What must a licensee do before disclosing nonpublic personal financial information?

A licensee must provide a clear and conspicuous revised notice and a new opt-out notice before disclosing nonpublic personal financial information because this step ensures that consumers are fully informed about their privacy rights and the ways in which their information may be shared. The revised notice communicates any changes in how their information will be treated, while the opt-out notice gives consumers the opportunity to prevent or limit certain disclosures of their financial information.

This requirement is crucial for maintaining transparency and trust between the financial institution and the consumer, as it empowers individuals to make informed decisions about their personal data. By providing both notices, the licensee is fulfilling regulatory obligations designed to protect consumer privacy.

In contrast, the other approaches—such as providing an opt-out form only, sending an email notification, or notifying via telephone—do not sufficiently ensure that the consumer understands their options and the implications of sharing their financial information. A comprehensive and clear notice is necessary to facilitate meaningful consumer consent.