Regulation S-P

Regulation S-P specifically deals with protecting the personal and private information of customers of financial firms. In the age of technology, certain measures must be taken to safeguard customer privacy.

Regulation S-P identifies what is considered private information. Items like social security numbers, suitability information, and account balances are obviously private. Data obtained through internet cookies is a little less obvious. Regardless, all of these items must be safeguarded properly.

In addition to identifying and protecting private information, Regulation S-P requires disclosure to customers when non-public information is provided to third parties. For example, your firm must tell you if it sends your non-public information to a third-party company to print checks. In order to print checks, the third party needs access to account numbers and private account information.

Firms must disclose this information at account opening and annually after. Additionally, the firm must provide the customer with an “opt-out” feature, which would prevent the firm from disclosing private information to third parties. Opt-out features must be easy to submit; check-off boxes on letters or e-mails are commonly utilized. More difficult measures, like requiring a customer to write a lengthy letter requesting the opt-out, are prohibited.