CREST Practitioner Security Analyst (CPSA) Practice

What is the primary purpose of the Gramm-Leach-Bliley Act?

1. Ensuring the security of financial transactions

2. Protecting customer information

3. Regulating banking mergers

4. Standardizing financial disclosures

The correct answer is: Protecting customer information

The primary purpose of the Gramm-Leach-Bliley Act (GLBA) is to protect customer information. Enacted in 1999, the GLBA established specific provisions that require financial institutions to provide privacy notices to their clients, informing them of how their personal information is collected, shared, and protected. This law aimed to enhance consumer privacy and data protection within the financial services sector, thus ensuring that institutions safeguard sensitive customer details. While other aspects mentioned in the choices, such as the security of financial transactions, regulating banking mergers, and standardizing financial disclosures, may be relevant to the broader context of financial regulation, they do not capture the fundamental objective of the GLBA as accurately as the focus on customer information protection. The emphasis on privacy and the obligation to maintain confidentiality underlines the act's significance in fostering trust between consumers and financial entities.