There are no legal restrictions on financial services companies' sending customer data to foreign countries for processing, the Federal Trade Commission said in a letter released Wednesday.
Under the Gramm-Leach-Bliley Act and the Fair Credit Reporting Act, "financial institutions do not have to disclose to consumers that they are sharing nonpublic personal information with service providers," FTC Chairman Timothy Muris wrote in a May 7 letter to Rep. Edward Markey, D-Mass. "Nevertheless, financial institutions are responsible for ensuring that certain service providers maintain the confidentiality of that information."
Rep. Markey said consumers should have more control over where their information is sent for processing, and he reiterated plans to introduce legislation "to close down these privacy loopholes."
He called for "new legislation clarifying the right of American consumers to prevent their most sensitive financial, tax, or medical information from being sent overseas to countries that may have little or no enforceable privacy protections."
Rep. Markey did not say what his bill would do to restrict data processing.
