GLBA Fundamentals (Part - 2)

Glass Steagall Act vs GLBA Act?

Commercial and Investment Banking Merging

Repeal of Glass-Steagall Restrictions:

• The Glass-Steagall Act kept banks, investment firms, and insurance companies separate. The GLBA changed this by allowing these businesses to merge and offer all services together.

Introduction of Consumer Protections:

• While GLBA allowed financial companies to grow bigger and offer more services, it also required them to protect customer information through rules like the Privacy Rule and Safeguards Rule.

This shows how GLBA removed old restrictions but added new protections for consumers.

GLBA Three Regulations — Safeguard, Privacy and Pretexting

Safeguard Rules

S1. Purpose of the Safeguards Rule

The rule ensures financial institutions:

• Safeguard customer information from threats like unauthorized access, data breaches, or theft.
• Protect the security, confidentiality, and integrity of non-public personal information (NPI).
• Develop a structured, ongoing plan to secure sensitive data.