Thursday, September 26, 2002

Privacy Disclosure Notices Under Gramm-Leach-Bliley

A privacy law passed in 1999, called the Gramm-Leach-Bliley Act, requires banks and other financial institutions to send out notices informing their clients how information gathered about them will be shared with affiliates and other third parties. The Federal Trade Commission (FTC) is insisting that lawyers are also required under that law to send such privacy disclaimer notices to their clients.

The American Bar Association (ABA) has brought a law suit against the FTC to question the authority of the agency to govern confidential communications between lawyers and their clients:
"This federal statute that was intended to regulate banks is being used to muddy the waters with respect to the simple rules governing attorney-client confidentiality -- rules which virtually everybody understands," said ABA president Alfred P. Carlton Jr.
Every state already has extensive rules regarding attorney-client communications.