U.S. House Committee on Financial Services Subcommittee holds hearing on consumer financial data privacy and possible GLBA modernization

The U.S. House Committee on Financial Services Subcommittee on Financial Institutions held a hearing on the evolving landscape of consumer data privacy laws across federal and state jurisdictions, with a focus on how consumer financial data privacy is addressed under the Gramm-Leach-Bliley Act (GLBA). Discussion centred on whether and how to modernise financial data privacy guardrails to reflect increased data sharing, more complex third-party relationships, and technology-driven delivery models, while balancing consumer protection against the risk of overly restrictive rules limiting access to financial services. Witnesses highlighted support for a comprehensive, uniform federal privacy framework, with proposals including recognising GLBA-based standards through an entity-level exemption for financial institutions, stronger federal pre-emption of divergent state laws for compliant firms, and limiting exposure to private rights of action; testimony also underscored that GLBA’s definition of “financial institution” can extend beyond banks to a broad set of non-bank providers handling consumer financial data.