[Maddyfish]

We partner with an investment company to allow their employee to sell investment products in our branches. We are looking to bring the investment rep on board as a “dual employee”, whereby he works for us but continues to sell IPI products to our customers. He will use our wealth management logo (still trying to determine if this would be an affiliate) and get paid by the bank, but he uses their email address, they register him with FINRA, they oversee the investment compliance requirements and his training, etc.

This discussion to change the arrangement has raised the question as to whether we have to change our privacy policy. Currently, we do not share for any reason other than for everyday business purposes. If he works for the bank but sells the third party investment products, does that constitute sharing? Or would the investment company fall under the everyday business purpose exception? For anyone who currently uses this “dual employee” process, did you have to change your privacy policy as a result? And if so, what specifically did you change to “Yes”?

[jholzknecht]

Employing a dual employee provides access to your customer database to the other employer. Among other items, Section 1016.6 requires a privacy disclosure to include the categories of affiliates and nonaffiliated third parties to whom you disclose nonpublic personal information, other than those parties to whom you disclose information under §§1016.14 and 1016.15 of this part. Sharing under §1016.14 that is necessary to effect, administer, or enforce a transaction does not have to be disclosed. Sharing with the investment company to complete the transactions does not have to be listed in the disclosure, but opening your full database to them does impact the disclosure.

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