a term which means nothing to a consumer) with them, you
cannot opt-out. However, then we switch gears and say we share with
another third-party, and you can opt-out of sharing that information if
you provide us with some information by filling out this form. All this
after they have signed nineteen pages in a real estate loan closing and
they are supposed to be able to make informed decisions? I think it is
ridiculous! We try to be fair to consumers by making sure they have all
the information they need to make informed decisions, but have you ever
thought that maybe we are going a little overboard here?
I feel the goal of the privacy notice should be to inform the
consumer that we may share information with different entities, how it
will benefit them and that if you don't want us to share, let us know.
Plain, simple and done once. Not annually, not semi-annually, once.
Until a change is made in our sharing procedures there is no reason to
constantly send the consumer the same information. I agree with your
thoughts to propose a shorter notice that will serve this purpose.
However, I do not agree with you when you say that this shorter
notice should be a supplement to a longer, more detailed notice
available upon request. Let's be honest, who is going to request the
longer notice? Do you really think there would be enough people to make
it worthwhile for financial institutions to devote time and money to
preparing yet another notice? I can hardly believe it would be. Nine out
of ten of the current notices we give end up getting tossed before they
are out the door, not to mention the notices sent annually. I also do
not agree with any of your proposed "model formats" shown in the ANPR.
These notices seem to place a lot of emphasis on how a consumer can
opt-out of information sharing, however, has no designated area for us
to tell them how sharing information may be a benefit to them.
If the privacy notice requirements of the GLB Act are to stand, I
would support your development of alternatives to the current method by
allowing for a shorter, less complex notice to be given at the beginning
of an account relationship only. I believe by doing this we would meet
our goal of continuing to serve our consumers by providing them the
information they need to make informed decisions while easing the burden
placed on our financial institutions. If you have questions in regards
to my comments, please feel free to contact me. And, again, I thank you
for this opportunity.
Sincerely,
Diane M. Foltz
Compliance Officer
(319) 377-4891
dianefoltz@fsbmail.net
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