Definition
The Gramm-Leach-Bliley Act (GLBA) is a 1999 federal law that requires financial institutions, including car dealers that arrange financing or leases, to explain how they share customers’ personal financial information and to protect it. For dealers, the FTC’s Privacy Rule and Safeguards Rule put the law into practice.
Pasch Group Dealer Glossary · checked against primary sources October 2026
What it means for a dealership
Arranging credit makes a dealership a financial institution under GLBA, and that brings two sets of duties. The FTC’s Privacy Rule, 16 CFR Part 313, requires notices that explain the dealer’s privacy policies and practices, and lets customers opt out of most sharing of their information with unaffiliated companies. The Safeguards Rule, 16 CFR Part 314, requires a written information security program to protect that information.
The Safeguards Rule is where most recent compliance work has gone. Its amended requirements, including encryption, multi-factor authentication and a Qualified Individual who oversees the program, took effect on June 9, 2023. A requirement to notify the FTC of security events affecting 500 or more consumers took effect on May 13, 2024.
GLBA reaches well beyond the finance office. Credit applications, deal files, DMS records and the vendors that handle them can all hold covered customer information. State privacy laws may add their own requirements, so check with your counsel.
Questions
Does GLBA apply to every dealership?
It applies to dealers that collect customers’ financial information to arrange or extend credit or leases, which the FTC treats as financial institutions. A store that never arranges financing or leasing may fall outside it, but state privacy laws can still apply. Check with your counsel.
Sources
- Gramm-Leach-Bliley Act (FTC)
- 16 CFR Part 313: Privacy of Consumer Financial Information (LII)
- 16 CFR Part 314: Standards for Safeguarding Customer Information (eCFR)
This explains the rule in plain English. It isn’t legal advice: check how it applies to your dealership with your counsel.
Updated October 11, 2026