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FDIC Federal Register Citations

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

Last Updated 04/05/2004 regs@fdic.gov

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