Podcast
Questions and Answers
What primary purpose does the Gramm-Leach-Bliley Act serve for financial institutions?
What primary purpose does the Gramm-Leach-Bliley Act serve for financial institutions?
- To regulate interest rates on loans provided by financial institutions.
- To increase the number of financial products offered to consumers.
- To ensure the protection and privacy of consumer financial data. (correct)
- To mandate the sharing of customer information with third parties.
Which of the following is NOT a rule outlined by the Privacy requirements of the Gramm-Leach-Bliley Act?
Which of the following is NOT a rule outlined by the Privacy requirements of the Gramm-Leach-Bliley Act?
- Data Protection Rule (correct)
- Consumer Privacy Rule
- Disclosure Rule
- Financial Privacy Rule
What does ethical conduct entail for an individual in a business context?
What does ethical conduct entail for an individual in a business context?
- Performing actions that are only beneficial to oneself.
- Making transparent and fair judgments affecting all parties involved. (correct)
- Making decisions based solely on financial gain.
- Conducting business without regard for legal regulations.
Which issue could be addressed by laws ensuring ethical conduct in business?
Which issue could be addressed by laws ensuring ethical conduct in business?
What type of information does the Financial Privacy Rule govern?
What type of information does the Financial Privacy Rule govern?
What distinguishes a consumer from a customer in the context of financial services?
What distinguishes a consumer from a customer in the context of financial services?
Which of the following is NOT a requirement for financial institutions regarding customer information?
Which of the following is NOT a requirement for financial institutions regarding customer information?
What do the Pretexting Provisions focus on in the context of consumer protection?
What do the Pretexting Provisions focus on in the context of consumer protection?
Which agency is empowered to enforce the regulations contained in the Act?
Which agency is empowered to enforce the regulations contained in the Act?
What is the maximum civil penalty for each violation of the law as stated?
What is the maximum civil penalty for each violation of the law as stated?
Flashcards
Business Ethics
Business Ethics
Moral principles that guide how an individual or company conducts business.
Ethical Conduct
Ethical Conduct
Actions that are transparent, fair, honest, and considerate to all parties involved.
Gramm-Leach-Bliley Act (GLB)
Gramm-Leach-Bliley Act (GLB)
A law that requires financial institutions to disclose their information-sharing procedures and protect sensitive data.
Nonpublic Personal Information
Nonpublic Personal Information
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Financial Privacy Rule
Financial Privacy Rule
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Consumer
Consumer
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Customer
Customer
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Privacy and Opt-Out Notices
Privacy and Opt-Out Notices
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Safeguards Rule
Safeguards Rule
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Pretexting Provisions
Pretexting Provisions
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Study Notes
Business Ethics and the Law
- Business ethics are moral principles guiding business conduct.
- Ethical decisions involve transparency, fairness, honesty, and consideration for all parties.
- Ethical decisions can have legal consequences.
- Fraud and deceptive advertising are ethical concerns with legal ramifications.
Gramm-Leach-Bliley (GLB) Act
- The GLB Act mandates financial institutions disclose information-sharing to customers and protect consumer data.
- Title V (Privacy) focuses on sharing customer and personal financial data relevant to mortgage lending.
- Three Key GLB Rules:
- Financial Privacy Rule: Governs collection of nonpublic information, including application data, data from other sources, and transaction details (balances, purchases). Customer status (one-time consumer vs. continuing customer) is relevant. Initial and annual privacy/opt-out notices are required for customers, but not all consumers. Specifies when information sharing with affiliates or other parties is allowed.
- Safeguards Rule: Financial institutions must protect customer data in their custody.
- Pretexting Provisions: Protect consumers from fraudulent acquisition of their financial information.
- Enforcement and Penalties:
- FTC and other federal/state agencies enforce the Act.
- Violations can result in civil penalties up to $100,000 per violation.
- Officers/directors can face personal liability (up to $10,000 per violation).
- Institutions and officers/directors may be fined and face imprisonment of up to 5 years, or both.
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Description
This quiz explores the intersection of business ethics and the Gramm-Leach-Bliley Act (GLB Act). It focuses on the principles guiding ethical business conduct, such as transparency and fairness, and the legal implications of ethical decisions. Additionally, it covers the privacy regulations mandated by the GLB Act related to financial institutions and consumer data protection.
