Court Ruling Regarding Gramm-Leach-Bliley

This is somthing to think about...

In a legal decision that could have broad implications for financial institutions, a court has ruled recently that a student loan company was not negligent and did not have a duty under the Gramm-Leach-Bliley statute to encrypt a customer database on a laptop computer that fell into the wrong hands. Intrigued? Read on.

In a nut shell, an employee of Brazos Higher Education Service Corporation, Inc., had customer information on a laptop computer he was using at home. The computer was stolen, and a customer sued Brazos.

The judge dismissed the lawsuit. And then he noted...

Significantly, while recognizing that Gramm-Leach-Bliley does require financial institutions to protect against unauthorized access to customer records, Judge Kyle held that the statute "does not prohibit someone from working with sensitive data on a laptop computer in a home office," and does not require that "any nonpublic personal information stored on a laptop computer should be encrypted."