Federal Register / Vol. 76, No. 141 / Friday, July 22, 2011 / Rules and Regulations 43879 

1See 75 FR 66018, Oct. 27, 2010. 

2See the Dodd-Frank Wall Street Reform and 

Consumer Protection Act, Public Law 111–203, 124 

Stat. 1376 (2010). The text of the Dodd-Frank Act 

may be accessed at http://www.cftc.gov./ 

LawRegulation/OTCDERIVATIVES/index.htm. 

(x) Swap dealer. The term ‘‘swap 

dealer’’ has the same meaning as in 

section 1a(49) of the Commodity 

Exchange Act, 7 U.S.C. 1 et seq., as may 

be further defined by this title, and 

includes any person registered as such 

thereunder. 

* * * * * 

(y) * * * 

(4) Any commodity pool operator; 

(5) Any introducing broker; 

(6) Any major swap participant; and 

(7) Any swap dealer. 

* * * * * 

■ 5. Revise § 160.15(a)(4) to read as 

follows: 

§ 160.15 Other exceptions to notice and 

opt out requirements. 

* * * * * 

(4) To the extent specifically 

permitted or required under other 

provisions of law and in accordance 

with the Right to Financial Privacy Act 

of 1978, 12 U.S.C. 3401 et seq., to law 

enforcement agencies (including a 

Federal functional regulator, the 

Secretary of the Treasury, with respect 

to 31 U.S.C. Chapter 53, Subchapter II 

(Records and Reports on Monetary 

Instruments and Transactions) and 12 

U.S.C. Chapter 21 (Financial 

Recordkeeping), a State insurance 

authority, with respect to any person 

domiciled in that insurance authority’s 

state that is engaged in providing 

insurance, and the Bureau of Consumer 

Financial Protection), self-regulatory 

organizations, or for an investigation on 

a matter related to public safety; 

* * * * * 

■ 6. Amend § 160.17 by revising 

paragraph (b) to read as follows: 

§ 160.17 Relation to state laws. 

* * * * * 

(b) Greater protection under state law. 

For purposes of this section, a state 

statute, regulation, order or 

interpretation is not inconsistent with 

the provisions of this part if the 

protection such statute, regulation, 

order or interpretation affords any 

person is greater than the protection 

provided under this part, as determined 

by the Bureau of Consumer Financial 

Protection, after consultation with the 

Commission, on its own motion or upon 

the petition of any interested party. 

■ 7. Revise § 160.30 to read as follows: 

§ 160.30 Procedures to safeguard 

customer records and information. 

Every futures commission merchant, 

retail foreign exchange dealer, 

commodity trading advisor, commodity 

pool operator, introducing broker, major 

swap participant, and swap dealer 

subject to the jurisdiction of the 

Commission must adopt policies and 

procedures that address administrative, 

technical and physical safeguards for 

the protection of customer records and 

information. 

Issued in Washington, DC on July 7, 2011 

by the Commission. 

David A. Stawick, 

Secretary of the Commission. 

Appendices to Privacy of Consumer 

Financial Information; Conforming 

Amendments Under Dodd-Frank Act— 

Commission Voting Summary and 

Statements of Commissioners 

Note: The following appendices will not 

appear in the Code of Federal Regulations. 

Appendix 1—Commission Voting 

Summary 

On this matter, Chairman Gensler and 

Commissioners Dunn, Sommers, O’Malia and 

Chilton voted in the affirmative; no 

Commissioner voted in the negative. 

Appendix 2—Statement of Chairman 

Gary Gensler 

I support the final rulemaking to expand 

the scope of privacy protections for consumer 

financial information under the GrammLeach-Bliley Act. The rulemaking expands 

the scope of the Commission’s existing 

privacy protections afforded to consumers’ 

information—under the Commission’s Part 

160 rules—to swap dealers and major swap 

participants. 

[FR Doc. 2011–17710 Filed 7–21–11; 8:45 am] 

BILLING CODE 6351–01–P 

COMMODITY FUTURES TRADING 

COMMISSION 

17 CFR Part 162 

RIN 3038–AD12 

Business Affiliate Marketing and 

Disposal of Consumer Information 

Rules 

AGENCY: Commodity Futures Trading 

Commission. 

ACTION: Final rule. 

SUMMARY: The Commodity Futures 

Trading Commission is adopting 

regulations to implement new statutory 

provisions enacted by title X of the 

Dodd-Frank Wall Street Reform and 

Consumer Protection Act. These 

regulations apply to futures commission 

merchants, retail foreign exchange 

dealers, commodity trading advisors, 

commodity pool operators, introducing 

brokers, swap dealers and major swap 

participants. The Dodd-Frank Act 

provides the Commission with authority 

to implement regulations under sections 

624 and 628 of the Fair Credit Reporting 

Act. The regulations implementing 

section 624 of the Fair Credit Reporting 

Act require CFTC-regulated entities to 

provide consumers with the opportunity 

to prohibit affiliates from using certain 

information to make marketing 

solicitations to consumers. The 

regulations implementing section 628 of 

the FCRA require CFTC-regulated 

entities that possess or maintain 

consumer report information in 

connection with their business activities 

to develop and implement written 

policies and procedures for the proper 

disposal of such information. 

DATES: Effective date: September 20, 

2011. 

Compliance dates: Futures 

commission merchants, commodity 

pool operators, commodity trading 

advisors, introducing brokers, and retail 

foreign exchange dealers shall be in 

compliance with these rules not later 

than November 21, 2011. Swap dealers 

and major swap participants shall be in 

compliance with these rules not later 

than 60 days after the effective date of 

the final entities definition rulemaking, 

which the Commission will have 

published in the Federal Register at a 

future date. 

FOR FURTHER INFORMATION CONTACT: Carl 

E. Kennedy, Counsel, (202) 418–6625, 

Commodity Futures Trading 

Commission, Office of the General 

Counsel, Three Lafayette Centre, 1155 

21st Street, NW., Washington, DC 

20581, facsimile number (202) 418– 

5524, e-mail: c_kennedy@cftc.gov. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. Background 

II. Rule Amendments 

A. Affiliate Marketing Rules 

B. Disposal Rules 

II. Cost-Benefit Analysis 

III. Paperwork Reduction Act 

IV. Regulatory Flexibility Act 

V. Text of Final Rules 

I. Background 

On October 27, 2010, the Commodity 

Futures Trading Commission 

(‘‘Commission’’ or ‘‘CFTC’’) proposed in 

the Federal Register the addition of a 

new part 162 to its Regulations (the 

‘‘Proposal’’).1 New part 162 was 

proposed to implement section 1088 of 

the Dodd-Frank Wall Street Reform and 

Consumer Protection Act 2 (‘‘DoddVerDate Mar<15>2010 18:10 Jul 21, 2011 Jkt 223001 PO 00000 Frm 00077 Fmt 4700 Sfmt 4700 E:\FR\FM\22JYR1.SGM 22JYR1

emcdonald on DSK2BSOYB1PROD with RULES
43880 Federal Register / Vol. 76, No. 141 / Friday, July 22, 2011 / Rules and Regulations 

3See 15 U.S.C. 1681–1681x. The FCRA, enacted 

in 1970, sets standards for the collection, 

communication, and use of information bearing on 

a consumer’s credit worthiness, credit standing, 

credit capacity, character, general reputation, 

personal characteristics, or mode of living that is 

collected and communicated by consumer reporting 

agencies. 

4See Public Law 108–159, Section 214, 117 Stat. 

1952, 1980 (2003). The FACT Act was signed into 

law on December 4, 2003. The FACT Act amended 

the FCRA to enhance the ability of consumers to 

combat identity theft, to increase the accuracy of 

consumer reports, to allow consumers to exercise 

greater control regarding the type and amount of 

solicitations they receive, and to restrict the use and 

disclosure of sensitive medical information. A 

portion of section 214 of the FACT Act amended 

the FCRA to add section 624 to the FCRA. 

5The CFTC-regulated entities that were covered 

in the Proposal included futures commission 

merchants (‘‘FCMs’’), retail foreign exchange 

dealers (‘‘RFEDs’’), commodity trading advisors 

(‘‘CTAs’’), commodity pool operators (‘‘CPOs’’), 

introducing brokers (‘‘IBs’’), swap dealers (‘‘SDs’’), 

or major swap participants (‘‘MSPs’’). Title VII of 

the Dodd-Frank Act created two new entities, 

which are subject to the jurisdiction of the 

Commission: SDs and MSPs. Section 162.2(n) of the 

Commission’s regulations, 17 CFR 162.2(n), defines 

the term ‘‘major swap participant’’ to have the same 

meaning as in section 1a(33) of the Commodity 

Exchange Act, 7 U.S.C. 1 et seq. (‘‘CEA’’), as may 

be further defined by the Commission’s regulations, 

and includes any person registered as such 

thereunder. Section 162.2(r) of the Commission’s 

regulations, 17 CFR 162.2(r), defines the term 

‘‘swap dealer’’ to have the same meaning as in 

section 1a(49) of the CEA, as may be further defined 

by the Commission’s regulations, and includes any 

person registered as such thereunder. 

6For the disposal rules adopted by the various 

Federal agencies, see 69 FR 68690 (Nov. 24, 2004) 

(FTC); 69 FR 77610, Dec. 28, 2004 (Banking 

Agencies); 73 FR 13692, Mar. 13, 2008 (SEC). For 

the affiliate marketing rules adopted by the various 

Federal agencies, see 72 FR 61424, Oct. 31, 2007 

(FTC); 72 FR 62910, Nov. 7, 2007 (Banking 

Agencies); 74 FR 58204, Sept. 10, 2009 (SEC). 

7See 75 FR at 66019. 

8Copies of these comment letters are available on 

the Commission’s Web site at http://www.cftc.gov. 

9The Securities Industry and Financial Markets 

Association (‘‘SIFMA’’) submitted a comment letter 

dated December 20, 2010 (the ‘‘SIFMA letter’’). The 

International Swaps and Derivatives Association 

(‘‘ISDA’’) and the Financial Services Roundtable 

(‘‘FSR’’) jointly submitted a comment letter dated 

December 27, 2010 (the ‘‘ISDA/FSR letter’’). As 

noted above, both letters are available on the 

Commission’s Web site. 

10The Commission also has made a few technical 

revisions to its final rules to add clarity. For 

example, in § 162.4(a)(2)(ii), the Commission 

revised two of the examples of what constitutes a 

continuing relationship with a covered affiliate. 

Specifically, the Commission revised these 

examples to demonstrate instances where an SD or 

MSP may have such a relationship, and where a 

swap transaction may evidence such a relationship. 

11Proposed § 162.2(f) defined the term 

‘‘consumer’’ to mean an individual person. This 

definition follows the statutory definition in section 

603(c) of the FCRA. As was noted in the preamble 

to the Proposal, an individual acting through a legal 

representative qualifies as a consumer. The 

Commission is amending the definition in the final 

rule as described herein to address comments 

received in response to the Proposal. 

12See 17 CFR 162.2(k), which defines the term 

‘‘eligibility information’’ to mean any information 

that would be a consumer report if the exclusions 

from the definition of ‘‘consumer report’’ in section 

603(d)(2)(A) of the FCRA did not apply. Examples 

of the type of information that would fall within the 

definition of ‘‘eligibility information’’ includes an 

affiliate’s own transaction or experience 

information, such as information about a 

consumer’s account history with that person, and 

other information, such as information from credit 

bureau reports or applications. The term ‘‘eligibility 

information’’ does not include aggregate or blind 

data that does not contain personal identifiers. 

Examples of personal identifiers include account 

numbers, names, or addresses, as well as Social 

Security numbers, driver’s license numbers, 

telephone numbers, or other types of information 

that, depending on the circumstances or when used 

in combination, could identify the consumer. 

13See 17 CFR 162.2(a), which defines ‘‘affiliates’’ 

to mean ‘‘any person that is related by common 

ownership or common corporate control with a 

covered affiliate.’’ 

14See 17 CFR 162.2(q), which defines the term 

‘‘pre-existing business relationship’’ to mean a 

relationship between a person (or a person’s 

licensed agent) and a consumer based on the 

following: (1) A financial contract between the 

person and the consumer that is in force on the date 

on which the consumer is sent a solicitation by this 

subpart; (2) the purchase, rental, or lease by the 

consumer of a person’s financial products or 

services, or a financial transaction (including 

holding an active account or a policy in force or 

having another continuing relationship) between 

Frank Act’’), which sets out two 

amendments to the Fair Credit 

Reporting Act (‘‘FCRA’’) 3 and the Fair 

and Accurate Credit Transactions Act of 

2003 (‘‘FACT Act’’).4 As amended, the 

FCRA directs the Commission to 

promulgate regulations that are 

intended to provide privacy protections 

to certain consumer information held by 

any person that is subject to the 

enforcement jurisdiction of the 

Commission. One provision of section 

1088 of the Dodd-Frank Act amends 

section 214(b) of the FACT Act—which 

added section 624 to the FCRA in 

2003—and directs the Commission to 

implement the provisions of section 624 

of the FCRA with respect to persons that 

are subject to the CFTC’s enforcement 

jurisdiction. Section 624 of the FCRA 

gives consumers the right to prohibit 

certain CFTC-regulated entities 5 from 

using certain information obtained from 

an affiliate to make solicitations to that 

consumer (hereinafter referred in this 

preamble as the ‘‘affiliate marketing 

rules’’). Specifically, 17 CFR 162.3 

establishes the basic rules governing the 

requirement to provide the consumer 

with notice, a reasonable opportunity 

and a simple method to opt out of a 

company’s use of eligibility information 

that it obtains from an affiliate for the 

purpose of making solicitations to the 

consumer. This section and the affiliate 

marketing rule requirements are 

discussed in more detail below. 

The other provision in section 1088 of 

the Dodd-Frank Act amends section 628 

of the FCRA and mandates that the 

Commission implement regulations 

requiring persons subject to the CFTC’s 

jurisdiction who possess or maintain 

consumer report information in 

connection with their business activities 

to properly dispose of that information 

(hereinafter referred to in this preamble 

as the ‘‘disposal rules’’). 

Both sections 624 and 628 of the 

FCRA required various Federal agencies 

charged with regulating financial 

institutions in possession of consumer 

information to issue regulations in final 

form in consultation and coordination 

with each other. In particular, these 

sections required the Office of the 

Comptroller of the Currency (‘‘OCC’’), 

the Board of Governors of the Federal 

Reserve System (‘‘Board’’), the Federal 

Deposit Insurance Corporation 

(‘‘FDIC’’), the Office of Thrift 

Supervision (‘‘OTS’’), the National 

Credit Union Administration (‘‘NCUA’’) 

(collectively, the ‘‘Banking Agencies’’), 

the Securities and Exchange 

Commission (‘‘SEC’’) and the Federal 

Trade Commission (‘‘FTC’’) (the SEC, 

FTC and the Banking Agencies, are 

collectively, the ‘‘Agencies’’) in 

consultation and coordination with one 

another, to issue rules implementing 

these sections of the FCRA. The 

Agencies already have adopted final 

affiliate marketing rules and disposal 

rules.6 The Commission, after 

consulting with many of the Agencies, 

is acting now pursuant to the DoddFrank Act to finalize and implement the 

affiliate marketing rules and disposal 

rules. 

The 60-day public comment period on 

the Proposal expired on December 27, 

2010.7 In response to the Proposal, the 

Commission received a total of four 

comment letters.8 Two of the four 

addressed the merits or substance of the 

Proposal.9 Specifically, these comments 

addressed the following issues: (1) 

Consistency with the other Agencies’ 

final regulations; (2) minor changes to 

the ‘‘consumer’’ definition; (3) 

correction of minor typographical 

errors; (4) the compliance date of the 

rules; and (5) consideration of 

additional burdens that Commission did 

not address in the Proposal’s Paperwork 

Reduction Act and cost-benefit 

analyses.10

II. Rule Amendments 

A. Affiliate Marketing Rules 

Section 624 of the FCRA generally 

provides that a consumer can block 

certain CFTC-regulated entities from 

soliciting the consumer 11 based on 

eligibility information 12 that such 

registrant received from an affiliate 13

that has or previously had a pre-existing 

business relationship 14 with that 


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Federal Register / Vol. 76, No. 141 / Friday, July 22, 2011 / Rules and Regulations 43881 

the consumer and the person, during the 18-month 

period immediately preceding the date on which a 

solicitation covered by this subpart is sent to the 

consumer; or (3) an inquiry or application by the 

consumer regarding a financial product or service 

offered by that person during the three-month 

period immediately preceding the date on which 

the consumer is sent a solicitation covered by this 

subpart. 

15See 17 CFR 162.2(h), which defines the term 

‘‘covered affiliate’’ to mean an FCM, RFED, CTA, 

CPO, IB, SD, or MSP, which is subject to the 

jurisdiction of the Commission. 

16See 17 CFR 162.2(r), which defines the term 

‘‘solicitation’’ to mean the marketing of a financial 

product or service initiated by a covered affiliate to 

a particular consumer that is based on eligibility 

information communicated to the covered affiliate 

by its affiliate and is intended to encourage the 

consumer to purchase the covered affiliate’s 

financial product or service. A communication, 

such as a telemarketing solicitation, direct mail, or 

e-mail, is a solicitation if it is directed to a specific 

consumer based on eligibility information. The 

definition of solicitation does not, however, include 

communications that are directed at the general 

public without regard to eligibility information, 

even if those communications are intended to 

encourage consumers to purchase financial 

products and services from the person initiating the 

communications. 

17Section 162.3(d) of the Commission’s 

regulations sets forth when a covered affiliate 

makes a solicitation to a consumer. 

18See 17 CFR 162.2(b), which defines the term 

‘‘clear and conspicuous’’ to mean reasonably 

understandable and designed to call attention to the 

nature and significance of the information 

presented in the notice. 

19See 17 CFR 162.2(h), which defines the term 

‘‘concise’’ to mean a reasonably brief expression or 

statement. 

20Section 162.3(b) of the Commission’s 

regulations, 17 CFR 162.3(b), identifies the parties 

who are responsible to provide the notice as either: 

(1) The affiliate with a pre-existing business 

relationship to report the initial opt-out notice 

directly to the consumer; or (2) one or more of 

affiliates to provide a joint notice to the consumer, 

provided that at least one of the affiliates has or 

previously had the pre-existing business 

relationship with the consumer. 

Section 162.4(b) provides that an opt-out election 

must be effective for a period of at least five years 

beginning when the consumer’s opt-out election is 

received and implemented, unless the consumer 

subsequently revokes the opt-out election in writing 

or, if the consumer agrees, electronically. 

21Section 162.6(a) of the Commission’s 

regulations, 17 CFR 162.6(a), sets forth the general 

rule prohibiting covered affiliates from using 

eligibility information about a consumer unless the 

consumer is provided a reasonable opportunity to 

opt out, as required by the proposed regulation. 

Section 162.7(b) sets forth reasonable and simple 

methods of opting out. 

22See the SIFMA letter at 3. 

23See the SIFMA letter at 4 and the ISDA/FSR 

letter at 2. 

24See 15 U.S.C. 6809(9). 25See the SIFMA letter at 5. 

consumer. To implement section 624 of 

the FCRA, § 162.3(a) establishes three 

conditions that must be met before a 

covered affiliate 15 that does not have a 

pre-existing business relationship with a 

consumer may use eligibility 

information to make a solicitation 16 to 

that consumer.17 First, the rule provides 

that a notice must be clearly and 

conspicuously 18 disclosed to the 

consumer in writing or, if the consumer 

agrees, electronically, in a concise 19

notice that the covered affiliate that 

does not have a pre-existing business 

relationship may use shared eligibility 

information to make solicitations to the 

consumer.20 Second, the consumer must 

be provided a reasonable opportunity 

and a reasonable and simple method to 

opt out of the use of that eligibility 

information to make solicitations to the 

consumer.21 Third, the consumer must 

not have opted out. 

As noted above, the Commission 

received specific comments regarding 

the definition of certain terms. In 

particular, the Securities Industry 

Financial Markets Association 

(‘‘SIFMA’’) suggested that the 

Commission amend the proposed 

definition of the term ‘‘affiliate’’ in order 

to make it conform to the Agencies’ 

rules.22 In the Proposal, the Commission 

defined ‘‘affiliate’’ as ‘‘any company that 

is under common ownership or 

common corporate control.’’ SIFMA 

suggested that the Commission change 

this definition by using the words 

‘‘related by’’ rather than ‘‘under.’’ The 

Commission agrees that this change will 

further the goal of consistency with 

other Agencies’ rules and has adopted 

this suggestion in its final rules. 

In addition, SIFMA and, in a joint 

letter, the International Swaps and 

Derivatives Association (‘‘ISDA’’) and 

the Financial Services Roundtable 

(‘‘FSR’’) encouraged the Commission to 

revise the ‘‘consumer’’ definition to 

indicate that individuals who provide 

identifiable information for nonconsumer purposes are not 

‘‘consumers.’’ 23 Specifically, these 

commenters contend that the proposed 

definition is over-inclusive and as a 

result would include individuals such 

as market makers, individual floor 

brokers, locals, and others whose 

individually identifiable information 

may be collected in furtherance of 

market-related transactions for nonconsumer purposes. These commenters 

recommend that the Commission 

employ a definition similar to that in 

title V of the Gramm-Leach-Bliley Act.24

The Commission agrees that including 

such individuals could possibly be 

overreaching the intent of the FCRA, 

and has added a qualifying statement to 

the consumer definition which excludes 

from that definition persons who are 

‘‘market makers, floor brokers, locals, or 

individual persons whose information is 

not collected to determine eligibility for 

personal, family, or household 

purposes.’’ 

With respect to several of the 

examples that the Commission set out in 

the Proposal’s preamble and rule text for 

the affiliate marketing rules, SIFMA 

noted that the Commission’s usage of 

examples in the Proposal were 

inconsistent with the usage of examples 

by other Agencies in their final rules.25

In particular, SIFMA pointed out that, 

unlike the other Agencies’ rules, the 

Proposal does not contain examples of 

‘‘solicitation,’’ and does contain 

examples of ‘‘eligibility information.’’ 

SIFMA suggested that, to ‘‘maximize 

[the final rules’] benefit and promote 

consistency,’’ the Commission revise the 

affiliate marketing rules to follow the 

Agencies’ usage of examples in their 

final affiliate marketing rules. That is, 

when the Agencies have included 

examples in the text of the rules, the 

Commission should incorporate 

examples into its final rules, and vice 

versa. In addition, SIFMA asked the 

Commission to indicate that the 

examples are merely illustrative of 

acceptable practices and are not 

prescriptive. Lastly, SIFMA asked the 

Commission to make clear that 

examples and practices developed in 

connection with the analogues rules of 

the Agencies should be considered as 

potential guidance for the Commission’s 

rule. 

Despite SIFMA’s comments, the 

Commission does not believe that the 

inclusion or exclusion of examples 

warrants an interpretation of the 

Commission’s final affiliate marketing 

rules that is different than the 

interpretation of the Agencies’ final 

affiliate marketing rules. The 

Commission has chosen a slightly 

different approach than the Agencies in 

terms of its usage of examples. This 

approach should not be read to suggest 

that the Commission intended a 

different interpretation of its rules. 

Indeed, the Commission has included 

examples where it believes they will be 

illustrative, and does not believe that 

these examples should be read as 

prescriptive. Lastly, the Commission has 

decided not to include a statement to 

the effect that the examples in the 

Agencies’ rules should be considered as 

guidance with respect to the 

Commission’s rule. The Agencies’ 

examples are directed at their 

registrants; the Commission’s examples 

are directed at its registrants. Again, 

these differences should not be 

interpreted to suggest that the 

Commission’s rule is different. 

SIFMA also pointed out two 

typographical errors which the 

Commission has corrected in the final 


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43882 Federal Register / Vol. 76, No. 141 / Friday, July 22, 2011 / Rules and Regulations 

26See the SIFMA letter at 4–5. 27See 17 CFR 162.2(i), which defines the terms 

‘‘dispose’’ or ‘‘disposal’’ to mean the discarding or 

abandonment of consumer information or the sale, 

donation, or transfer of any medium, including 

computer equipment, upon which consumer 

information is stored. The Proposal noted that the 

sale, donation, or transfer, as opposed to the 

discarding or abandonment, of consumer 

information would not be considered ‘‘disposal’’ 

under this definition. For example, an entity subject 

to the disposal rule that transfers consumer report 

information to a third party for marketing purposes 

would not be discarding the information for the 

purposes of the disposal rule. If the entity sells 

computer equipment on which consumer report 

information is stored, however, the sale would be 

considered disposal. This definition is wholly 

consistent with the definition of ‘‘dispose’’ or 

‘‘disposal’’ in the Agencies’ final disposal rules. For 

those reasons, the Commission adopts this 

definition as proposed. 

28Like the affiliate marketing rules, the types of 

Commission-regulated entities that are subject to 

the disposal rules are FCMs, RFEDs, CTAs, CPOs, 

IBs, SDs, and MSPs. 

29See 17 CFR 162.2(g), which defines the term 

‘‘consumer information’’ to mean any record about 

an individual, whether in paper, electronic, or other 

form that is a consumer report or is derived from 

a consumer report (as defined section 603(d)(1) of 

the FCRA). Consumer information also means a 

compilation of such records. Consumer information 

does not include information that does not identify 

individuals, such as aggregate information or blind 

data. 

30See 75 FR 66014, Oct. 27, 2010. The effective 

date of the part 160 conforming amendments 

rulemaking was intended to follow the designated 

transfer date when various Federal agencies transfer 

their consumer protection authority to the 

Consumer Financial Protection Bureau pursuant to 

section 1100H of the Dodd-Frank Act. 

31See the SIFMA letter at 6. 

32See the Commission’s proposed entities 

definitional rulemaking at 75 FR 80174, Dec. 21, 

2010. 

rules.26 These corrections were (1) 

changing the word ‘‘market’’ to 

‘‘marketing’’ in § 162.3(a)(2); and (2) 

changing the word ‘‘includes’’ to 

‘‘include’’ in § 162.2(k). 

B. Disposal Rules 

Section 1088 of the Dodd-Frank Act 

also amends section 628 of the FCRA, 

which directs the Commission to adopt 

comparable and consistent rules with 

the Agencies regarding the disposal of 

sensitive consumer information. The 

purpose of these rules is to reduce the 

risk of identity theft and other consumer 

harm from improper disposal of a 

consumer report or any record derived 

from one. The Commission’s disposal 

rules 27 apply to certain Commissionregulated entities 28 that, for a business 

purpose, maintain or otherwise possess 

such consumer information.29

The general disposal requirement in 

§ 162.21(a), 17 CFR 162.21, provides 

that Commission-regulated entities 

adopt reasonable, written policies and 

procedures that address the 

administrative, technical, and physical 

safeguards for the protection of 

consumer information. 

A commenter suggested that the 

Commission remove language from the 

text of the Proposal, which requires 

disposal to take place ‘‘pursuant to a 

written disposal plan.’’ The commenter 

suggested that such language would be 

duplicative and possibly confusing 

because the Proposal already required 

‘‘written policies and procedures’’ for 

disposal. The commenter suggested that 

the removal of this language would 

further the conformity of this rule with 

the other Agencies’ rules. The 

Commission agrees and has removed the 

requirement that disposal take place 

‘‘pursuant to a written disposal plan’’ 

from the final rule text. 

The standard for disposal is flexible to 

allow these entities to determine what 

measures are reasonable based on the 

sensitivity of the information, the costs 

and benefits of different disposal 

methods, and relevant changes in 

technology over time. 

C. Compliance Dates 

In the Proposal, the Commission 

proposed to adopt part 162 on July 21, 

which was intended to coincide with 

the proposed effective date of the 

Commission’s amendments to part 160 

of its regulations.30 SIFMA requested 

that the Commission extend the 

effective date of the disposal and 

affiliate marketing rules from July 21, 

2011 to nine months after the date of 

publication.31 SIFMA argued that this 

would allow the covered entities 

enough time to come into compliance 

with the rules. 

The Commission partly agrees with 

SIFMA’s comment with respect to the 

new entities (i.e., SDs and MSPs) that 

must comply with the final rules. The 

effective date of the final rules will be 

60 days from the date of publication in 

the Federal Register. However, with 

respect to FCMs, IBs, CTAs, CPOs, and 

RFEDs, the Commission has decided to 

establish a compliance date of 120 days 

after the date of publication in the 

Federal Register. In making its decision, 

the Commission considered the amount 

of time that the other Agencies’ final 

rules gave to affected entities in order to 

comply with their respective rules. 

These Agencies gave their affected 

entities 120 months to comply with the 

provision of their respective rules. In 

addition, the Commission considered 

the fact that many of its regulated 

entities are currently required to adhere 

to the FTC’s disposal and affiliate 

marketing rules which are substantially 

identical. 

With respect to SDs and MSPs, the 

Commission has determined that these 

new entities shall have 60 days after the 

date of publication in the Federal 

Register of the final entities definitional 

rulemaking 32 to come into compliance 

with these rules. The Commission 

expects to approve and publish in the 

Federal Register the final entities 

definitional rulemaking at a date in the 

future. 

II. Cost-Benefit Considerations. 

Section 15(a) of the CEA explicitly 

requires the Commission to consider the 

costs and benefits of its actions before 

issuing a rule or order under the CEA. 

By its terms, section 15(a) neither 

requires the Commission to quantify the 

costs and benefits of amendments to 

regulations, nor does it require the 

Commission to determine whether the 

benefits of the amendments outweigh its 

costs. Section 15(a) specifies that the 

costs and benefits shall be evaluated in 

light of five broad areas of market and 

public concern: (1) Protection of market 

participants and the public; (2) 

efficiency, competitiveness and 

financial integrity of futures markets; (3) 

price discovery; (4) sound risk 

management practices; and (5) other 

public interest considerations. The 

Commission may in its discretion give 

greater weight to any one of the five 

enumerated areas and could in its 

discretion determine that, 

notwithstanding its costs, a particular 

amendment is necessary or appropriate 

to protect the public interest or to 

effectuate any of the provisions or 

accomplish any of the purposes of the 

CEA. 

Section 1088 of the Dodd-Frank Act 

provides the Commission with authority 

to implement rules under sections 624 

and 628 of the FCRA. In its Proposal, 

the Commission prescribed rules 

implementing section 624 of the FCRA, 

which requires certain Commissionregulated entities to provide consumers 

with the opportunity to prohibit 

affiliates from using certain information 

to make marketing solicitations to 

consumers. The Commission also 

prescribed rules implementing section 

628 of the FCRA, which requires certain 

Commission-regulated entities that 

possess or maintain consumer report 

information in connection with their 

business activities to develop and 

implement written policies and 

procedures for the proper disposal of 

such information. These proposed 

regulations would require CFTC 

registrants to do two things with respect 

to certain consumer information. The 

Commission proposed to (1) create a 

new part 162 of its regulations to 

include both the business affiliate rules 


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Federal Register / Vol. 76, No. 141 / Friday, July 22, 2011 / Rules and Regulations 43883 

33The Commission acknowledges that there will 

likely be an incremental cost in the aggregate in 

respect of those entities who do not currently 

comply with the Agencies’ similar regulations. The 

Commission believes that this incremental cost, 

however, is outweighed by the benefits that will 

accrue to the general public in terms of the privacy 

protections that will be afforded to their personal 

information. 

34See the Commission’s cost-benefit discussion 

and Paperwork Reduction Act analysis at 75 FR at 

66030–31. 

and the disposal rules and (2) require 

that this new part apply to the following 

Commission-regulated entities: FCMs; 

IBs; CTAs; CPOs; RFEDs; SDs; and 

MSPs. 

The cost-benefit discussion in the 

Proposal analyzed the costs and benefits 

of imposing new part 162 on these 

entities, most of which currently 

comply with substantially identical 

regulations imposed by the Agencies. 

With respect to costs, the Commission’s 

Proposal stated that the costs to 

aforementioned entities would be de 

minimis because: (1) The Commission is 

providing model notices in the 

proposed regulations in order to assist 

these participants in complying with the 

affiliate marketing rules; (2) the affiliate 

marketing rules only require periodic 

notice (i.e., at a maximum, companies 

would have to provide notice to a 

consumer once every five years; at a 

minimum, companies would have to 

provide notice only once per consumer); 

(3) market participants can file 

consolidated and equivalent notices in 

order to comply with the affiliate 

marketing rules; and (4) the disposal 

rules were designed to provide market 

participants with the greatest flexibility 

in the development and implementation 

of a disposal program (which may vary 

according to a company’s size and the 

complexity of its operations, the costs 

and benefits of available disposal 

methods, and the sensitivity of 

information involved). 

The Commission’s Proposal also set 

out the following potential costs to the 

general public: (1) Absent the 

implementation of the affiliate 

marketing rules, consumers would have 

no control over both the use of their 

personal information, and the number of 

solicitations such consumers would 

receive from affiliates of company with 

which they have a pre-existing business 

relationship; and (2) absent the 

implementation of the disposal rules, 

there would be an increased chance that 

consumer information would be 

accessible to third parties who may use 

such information for identity theft or 

other unlawful purposes. With respect 

to benefits, the Commission’s Proposal 

stated that, through the implementation 

of the affiliate marketing rules, 

consumers generally will be able to opt 

out of receiving unsolicited and targeted 

materials from businesses with which 

the consumers have no pre-existing 

business relationship. In addition, the 

Commission’s Proposal stated that, as a 

result of the implementation of the 

disposal rules, the potential for the 

misuse of consumer information will 

greatly decrease. 

In issuing final rules, the Commission 

has considered the costs and benefits 

referenced above in light of the 

comments received in response to its 

Proposal and the specific areas of 

concern identified in section 15(a). An 

analysis of the section 15(a) factors is set 

out immediately below, followed by a 

discussion of the comments received in 

response to the Commission’s costbenefit discussion in its Proposal. 

1. Protection of market participants 

and the public. The Commission 

believes that requiring certain 

Commission-regulated entities to 

provide opt-out notices and to protect 

customer information through disposal 

of such information will greatly benefit 

the general public by protecting the 

privacy of the public’s personal 

information. Similarly, the Commission 

believes that requiring Commissionregulated entities to ensure the 

protection of nonpublic personal 

information will reduce the litigation 

risk that these entities face related to 

privacy causes of action. The 

Commission further believes that the 

costs, which will be placed on its 

regulated entities, will be equal to or no 

greater than those costs that the 

Agencies currently impose on most of 

these entities under the Agencies’ 

similar regulations.33

2. Efficiency and competition. The 

Commission believes that the 

requirements to provide opt-out notices 

will benefit efficiency by reducing the 

number of solicitations sent to 

customers. The Commission’s final rules 

also will benefit efficiency and 

competition by providing Commissionregulated entities with flexibility in 

terms of how best to distribute opt-out 

notices and to adopt disposal policies 

and procedures to protect customer 

information. Ultimately, this flexibility 

will allow these entities to develop 

procedures that are best suited to each 

entity’s business and needs. As noted 

above, the Commission believes that the 

costs, which will be placed on these 

entities will be equal to or no greater 

than those costs currently placed on 

them under the Agencies’ similar 

regulations. 

3. Price discovery and financial 

integrity of futures and swaps markets, 

price discovery and sound risk 

management practices. The final rules 

should have no effect, from the 

standpoint of imposing costs or creating 

benefits, on the price discovery function 

or financial integrity of the futures and 

swaps markets or on the risk 

management practices of the 

Commission-regulated entities. 

4. Other public interest 

considerations. As noted above, part 162 

will provide these entities with 

maximum flexibility in designing their 

own compliance systems in a manner 

consistent with the legal requirements 

under the affiliate marketing rules and 

disposal rules. Ultimately, the 

Commission believes that requiring its 

entities to comply with the final affiliate 

marketing rules and disposal rules will 

harmonize privacy protections for 

individual customers across all financial 

markets regardless of whether those 

entities are regulated by the 

Commission or the other Agencies. 

5. Response to Comments. In its 

Proposal, the Commission solicited 

comment on its consideration of these 

costs and benefits. The Commission 

received one comment with respect to 

the cost and benefits analysis in its 

Proposal. Specifically, SIFMA argued 

that the Commission also should 

consider anticipated additional costs 

associated with monitoring the privacy 

and opt-out notice process, addressing 

consumer issues, and adjusting records 

to comport with consumer requests. 

SIFMA did not provide specific cost 

information related to these additional 

activities. Notwithstanding SIFMA’s 

assertion, the Commission notes that the 

additional activities and costs raised by 

SIFMA were subsumed within the 

considerations discussed in the 

Proposal.34

In line with Section 15(a) of the CEA, 

the Commission believes that 

prescribing final rules is in the public 

interest and will further protect market 

the general public, promote efficiency 

and competition, and address other 

public interest considerations such as 

the harmonization of regulation across 

financial markets, regardless of which 

Federal regulator oversees a financial 

entity. In the Commission’s view, these 

benefits far outweigh the additional 

costs that SIFMA cited. 

III. Paperwork Reduction Act 

Under the Paperwork Reduction Act 

of 1995 (‘‘PRA’’), 44 U.S.C. 3501 et seq., 

an agency may not conduct or sponsor, 

and a person is not required to respond 

to, a collection of information unless it 

displays a currently valid control 


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43884 Federal Register / Vol. 76, No. 141 / Friday, July 22, 2011 / Rules and Regulations 

35See the SIFMA letter at 4–5. 

36 5 U.S.C. 601 et seq. 

37 5 U.S.C. 601 et seq. 

38Previous determinations for FCMs at 47 FR 

18618, 18619, Apr. 30, 1982; CPOs at 47 FR 18618, 

18619, Apr. 30, 1982; and IBs at 48 FR 14933, 

14955, Apr. 6, 1983. 

number. The Commission’s final rule 

regarding the protection of consumer 

information under the Fair Credit 

Reporting Act results in information 

collection requirements within the 

meaning of the PRA. The Commission 

submitted the proposing release along 

with supporting documentation to the 

Office of Management and Budget 

(‘‘OMB’’) for review in accordance with 

44 U.S.C. 3507(d) and 5 CFR 1320.11. 

The Commission requested that OMB 

approve and assign a new control 

number for the collection of information 

required by the proposing release. 

In response to the Commission’s 

request in the proposing release for 

comments on any potential paperwork 

burden associated with both the 

proposed affiliate marketing and 

disposal rules, only SIFMA provided 

substantive comments addressing the 

merits of the Commission’s proposed 

PRA calculations.35 In particular, 

SIFMA proposed that the burden 

estimate for the affiliate marketing rules 

should be refined to account for burden 

hours associated with: (i) Monitoring 

the opt-out notice process; (ii) 

addressing consumer questions and 

concerns about opt-out notices; and (iii) 

adjusting records where a consumer 

changes his or her mind about his or her 

election to opt-in or out. In addition, 

SIFMA proposed that the burden 

estimate for the disposal rules should be 

refined to: (i) Revise disposal plans to 

account for use of new technology, new 

business processes, etc.; and (ii) conduct 

regular reviews of its disposal plan to 

determine when revisions are necessary 

or advisable. 

Based on these comments, the 

Commission estimates that 3,172 

covered entities may incur an additional 

3.5 burden hours when complying with 

the affiliate marketing rules, for an 

aggregate of 11,102 annual burden 

hours. These additional burden hours 

are attributable to monitoring the optout notice process, addressing consumer 

questions and concerns about opt-out 

notices, and adjusting customer records. 

In addition, the Commission estimates 

that 3,172 covered entities may incur an 

additional 2.4 burden hours when 

complying with the disposal rules, for 

an aggregate of 7,612.8 annual burden 

hours. These additional burden hours 

are attributable to revise and update 

disposal plans on an ongoing basis, and 

conduct regular reviews of its disposal 

plan as necessary or advisable. 

Accordingly, the Commission has 

submitted to the OMB an amended 

calculation of the annual burden hours 

for the final affiliate marketing and 

disposal rules. 

IV. Regulatory Flexibility Act 

The Regulatory Flexibility Act 

(‘‘RFA’’) 36 requires that Federal 

agencies consider whether the 

regulations they propose will have a 

significant economic impact on a 

substantial number of small entities 

and, if so, provide a regulatory 

flexibility analysis respecting the 

impact.37 The Commission’s final 

regulations will affect only FCMs, IBs, 

CTAs, CPOs, SDs, and MSPs. 

The regulations implementing section 

624 of the FCRA require abovereferenced CFTC-regulated entities to 

provide consumers with the opportunity 

to prohibit affiliates from using certain 

information to make marketing 

solicitations to consumers. The 

regulations implementing section 628 of 

the FCRA require the above-referenced 

CFTC-regulated entities that possess or 

maintain consumer report information 

in connection with their business 

activities to develop and implement a 

written program for the proper disposal 

of such information. The Commission 

certified in the Proposal that these rules 

will not have a significant economic 

impact on a substantial number of small 

entities. The Commission did not 

receive any substantive comments to its 

RFA analysis in relation to the Proposal. 

Moreover, the Commission previously 

determined that FCMs, CPOs, and IBs 

are not small entities for purposes of the 

RFA.38 Therefore, nothing alters the 

Commission’s determination in the 

Proposal that the obligations created by 

these rules will not create a significant 

economic impact on a substantial 

number of small entities. 

V. Text of Final Rules 

List of Subjects in 17 CFR Part 162 

Brokers, Dealers, Consumer 

protection, Privacy, Reporting and 

recordkeeping. 

For the reasons stated in the 

preamble, the Commodity Futures 

Trading Commission adds 17 CFR part 

162 to read as follows: 

PART 162—PROTECTION OF 

CONSUMER INFORMATION UNDER 

THE FAIR CREDIT REPORTING ACT 

Sec. 

162.1 Purpose and scope. 

162.2 Definitions. 

Subpart A—Business Affiliate Marketing 

Rules 

162.3 Affiliate marketing opt out and 

exceptions. 

162.4 Scope and duration of opt out. 

162.5 Contents of opt-out notice; 

consolidated and equivalent notices. 

162.6 Reasonable opportunity to opt out. 

162.7 Reasonable and simple methods of 

opting out. 

162.8 Acceptable delivery of opt-out notices 

162.9 Renewal of opt out. 

162.10–162.20 [Reserved.] 

Subpart B—Disposal Rules 

162.21 Proper disposal of consumer 

information. 

Appendix A to Part 162—Sample Clauses 

Authority: Sec. 1088, Pub. L. 111–203; 124 

Stat. 1376 (2010). 

§ 162.1 Purpose and scope. 

(a) Purpose. The purpose of this part 

is to implement various provisions in 

the Fair Credit Reporting Act, 15 U.S.C. 

1681, et seq. (‘‘FCRA’’), which provide 

certain protections to consumer 

information. 

(b) Scope. This part applies to certain 

consumer information held by the 

entities listed below. This part shall 

apply to futures commission merchants, 

retail foreign exchange dealers, 

commodity trading advisors, commodity 

pool operators, introducing brokers, 

major swap participants and swap 

dealers, regardless of whether they are 

required to register with the 

Commission. This part does not apply to 

foreign futures commission merchants, 

foreign retail foreign exchange dealers, 

commodity trading advisors, commodity 

pool operators, introducing brokers, 

major swap participants and swap 

dealers unless such entity registers with 

the Commission. Nothing in this part 

modifies limits or supersedes the 

requirements set forth in part 160 of this 

title. 

(c) Examples. The examples in this 

part are not exclusive. Compliance with 

an example, to the extent applicable, 

constitutes compliance with this part. 

Examples in a section illustrate only the 

issue described in the section and do 

not illustrate any other issue that may 

arise in this part. 

§ 162.2 Definitions. 

(a) Affiliate. The term ‘‘affiliate’’ for 

the purposes of this part means any 

person that is related by common 

ownership or common corporate control 

with a covered affiliate. 

(b) Clear and conspicuous. The term 

‘‘clear and conspicuous’’ means 

reasonably understandable and 

designed to call attention to the nature 

and significance of the information 

presented in the notice. 


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Federal Register / Vol. 76, No. 141 / Friday, July 22, 2011 / Rules and Regulations 43885 

(c) Common ownership or common 

corporate control. The term ‘‘common 

ownership or common corporate 

control’’ for the purposes of this part 

means the power to exercise a 

controlling influence over the 

management or policies of a company 

whether through ownership of 

securities, by contract, or otherwise. 

Any person who owns beneficially, 

either directly or through one or more 

controlled companies, more than 25 

percent of the voting securities of any 

company is presumed to control the 

company. Any person who does not 

own more than 25 percent of the voting 

securities of a company will be 

presumed not to control the company. 

(d) Company. The term ‘‘company’’ 

means any corporation, limited liability 

company, business trust, general or 

limited partnership, association, or 

similar organization. 

(e) Concise.— 

(1) In general. The term ‘‘concise’’ 

means a reasonably brief expression or 

statement. 

(2) Combination with other required 

disclosures. A notice required by this 

part may be concise even if it is 

combined with other disclosures 

required or authorized by Federal or 

state law. 

(f) Consumer. Except as otherwise 

provided, the term ‘‘consumer’’ means 

an individual person. The term 

consumer does not include market 

makers, floor brokers, locals, or 

individual persons whose information is 

not collected to determine eligibility for 

personal, family, or household 

purposes. 

(g) Consumer information. The term 

‘‘consumer information’’ means any 

record about an individual, whether in 

paper, electronic, or other form, that is 

a consumer report or is derived from a 

consumer report (as defined in section 

603(d)(2) of the FCRA). Consumer 

information also means a compilation of 

such records. Consumer information 

does not include information that does 

not identify individuals, such as 

aggregate information or blind data. 

(h) Covered affiliate. The term 

‘‘covered affiliate’’ means a futures 

commission merchant, retail foreign 

exchange dealer, commodity trading 

advisor, commodity pool operator, 

introducing broker, major swap 

participant or swap dealer, which is 

subject to the jurisdiction of the 

Commission. 

(i) Dispose or Disposal.— 

(1) In general. The terms ‘‘dispose’’ or 

‘‘disposal’’ means: 

(i) The discarding or abandonment of 

consumer information; or 

(ii) The sale, donation, or transfer of 

any medium, including computer 

equipment, upon which consumer 

information is stored. 

(2) Sale, donation, or transfer of 

consumer information. The sale, 

donation, or transfer of consumer 

information is not considered disposal 

for the purposes of subpart B. 

(j) Dodd-Frank Act. The term ‘‘DoddFrank Act’’ means the Dodd-Frank Wall 

Street Reform and Consumer Protection 

Act (Pub. L. 111–203, 124 Stat. 1376 

(2010)). 

(k) Eligibility information. The term 

‘‘eligibility information’’ means any 

information that would be a consumer 

report if the exclusions from the 

definition of ‘‘consumer report’’ in 

section 603(d)(2)(A) of the FCRA did not 

apply. Examples of the type of 

information that would fall within the 

definition of eligibility information 

include an affiliate’s own transaction or 

experience information, such as 

information about a consumer’s account 

history with that affiliate, and other 

information, such as information from 

credit bureau reports or applications. 

Eligibility information does not include 

aggregate or blind data that does not 

contain personal identifiers such as 

account numbers, names, or addresses. 

(l) FCRA. The term ‘‘FCRA’’ means 

the Fair Credit Reporting Act (15 U.S.C. 

1681 et seq.). 

(m) Financial product or service. The 

term ‘‘financial product or service’’ 

means any product or service that a 

futures commission merchant, retail 

foreign exchange dealer, commodity 

trading advisor, commodity pool 

operator, introducing broker, major 

swap participant or swap dealer could 

offer that is subject to the Commission’s 

jurisdiction. 

(n) GLB Act. The term ‘‘GLB Act’’ 

means the Gramm-Leach-Bliley Act 

(Pub. L. 106–102, 113 Stat. 1338 (1999)). 

(o) Major swap participant. The term 

‘‘major swap participant’’ has the same 

meaning as in section 1a(33) of the 

Commodity Exchange Act, 7 U.S.C. 1 et 

seq., as may be further defined by this 

title, and includes any person registered 

as such thereunder. 

(p) Person. The term ‘‘person’’ means 

any individual, partnership, 

corporation, trust, estate, cooperative, 

association, or other entity. 

(q) Pre-existing business relationship. 

The term ‘‘pre-existing business 

relationship’’ means a relationship 

between a person, or a person’s licensed 

agent, and a consumer based on— 

(1) A financial contract between the 

person and the consumer which is in 

force on the date on which the 

consumer is sent a solicitation by this 

part; 

(2) The purchase, rental, or lease by 

the consumer of a persons’ services or 

a financial transaction (including 

holding an active account or policy in 

force or having another continuing 

relationship) between the consumer and 

the person, during the 18-month period 

immediately preceding the date on 

which the consumer is sent a 

solicitation covered by this part; or 

(3) An inquiry or application by the 

consumer regarding a financial product 

or service offered by that person during 

the three-month period immediately 

preceding the date on which the 

consumer is sent a solicitation covered 

by this part. 

(r) Solicitation—(1) In general. The 

term ‘‘solicitation’’ means the marketing 

of a financial product or service 

initiated by an affiliate to a particular 

consumer that is— 

(i) Based on eligibility information 

communicated to that covered affiliate 

by an affiliate that has or previously had 

the pre-existing business relationship 

with a consumer as described in this 

part; and 

(ii) Intended to encourage the 

consumer to purchase or obtain such 

financial product or service. A 

solicitation does not include marketing 

communications that are directed at the 

general public. 

(2) Examples. Examples of what 

communications constitute solicitations 

include communications such as a 

telemarketing solicitation, direct mail, 

or e-mail, when those communications 

are directed to a specific consumer 

based on eligibility information. A 

solicitation does not include 

communications that are directed at the 

general public without regard to 

eligibility information, even if those 

communications are intended to 

encourage consumers to purchase 

financial products and services from the 

affiliate initiating the communications. 

(s) Swap dealer. The term ‘‘swap 

dealer’’ has the same meaning as in 

section 1a(49) of the Commodity 

Exchange Act, 7 U.S.C. 1 et seq., as may 

be further defined by this title, and 

includes any person registered as such 

thereunder. 

Subpart A—Business Affiliate 

Marketing Rules 

§ 162.3 Affiliate marketing opt out and 

exceptions. 

(a) Initial notice and opt out. A 

covered affiliate may not use eligibility 

information about a consumer that the 

covered affiliate receives from an 

affiliate with the consumer to make a 


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43886 Federal Register / Vol. 76, No. 141 / Friday, July 22, 2011 / Rules and Regulations 

solicitation for marketing purposes to 

such consumer unless— 

(1) It is clearly and conspicuously 

disclosed to the consumer in writing or 

if the consumer agrees, electronically, in 

a concise notice that the person may use 

shared eligibility information about that 

consumer received from an affiliate to 

make solicitations for marketing 

purposes to such consumer; 

(2) The consumer is provided a 

reasonable opportunity and a reasonable 

and simple method to opt out, or 

prohibit the covered affiliate from using 

eligibility information to make 

solicitations for marketing purposes to 

the consumer; and 

(3) The consumer has not opted out. 

(b) Persons responsible for satisfying 

the notice requirement. The notice 

required by this section must be 

provided: 

(1) By an affiliate that has or 

previously had a pre-existing business 

relationship with a consumer; or 

(2) As part of a joint notice from two 

or more members of an affiliated group 

of companies, provided that at least one 

of the affiliates on the joint notice has 

or previously had a pre-existing 

business relationship with the 

consumer. 

(c) Exceptions. These proposed 

regulations would not apply to the 

following covered affiliate: 

(1) A covered affiliate that has a preexisting business relationship with a 

consumer; 

(2) Communications between an 

employer and employee-consumer (or 

his or her beneficiary) in connection 

with an employee benefit plan; 

(3) A covered affiliate that is currently 

providing services to the consumer; 

(4) If the consumer initiated the 

communication with the covered 

affiliate by oral, electronic, or written 

means; 

(5) If the consumer authorized or 

requested the covered affiliate’s 

solicitation; or 

(6) If compliance by a person with 

these regulations would prevent that 

person’s compliance with state 

insurance laws pertaining to unfair 

discrimination. 

(d) Making solicitations. 

(1) When a solicitation occurs. A 

covered affiliate makes a solicitation for 

marketing purposes if the person— 

(i) Receives eligibility information 

from an affiliate; 

(ii) Uses that eligibility information to 

do one or more of the following: 

(A) Identify the consumer or type of 

consumer to receive a solicitation; 

(B) Establish criteria used to select the 

consumer to receive a solicitation about 

the covered affiliate’s financial products 

or services; or 

(C) Decide which of the services or 

contracts to market to the consumer or 

tailor the solicitation to that consumer; 

and 

(iii) As a result of the covered 

affiliate’s use of the eligibility 

information, the consumer is provided a 

solicitation. 

(2) Receipt of eligibility information. 

A covered affiliate may receive 

eligibility information from an affiliate 

in various ways, including when the 

affiliate places that information into a 

common database that the covered 

affiliate may access. 

(3) Service Providers. Except as 

provided in paragraph (d)(5) of this 

section, a covered affiliate receives or 

uses an affiliate’s eligibility information 

if a service provider acting on the 

covered affiliate’s behalf (regardless of 

whether such service provider is a third 

party or an affiliate of the covered 

affiliate) receives or uses that 

information in the manner described in 

paragraph (d)(1)(i) or (d)(1)(ii) of this 

section. All relevant facts and 

circumstances will determine whether a 

service provider is acting on behalf of a 

covered affiliate when it receives or uses 

an affiliate’s eligibility information in 

connection with marketing the covered 

affiliate’s financial products or services. 

(4) Use by an affiliate of its own 

eligibility information. Unless a covered 

affiliate uses eligibility information that 

the covered affiliate receives from an 

affiliate in the manner described in 

paragraph (d)(2) of this section, the 

covered affiliate does not make a 

solicitation subject to this subpart: 

(i) Uses its own eligibility information 

that it obtained in connection with a 

pre-existing business relationship it has 

or previously had with the consumer to 

market the covered affiliate’s financial 

products or services to the consumer; or 

(ii) Directs its service provider to use 

the affiliate’s own eligibility information 

that it obtained in connection with a 

pre-existing business relationship it has 

or previously had with the consumer to 

market the covered affiliate’s financial 

products or services to the consumer, 

and the covered affiliate does not 

communicate directly with the service 

provider regarding that use. 

(5) Use of eligibility information by a 

service provider. (i) In general. A 

covered affiliate does not make a 

solicitation subject to this subpart if a 

service provider (including an affiliated 

or third-party service provider that 

maintains or accesses a common 

database that the covered affiliate may 

access) receives eligibility information 

from an affiliate that has or previously 

had a pre-existing business relationship 

with the consumer and uses that 

eligibility information to market the 

covered affiliate’s financial products or 

services to the consumer, so long as— 

(A) The affiliate controls access to and 

use of its eligibility information by the 

service provider (including the right to 

establish the specific terms and 

conditions under which the service 

provider may use such information to 

market the covered affiliate’s financial 

products or services); 

(B) The affiliate establishes specific 

terms and conditions under which the 

service provider may access and use 

such affiliate’s eligibility information to 

market the covered affiliate’s financial 

products and services (or those of 

affiliates generally) to the consumer, 

such as the identity of the affiliated 

companies whose financial products or 

services may be marketed to the 

consumer by the service provider, the 

types of financial products or services of 

affiliated companies that may be 

marketed, and the number of times the 

consumer may receive marketing 

materials, and periodically evaluates the 

service provider’s compliance with 

those terms and conditions; 

(C) The affiliate requires the service 

provider to implement reasonable 

policies and procedures designed to 

ensure that the service provider uses 

such affiliate’s eligibility information in 

accordance with the terms and 

conditions established by such affiliate 

relating to the marketing of the covered 

affiliate’s financial products or services; 

(D) The affiliate is identified on or 

with the marketing materials provided 

to the consumer; and 

(E) The covered affiliate does not 

directly use its affiliate’s eligibility 

information in the manner described in 

paragraph (b)(1)(ii) of this section. 

(ii) Writing requirements. (A) The 

requirements of paragraphs (b)(5)(i)(A) 

and (C) of this section must be set forth 

in a written agreement between the 

affiliate that has or previously had a preexisting business relationship with the 

consumer and the service provider; and 

(B) The specific terms and conditions 

established by the affiliate as provided 

in paragraph (b)(5)(i)(B) of this section 

must be set forth in writing. 

(e) Relation to affiliate-sharing notice 

and opt out. Nothing in this rulemaking 

will limit the responsibility of a covered 

affiliate to comply with the notice and 

opt-out provisions under other privacy 

rules under the FCRA, the GLB Act or 

the CEA. 

§ 162.4 Scope and duration of opt out. 

(a) Scope of opt-out election-(1) In 

general. The consumer’s election to opt 

out prohibits any covered affiliate 

subject to the scope of the opt-out notice 


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Federal Register / Vol. 76, No. 141 / Friday, July 22, 2011 / Rules and Regulations 43887 

from using eligibility information 

received from another affiliate to make 

solicitations to the consumer. 

(2) Continuing relationship-(i) In 

general. If the consumer establishes a 

continuing relationship with a covered 

affiliate or its affiliate, an opt-out notice 

may apply to eligibility information 

obtained in connection with— 

(A) A single continuing relationship 

or multiple continuing relationships 

that the consumer establishes with a 

covered affiliate or its affiliates, 

including continuing relationships 

established subsequent to delivery of 

the opt-out notice, so long as the notice 

adequately describes the continuing 

relationships covered by the opt out; or 

(B) Any other transaction between the 

consumer and the covered affiliate or its 

affiliates as described in the notice. 

(ii) Examples of a continuing 

relationship. A consumer has a 

continuing relationship with a covered 

affiliate or its affiliate if: 

(A) The covered affiliate is a futures 

commission merchant through whom a 

consumer has opened an account, or 

that carries the consumer’s account on 

a fully-disclosed basis, or that effects or 

engages in commodity interest 

transactions with or for a consumer, 

even if the covered affiliate does not 

hold any assets of the consumer; 

(B) The covered affiliate is an 

introducing broker that solicits or 

accepts specific orders for trades; 

(C) The covered affiliate is a 

commodity trading advisor with whom 

a consumer has a contract or 

subscription, either written or oral, 

regardless of whether the advice is 

standardized, or is based on, or tailored 

to, the commodity interest or cash 

market positions or other circumstances 

or characteristics of the particular 

consumer; 

(D) The covered affiliate is a 

commodity pool operator, and accepts 

or receives from the consumer, funds, 

securities, or property for the purpose of 

purchasing an interest in a commodity 

pool; 

(E) The covered affiliate is a major 

swap participant that holds securities or 

other assets as collateral for a loan made 

to the consumer, even if the covered 

affiliate did not make the loan or do not 

affect any transactions on behalf of the 

consumer; or 

(F) The covered affiliate is a swap 

dealer that regularly effects or engages 

in swap transactions with or for a 

consumer even if the covered affiliate 

does not hold any assets of the 

consumer. 

(3) No continuing relationship. (i) In 

general. If there is no continuing 

relationship between a consumer and 

the covered affiliate or its affiliate, and 

the covered affiliate or its affiliate obtain 

eligibility information about a consumer 

in connection with a transaction with 

the consumer, such as an isolated 

transaction or a credit application that 

is denied, an opt-out notice provided to 

the consumer only applies to eligibility 

information obtained in connection 

with that transaction. 

(ii) Examples of no continuing 

relationship. A consumer does not have 

a continuing relationship with a covered 

affiliate or its affiliate if: 

(A) The covered affiliate has acted 

solely as a ‘‘finder’’ for a futures 

commission merchant, and the covered 

affiliate does not solicit or accept 

specific orders for trades; or 

(B) The covered affiliate has solicited 

the consumer to participate in a pool or 

to direct his or her account and he or 

she has not provided the covered 

affiliate with funds to participate in a 

pool or entered into any agreement with 

the covered affiliate to direct his or her 

account. 

(4) Menu of alternatives. A consumer 

may be given the opportunity to choose 

from a menu of alternatives when 

electing to prohibit solicitations, such as 

by electing to prohibit solicitations from 

certain types of affiliates covered by the 

opt-out notice but not other types of 

affiliates covered by the notice, electing 

to prohibit solicitations based on certain 

types of eligibility information but not 

other types of eligibility information, or 

electing to prohibit solicitations by 

certain methods of delivery but not 

other methods of delivery. However, 

one of the alternatives must allow the 

consumer to prohibit all solicitations 

from all of the affiliates that are covered 

by the notice. 

(5) Special rule for a notice following 

termination of all continuing 

relationships. A consumer must be 

given a new opt-out notice if, after all 

continuing relationships with the 

covered affiliate or its affiliate(s) are 

terminated, the consumer subsequently 

establishes another continuing 

relationship with the covered affiliate or 

its affiliate(s) and the consumer’s 

eligibility information is to be used to 

make a solicitation. The new opt-out 

notice must apply, at a minimum, to 

eligibility information obtained in 

connection with the new continuing 

relationship. Consistent with paragraph 

b of this section, the consumer’s 

decision not to opt out after receiving 

the new opt-out notice would not 

override a prior opt-out election by the 

consumer that applies to eligibility 

information obtained in connection 

with a terminated relationship, 

regardless of whether the new opt-out 

notice applies to eligibility information 

obtained in connection with the 

terminated relationship. 

(b) Duration of opt-out election. An 

opt-out election must be effective for a 

period of at least five years beginning 

when the consumer’s opt-out election is 

received and implemented, unless the 

consumer subsequently revokes the optout election in writing or, if the 

consumer agrees, electronically. An optout election may be established for a 

period of more than five years or for an 

indefinite period unless revoked. 

(c) Time period in which a consumer 

can opt out. A consumer may opt out at 

any time. 

(d) No effect on opt-out period. An 

opt-out period may not be shortened by 

sending a renewal notice to the 

consumer before expiration of the optout period, even if the consumer does 

not renew the opt out. 

§ 162.5 Contents of opt-out notice; 

consolidated and equivalent notices. 

(a) Contents of the opt-out notice. (1) 

In general. An opt-out notice must be in 

writing, be clear and conspicuous, as 

well as concise, and must accurately 

disclose the following: 

(i) (A) The name of the affiliate that 

has or previously had a pre-existing 

business relationship with a consumer, 

which is providing the notice; or 

(B) If jointly provided jointly by 

multiple affiliates and each affiliate 

shares a common name, then the notice 

may indicate that it is being provided by 

multiple companies with the same name 

or multiple companies in the same 

group or family of companies. If the 

affiliates providing the notice do not 

share a common name, then the notice 

must either separately identify each 

affiliate by name or identify each of the 

common names used by those affiliates; 

(ii) The list of affiliates or types of 

affiliates whose use of eligibility 

information is covered by the notice, 

which may include companies that 

become affiliates after the notice is 

provided to the consumer; 

(iii) A general description of the types 

of eligibility information that may be 

used to make solicitations to the 

consumer; 

(iv) A statement that the consumer 

may elect to limit the use of eligibility 

information to make solicitations to the 

consumer; 

(v) A statement that the consumer’s 

election will apply for the specified 

period of time and, if applicable, that 

the consumer will be allowed to renew 

the election once that period expires; 

(vi) If the notice is provided to 

consumers who have previously elected 

to opt out, that such consumer does not 


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43888 Federal Register / Vol. 76, No. 141 / Friday, July 22, 2011 / Rules and Regulations 

need to act again until the consumer 

receives a renewal notice; and 

(vii) A reasonable and simple method 

for the consumer to opt out. 

(2) Specifying length of time period. If 

consumer is granted an opt-out period 

longer than a five-year duration, the optout notice must specify the length of the 

opt-out period. 

(3) No revised notice for extension of 

opt-out period. The duration of an optout period may be increased for a period 

longer than the period specified in the 

opt-out notice without having to 

provide a revised notice of the increase 

to the consumer. 

(b) Joint relationships. (1) If two or 

more consumers jointly obtain a 

financial product or service, a single 

opt-out notice may be provided to joint 

consumers. 

(2) Any of the joint consumers may 

exercise the right to opt out on behalf 

of each joint consumer. 

(3) The opt-out election notice must 

explain how an opt-out election by a 

joint consumer will be treated. That is, 

the notice should specify whether an 

opt-out election by a joint consumer 

will be treated as applying to all of the 

associated joint consumers, or as 

applying to each joint consumer 

separately. 

(4) If the opt-out election notice 

provides that each joint consumer is 

permitted to opt out separately, one of 

the joint consumers must be permitted 

to opt out on behalf of all of the joint 

consumers and the joint consumer must 

be permitted to exercise his or her 

separate rights to opt out in a single 

response. 

(5) A covered affiliate cannot require 

all joint consumers to opt out before 

implementing any opt-out election. 

(c) Alternative contents. If the 

consumer is afforded a broader right to 

opt out of receiving marketing than is 

required by this subpart, the 

requirements of this section may be 

satisfied by providing the consumer 

with a clear, conspicuous, and concise 

notice that accurately discloses the 

consumer’s opt-out rights. 

(d) Coordinated and consolidated 

consumer notices. A notice required by 

this subpart may be coordinated and 

consolidated with any other notice or 

disclosure required to be issued under 

any other provision of law by the 

covered affiliate providing the notice, 

including but not limited to notices in 

the FCRA or the GLB Act privacy 

notices. 

(e) Equivalent notices. A notice or 

disclosure that is equivalent to the 

notice required by this part in terms of 

content, and that is provided to a 

consumer together with a notice 

required by any other provision of law, 

satisfies the requirements of this 

section. 

(f) Model notices. Model notices are 

provided in Appendix A of this part. 

These notices were meant to facilitate 

compliance with this subpart; provided, 

however, that nothing herein shall be 

interpreted to require persons subject to 

this part to use the model notices. 

§ 162.6 Reasonable opportunity to opt out. 

(a) In general. A covered affiliate must 

not use eligibility information about a 

consumer that the covered affiliate 

receives from an affiliate to make a 

solicitation to such consumer about the 

covered affiliate’s financial products or 

services, unless the consumer is 

provided a reasonable opportunity to 

opt out, as required by this subpart. 

(b) Examples. A reasonable 

opportunity to opt out under this 

subpart is: 

(1) If the opt-out notice is mailed to 

the consumer, the consumer has 30 days 

from the date the notice is mailed to opt 

out. 

(2) If the opt-out notice is sent via 

electronic means to the consumer, the 

consumer has 30 days from the date the 

consumer acknowledges receipt to elect 

to opt out by any reasonable method. 

(3) If the opt-out notice is sent via email (where the consumer has agreed to 

receive disclosures by e-mail), the 

consumer is given 30 days after the email is sent to elect to opt out by any 

reasonable method. 

(4) If the opt-out notice provided to 

the consumer at the time of an 

electronic transaction, the consumer is 

required to decide, as a necessary part 

of proceeding with the transaction, 

whether to opt out before completing 

the transaction. 

(5) If the opt-out notice is provided 

during an in-person transaction, the 

consumer is required to decide, as a 

necessary part of completing the 

transaction, whether to opt out through 

a simple process. 

(6) If the opt-out notice is provided in 

conjunction with other privacy notices 

required by law, the consumer is 

allowed to exercise the opt-out election 

within a reasonable period of time and 

in the same manner as the opt out under 

that privacy notice. 

§ 162.7 Reasonable and simple methods of 

opting out. 

(a) In general. A covered affiliate shall 

be prohibited from using eligibility 

information about a consumer received 

from an affiliate to make a solicitation 

to the consumer about the covered 

affiliate’s financial products or services, 

unless the consumer is provided a 

reasonable and simple method to opt 

out, as required by this subpart. 

(b) Examples. Reasonable and simple 

methods of opting out include: 

(1) Designating a check-off box in a 

prominent position on an opt-out 

election form; 

(2) Including a reply form and a selfaddressed envelope (in a mailing); 

(3) Providing an electronic means, if 

the consumer agrees, that can be 

electronically mailed or processed 

through an Internet Web site; 

(4) Providing a toll-free telephone 

number; or 

(5) Exercising an opt-out election 

through whatever means are acceptable 

under a consolidated privacy notice 

required under other laws. 

(c) Specific opt-out method. Each 

consumer may be required to opt out 

through a specific method, as long as 

that method is acceptable under this 

subpart. 

§ 162.8 Acceptable delivery methods of 

opt-out notices. 

(a) In general. The opt-out notice must 

be provided so that each consumer can 

reasonably be expected to receive actual 

notice. 

(b) Electronic notices. For opt-out 

notices provided electronically, the 

notice may be provided in compliance 

with either the electronic disclosure 

provisions in § 1.4 of this title or the 

provisions in section 101 of the 

Electronic Signatures in Global and 

National Commerce Act, 15 U.S.C. 7001 

et seq. 

§ 162.9 Renewal of opt out. 

(a) Renewal notice and opt-out 

requirement. (1) In general. Since the 

FCRA provides that opt-out elections 

can expire in a period of no less than 

five years, an affiliate that has or 

previously had a pre-existing business 

relationship with a consumer must 

provide a renewal notice to the 

consumer after such time in order to 

allow its affiliates to make solicitations. 

After the opt-out election period 

expires, its affiliates may make 

solicitations unless: 

(i) The consumer has been given a 

renewal notice that complies with the 

requirements of this section and 

§§ 162.6 through 162.8 of this subpart, 

and a reasonable opportunity and a 

reasonable and simple method to renew 

the opt-out election, and the consumer 

does not renew the opt out; or 

(ii) An exception in Sec. 162.3(c) of 

this subpart applies. 

(2) Renewal period. Each opt-out 

renewal must be effective for a period of 

at least five years as provided in 

§ 162.4(b) of this subpart. 


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Federal Register / Vol. 76, No. 141 / Friday, July 22, 2011 / Rules and Regulations 43889 

(3) Affiliates who may provide the 

renewal notice. The notice required by 

this paragraph must be provided: 

(i) By the affiliate that provided the 

previous opt-out notice, or its successor; 

or 

(ii) As part of a joint renewal notice 

from two or more members of an 

affiliated group of companies, or their 

successors, that jointly provided the 

previous opt-out notice. 

(b) Contents of renewal or extension 

notice. The contents of the renewal 

notice must include all of the same 

contents of the initial notices, but also 

must include: 

(1) A statement that the consumer 

previously elected to limit the use of 

certain information to make solicitations 

to the consumer; 

(2) A statement that the consumer 

may elect to renew the consumer’s 

previous election; and 

(3) If applicable, a statement that the 

consumer’s election to renew will apply 

for a specified period of time stated in 

the notice and that the consumer will be 

allowed to renew the election once that 

period expires. 

(c) Timing of renewal notice. Renewal 

notices must be provided in a 

reasonable period of time before the 

expiration of the opt-out election period 

or any time after the expiration of the 

opt-out period, but before solicitations 

that would have been prohibited by the 

expired opt-out election are made to the 

consumer. 

(d) No effect on opt-out period. An 

opt-out period may not be shortened by 

sending a renewal notice to the 

consumer before the expiration of the 

opt-out period, even if the consumer 

does not renew the opt-out election. 

§§ 162.10–162.20 [Reserved.] 

Subpart B—Disposal Rules 

§ 162.21 Proper disposal of consumer 

information. 

(a) In general. Any covered affiliate 

must adopt must adopt reasonable, 

written policies and procedures that 

address administrative, technical, and 

physical safeguards for the protection of 

consumer information. These written 

policies and procedures must be 

reasonably designed to: 

(1) Insure the security and 

confidentiality of consumer 

information; 

(2) Protect against any anticipated 

threats or hazards to the security or 

integrity of consumer information; and 

(3) Protect against unauthorized 

access to or use of consumer 

information that could result in 

substantial harm or inconvenience to 

any consumer. 

(b) Standard. Any covered affiliate 

under this part who maintains or 

otherwise possesses consumer 

information for a business purpose must 

properly dispose of such information by 

taking reasonable measures to protect 

against unauthorized access to or use of 

the information in connection with its 

disposal. 

(c) Examples. The following examples 

are ‘‘reasonable’’ disposal measures for 

the purposes of this subpart— 

(1) Implementing and monitoring 

compliance with policies and 

procedures that require the burning, 

pulverizing, or shredding of papers 

containing consumer information so 

that the information cannot practicably 

be read or reconstructed; 

(2) Implementing and monitoring 

compliance with policies and 

procedures that require the destruction 

or erasure of electronic media 

containing consumer information so 

that the information cannot practically 

be read or reconstructed; and 

(3) After due diligence, entering into 

and monitoring compliance with a 

written contract with another party 

engaged in the business of record 

destruction to dispose of consumer 

information in a manner that is 

consistent with this rule. 

(d) Relation to other laws. Nothing in 

this section shall be construed: 

(1) To require a person to maintain or 

destroy any record pertaining to a 

consumer that is imposed under Sec. 

1.31 or any other provision of law; or 

(2) To alter or affect any requirement 

imposed under any other provision of 

law to maintain or destroy such a 

record. 

Appendix A to Part 162—Sample 

Clauses 

A. Although use of the model forms is not 

required, use of the model forms in this 

Appendix (as applicable) complies with the 

requirement in section 624 of the FCRA for 

clear, conspicuous, and concise notices. 

B. Certain changes may be made to the 

language or format of the model forms 

without losing the protection from liability 

afforded by use of the model forms. These 

changes may not be so extensive as to affect 

the substance, clarity, or meaningful 

sequence of the language in the model forms. 

Persons making such extensive revisions will 

lose the safe harbor that this Appendix 

provides. Acceptable changes include, for 

example: 

1. Rearranging the order of the references 

to ‘‘your income’’, ‘‘your account history’’, 

and ‘‘your credit score’’. 

2. Substituting other types of information 

for ‘‘income’’, ‘‘account history’’, or ‘‘credit 

score’’ for accuracy, such as ‘‘payment 

history’’, ‘‘credit history’’, or ‘‘claims 

history’’. 

3. Substituting a clearer and more accurate 

description of the affiliates providing or 

covered by the notice for phrases such as 

‘‘the [ABC] group of companies,’’ including 

without limitation a statement that the entity 

providing the notice recently purchased the 

consumer’s account. 

4. Substituting other types of affiliates 

covered by the notice for ‘‘commodity 

advisor’’, ‘‘futures clearing merchant’’, or 

‘‘swap dealer’’ affiliates. 

5. Omitting items that are not accurate or 

applicable. For example, if a person does not 

limit the duration of the opt-out period, the 

notice may omit information about the 

renewal notice. 

6. Adding a statement informing 

consumers how much time they have to opt 

out before shared eligibility information may 

be used to make solicitations to them. 

7. Adding a statement that the consumer 

may exercise the right to opt out at any time. 

8. Adding the following statement, if 

accurate: ‘‘If you previously opted out, you 

do not need to do so again.’’ 

9. Providing a place on the form for the 

consumer to fill in identifying information, 

such as his or her name and address. 

• A–1 Model Form for Initial Opt-out 

notice (Single-Affiliate Notice) 

• A–2 Model Form for Initial Opt-out 

notice (Joint Notice) 

• A–3 Model Form for Renewal Notice 

(Single-Affiliate Notice) 

• A–4 Model Form for Renewal Notice 

(Joint Notice) 

• A–5 Model Form for Voluntary ‘‘No 

Marketing’’ Notice 

A–1 Model Form for Initial Opt-Out Notice 

(Single-Affiliate Notice) 

[Your Choice To Limit Marketing]/ 

[Marketing Opt Out] 

—[Name of Affiliate] is providing this notice. 

—[Optional: Federal law gives you the right 

to limit some but not all marketing from 

our affiliates. Federal law also requires us 

to give you this notice to tell you about 

your choice to limit marketing from our 

affiliates.] 

—You may limit our affiliates in the [ABC] 

group of companies, such as our 

[commodity advisor, futures clearing 

merchant, and swap dealer] affiliates, from 

marketing their financial products or 

services to you based on your personal 

information that we collect and share with 

them. This information includes your 

[income], your [account history with us], 

and your [credit score]. 

—Your choice to limit marketing offers from 

our affiliates will apply [until you tell us 

to change your choice]/[for x years from 

when you tell us your choice]/[for at least 

5 years from when you tell us your choice]. 

[Include if the opt-out period expires.] 

Once that period expires, you will receive 

a renewal notice that will allow you to 

continue to limit marketing offers from our 

affiliates for [another x years]/[at least 

another 5 years]. 

—[Include, if applicable, in a subsequent 

notice, including an annual notice, for 

consumers who may have previously opted 

out.] If you have already made a choice to 

limit marketing offers from our affiliates, 

you do not need to act again until you 

receive the renewal notice. 


emcdonald on DSK2BSOYB1PROD with RULES
43890 Federal Register / Vol. 76, No. 141 / Friday, July 22, 2011 / Rules and Regulations 

To limit marketing offers, contact us 

[include all that apply]: 

—By telephone: 1–877–###–#### 

—On the Web: www.-.com 

—By mail: check the box and complete the 

form below, and send the form to: 

—[Company name] 

—[Company address] 

llDo not allow your affiliates to use my 

personal information to market to me. 

A–2 Model Form for Initial Opt-Out Notice 

(Joint Notice) 

[Your Choice to Limit Marketing]/[Marketing 

Opt Out] 

—The [ABC group of companies] is providing 

this notice. 

—[Optional: Federal law gives you the right 

to limit some but not all marketing from 

the [ABC] companies. Federal law also 

requires us to give you this notice to tell 

you about your choice to limit marketing 

from the [ABC] companies.] 

—You may limit the [ABC companies], such 

as the [ABC commodity advisor, futures 

clearing merchant, and swap dealer] 

affiliates, from marketing their financial 

products or services to you based on your 

personal information that they receive from 

other [ABC] companies. This information 

includes your [income], your [account 

history], and your [credit score]. 

—Your choice to limit marketing offers from 

the [ABC] companies will apply [until you 

tell us to change your choice]/[for x years 

from when you tell us your choice]/[for at 

least 5 years from when you tell us your 

choice]. [Include if the opt-out period 

expires.] Once that period expires, you will 

receive a renewal notice that will allow 

you to continue to limit marketing offers 

from the [ABC] companies for [another x 

years]/[at least another 5 years]. 

¥[Include, if applicable, in a subsequent 

notice, including an annual notice, for 

consumers who may have previously opted 

out.] If you have already made a choice to 

limit marketing offers from the [ABC] 

companies, you do not need to act again 

until you receive the renewal notice. 

To limit marketing offers, contact us 

[include all that apply]: 

By telephone: 1–877-###–#### 

On the Web: www.-.com 

By mail: check the box and complete the 

form below, and send the form to: 

[Company name] 

[Company address] 

ll Do not allow any company [in the ABC 

group of companies] to use my personal 

information to market to me. 

A–3 Model Form for Renewal Notice (SingleAffiliate Notice) 

[Renewing Your Choice To Limit Marketing]/ 

[Renewing Your Marketing Opt Out] 

¥[Name of Affiliate] is providing this notice. 

¥[Optional: Federal law gives you the right 

to limit some but not all marketing from 

our affiliates. Federal law also requires us 

to give you this notice to tell you about 

your choice to limit marketing from our 

affiliates.] 

¥You previously chose to limit our affiliates 

in the [ABC] group of companies, such as 

our [commodity advisor, futures clearing 

merchant, and swap dealer] affiliates, from 

marketing their financial products or 

services to you based on your personal 

information that we share with them. This 

information includes your [income], your 

[account history with us], and your [credit 

score]. 

¥Your choice has expired or is about to 

expire. 

To renew your choice to limit marketing for 

[x] more years, contact us [include all that 

apply]: 

By telephone: 1–877-###–#### 

On the Web: www.-.com 

By mail: check the box and complete the 

form below, and send the form to: 

[Company name] 

[Company address] 

llRenew my choice to limit marketing for 

[x] more years. 

A–4 Model Form for Renewal Notice (Joint 

Notice) 

[Renewing Your Choice To Limit Marketing]/ 

[Renewing Your Marketing Opt Out] 

¥The [ABC group of companies] is providing 

this notice. 

¥[Optional: Federal law gives you the right 

to limit some but not all marketing from 

the [ABC] companies. Federal law also 

requires us to give you this notice to tell 

you about your choice to limit marketing 

from the [ABC] companies.] 

¥You previously chose to limit the [ABC 

companies], such as the [ABC commodity 

advisor, futures clearing merchant, and 

swap dealer] affiliates, from marketing 

their financial products or services to you 

based on your personal information that 

they receive from other [ABC] companies. 

This information includes your [income], 

your [account history], and your [credit 

score]. 

¥Your choice has expired or is about to 

expire. 

To renew your choice to limit marketing for 

[x] more years, contact us [include all that 

apply]: 

By telephone: 1–877-###–#### 

On the Web: www.-.com 

By mail: check the box and complete the 

form below, and send the form to: 

[Company name] 

[Company address] 

ll Renew my choice to limit marketing for 

[x] more years. 

A–5 Model Form for Voluntary ‘‘No 

Marketing’’ Notice 

[Your Choice To Stop Marketing] 

¥[Name of Affiliate] is providing this notice. 

You may choose to stop all marketing from 

us and our affiliates. 

To stop all marketing offers, contact us 

[include all that apply]: 

By telephone: 1–877-###–#### 

On the Web: www.-.com 

By mail: check the box and complete the 

form below, and send the form to: 

[Company name] 

[Company address] 

ll Do not market to me. 

Issued in Washington, DC, on July 7, 2011 

by the Commission. 

David A. Stawick, 

Secretary of the Commission. 

Appendices to Business Affiliate 

Marketing and Disposal of Consumer 

Information Rules—Commission Voting 

Summary and Statements of 

Commissioners 

Note: The following appendices will not 

appear in the Code of Federal Regulations. 

Appendix 1—Commission Voting 

Summary 

On this matter, Chairman Gensler and 

Commissioners Dunn, Sommers, O’Malia and 

Chilton voted in the affirmative; no 

Commissioner voted in the negative. 

Appendix 2—Statement of Chairman 

Gary Gensler 

I support the final rulemaking to extend to 

customers of CFTC-regulated entities 

protections preventing certain business 

affiliated marketing and establishing other 

consumer information protections under the 

Fair Credit Reporting Act (FCRA). The 

rulemaking protects consumers by providing 

privacy protections to nonpublic consumer 

information held by entities that are subject 

to the jurisdiction of the Commission. The 

final rulemaking provides customers of 

CFTC-regulated entities with the same 

privacy protections now enjoyed by the 

customers of entities regulated by other 

Federal agencies. 

The rulemaking has two important 

features. First, it allows customers to prohibit 

Commission-regulated entities from using 

certain consumer information obtained from 

an affiliate to make solicitations to that 

customer for marketing purposes. This will 

be done by means of a customer opt out. 

Second, it requires Commission-regulated 

entities to develop and implement a written 

program and procedures for the proper 

disposal of consumer information. The 

rulemaking will help prevent the 

unauthorized use and disclosure of 

nonpublic, consumer information. 

[FR Doc. 2011–17711 Filed 7–21–11; 8:45 am] 

BILLING CODE 6351–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

17 CFR Part 240 

[Release No. 34–64913] 

Technical Amendment to Commission 

Procedures for Filing Applications for 

Orders for Exemptive Relief Under 

Section 36 of the Exchange Act 

AGENCY: Securities and Exchange 

Commission. 

ACTION: Final rule; technical 

amendment. 


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