Treasury guiding banks on privacy

The Treasury Department will release new security guidelines today to help

financial institutions comply with the privacy requirements in the Financial

Services Modernization Act of 1999.

The guidelines establish the "administrative, technical and physical safeguards

to protect the privacy of customers' personal information," said Jennifer

Dickerson, director of technology risk management at the Treasury's Office

of Thrift Supervision.

The guidelines are targeted at Title V of the act, which is also known as

the Gramm-Leach-Bliley Act. Title V calls for "each financial institution

to respect the privacy of its customers and to protect the security and

confidentiality" of customers' personal information.

This includes information being transferred between the roughly 20,000 financial

institutions — banks, credit unions and lenders — and agencies such as Treasury,

the Securities and Exchange Commission and the Federal Reserve.

"It is a very risk-based approach, and the key components were actually

pulled from supervisory guidance that the institutions have already released,"

Dickerson said.