(a) Coverage. Subpart C of this part
applies to member banks of the Federal
Reserve System (other than national
banks) and their respective operating
subsidiaries that are not functionally
regulated within the meaning of section
5(c)(5) of the Bank Holding Company
Act, as amended (12 U.S.C. 1844(c)(5)),
branches and Agencies of foreign banks
(other than Federal branches, Federal
Agencies, and insured State branches of
foreign banks), commercial lending
companies owned or controlled by
foreign banks, and organizations
operating under section 25 or 25A of the
Federal Reserve Act (12 U.S.C. 601 et
seq., and 611 et seq.).
(b) Definitions. For purposes of this
subpart:
(1) Clear and conspicuous. The term
‘‘clear and conspicuous’’ means
reasonably understandable and
designed to call attention to the nature
and significance of the information
presented.
(2) Concise. (i) In general. The term
‘‘concise’’ means a reasonably brief
expression or statement.
(ii) Combination with other required
disclosures. A notice required by this
subpart may be concise even if it is
combined with other disclosures
required or authorized by federal or
state law.
(3) Eligibility information. The term
‘‘eligibility information’’ means any
information the communication of
which would be a consumer report if
the exclusions from the definition of
‘‘consumer report’’ in section
603(d)(2)(A) of the Act did not apply.
Eligibility information does not include
aggregate or blind data that does not
contain personal identifiers such as
account numbers, names, or addresses.
(4) Pre-existing business relationship.
(i) In general. The term ‘‘pre-existing
business relationship’’ means a
relationship between a person, or a
person’s licensed agent, and a consumer
based on—
(A) A financial contract between the
person and the consumer which is in
force on the date on which the
consumer is sent a solicitation covered
by this subpart;
(B) The purchase, rental, or lease by
the consumer of the person’s goods or
services, or a financial transaction
(including holding an active account or
a policy in force or having another
continuing relationship) between the
consumer and the person, during the 18-
month period immediately preceding
the date on which the consumer is sent
a solicitation covered by this subpart; or
(C) An inquiry or application by the
consumer regarding a product or service
offered by that person during the threemonth
period immediately preceding
the date on which the consumer is sent
a solicitation covered by this subpart.
(ii) Examples of pre-existing business
relationships. (A) If a consumer has a
time deposit account, such as a
certificate of deposit, at a depository
institution that is currently in force, the
depository institution has a pre-existing
business relationship with the consumer
and can use eligibility information it
receives from its affiliates to make
solicitations to the consumer about its
products or services.
(B) If a consumer obtained a
certificate of deposit from a depository
institution, but did not renew the
certificate at maturity, the depository
institution has a pre-existing business
relationship with the consumer and can
use eligibility information it receives
from its affiliates to make solicitations
to the consumer about its products or
services for 18 months after the date of
maturity of the certificate of deposit.
(C) If a consumer obtains a mortgage,
the mortgage lender has a pre-existing
business relationship with the
consumer. If the mortgage lender sells
the consumer’s entire loan to an
investor, the mortgage lender has a preexisting
business relationship with the
consumer and can use eligibility
information it receives from its affiliates
to make solicitations to the consumer
about its products or services for 18
months after the date it sells the loan,
and the investor has a pre-existing
business relationship with the consumer
upon purchasing the loan. If, however,
the mortgage lender sells a fractional
interest in the consumer’s loan to an
investor but also retains an ownership
interest in the loan, the mortgage lender
continues to have a pre-existing
business relationship with the
consumer, but the investor does not
have a pre-existing business
relationship with the consumer. If the
mortgage lender retains ownership of
the loan, but sells ownership of the
servicing rights to the consumer’s loan,
the mortgage lender continues to have a
pre-existing business relationship with
the consumer. The purchaser of the
servicing rights also has a pre-existing
business relationship with the consumer
as of the date it purchases ownership of
the servicing rights, but only if it
collects payments from or otherwise
deals directly with the consumer on a
continuing basis.
(D) If a consumer applies to a
depository institution for a product or
service that it offers, but does not obtain
a product or service from or enter into
a financial contract or transaction with
the institution, the depository
institution has a pre-existing business
relationship with the consumer and can
therefore use eligibility information it
receives from an affiliate to make
solicitations to the consumer about its
products or services for three months
after the date of the application.
(E) If a consumer makes a telephone
inquiry to a depository institution about
its products or services and provides
contact information to the institution,
but does not obtain a product or service
from or enter into a financial contract or
transaction with the institution, the
depository institution has a pre-existing
business relationship with the consumer
and can therefore use eligibility
information it receives from an affiliate
to make solicitations to the consumer
about its products or services for three
months after the date of the inquiry.
(F) If a consumer makes an inquiry to
a depository institution by e-mail about
its products or services, but does not
obtain a product or service from or enter
into a financial contract or transaction
with the institution, the depository
institution has a pre-existing business
relationship with the consumer and can
therefore use eligibility information it
receives from an affiliate to make
solicitations to the consumer about its
products or services for three months
after the date of the inquiry.
(G) If a consumer has an existing
relationship with a depository
institution that is part of a group of
affiliated companies, makes a telephone
call to the centralized call center for the
group of affiliated companies to inquire
about products or services offered by the
insurance affiliate, and provides contact
information to the call center, the call
constitutes an inquiry to the insurance
affiliate that offers those products or
services. The insurance affiliate has a
pre-existing business relationship with
the consumer and can therefore use
eligibility information it receives from
its affiliated depository institution to
make solicitations to the consumer
about its products or services for three
months after the date of the inquiry.
(iii) Examples where no pre-existing
business relationship is created. (A) If a
consumer makes a telephone call to a
centralized call center for a group of
affiliated companies to inquire about the
consumer’s existing account at a
depository institution, the call does not
constitute an inquiry to any affiliate
other than the depository institution
that holds the consumer’s account and
does not establish a pre-existing
business relationship between the
consumer and any affiliate of the
account-holding depository institution.
(B) If a consumer who has a deposit
account with a depository institution
makes a telephone call to an affiliate of
the institution to ask about the affiliate’s
retail locations and hours, but does not
make an inquiry about the affiliate’s
products or services, the call does not
constitute an inquiry and does not
establish a pre-existing business
relationship between the consumer and
the affiliate. Also, the affiliate’s capture
of the consumer’s telephone number
does not constitute an inquiry and does
not establish a pre-existing business
relationship between the consumer and
the affiliate.
(C) If a consumer makes a telephone
call to a depository institution in
response to an advertisement that offers
a free promotional item to consumers
who call a toll-free number, but the
advertisement does not indicate that the
depository institution’s products or
services will be marketed to consumers
who call in response, the call does not
create a pre-existing business
relationship between the consumer and
the depository institution because the
consumer has not made an inquiry
about a product or service offered by the
institution, but has merely responded to
an offer for a free promotional item.
(5) Solicitation. (i) In general. The
term ‘‘solicitation’’ means the marketing
of a product or service initiated by a
person to a particular consumer that
is—
(A) Based on eligibility information
communicated to that person by its
affiliate as described in this subpart; and
(B) Intended to encourage the
consumer to purchase or obtain such
product or service.
(ii) Exclusion of marketing directed at
the general public. A solicitation does
not include marketing communications
that are directed at the general public.
For example, television, general
circulation magazine, and billboard
advertisements do not constitute
solicitations, even if those
communications are intended to
encourage consumers to purchase
products and services from the person
initiating the communications.
(iii) Examples of solicitations. A
solicitation would include, for example,
a telemarketing call, direct mail, e-mail,
or other form of marketing
communication directed to a particular
consumer that is based on eligibility
information received from an affiliate.
(6) You means a person described in
paragraph (a) of this section.
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