WASHINGTON, D.C. – U.S. Senator Heidi Heitkamp today introduced bipartisan legislation to reduce unnecessary burdens on community banks and local financial institutions by eliminating redundant, costly, and often ignored annual banking notifications, and instead require banks to alert customers only when privacy and information-sharing changes actually occur.

Current legal mandates require federal and local banks to update customers on an annual basis – often with thick letters laden with financial and legal jargon – whether important updates occur or not. This mandate results in consumers glazing over or discarding important changes when they do happen, and forces small financial institutions to spend time and money on burdensome and often duplicative notifications that they know their customers are not likely to read.

A vocal advocate for community banks, Heitkamp’s bipartisan legislation, introduced with Republican Senator Jerry Moran of Kansas, would do away with this process, instead requiring financial institutions to report to customers only when policies involving privacy and information actually change to make sure that the time and money of both consumers and institutions are carefully spent.

“In North Dakota, we understand the importance of being cost-conscious, and so do our local banks,” said Heitkamp. “But for years, local banks – which many North Dakotans use – have been forced to send out privacy notices each year that can be hundreds of pages long – putting an undue financial burden on them and providing redundant updates filled with legalese that often only confuse consumers. My bipartisan bill would make commonsense changes by making sure consumers are only informed when policies and practices are really changing. As a result, these changes would better support consumers and eliminate costly and redundant annual updates filled with legalese, but not a lot of news. I’ll keep fighting for commonsense solutions to see to it that our financial institutions aren’t wasting money and are instead investing in ways to responsibly inform hardworking Americans on how to best plan for their futures – and to make sure our federal priorities mirror our local values.”

Community banks remain a key resource for North Dakota families as there were 94 community banks operating in the state as of 2013. With more than 80 percent of North Dakotans’ deposits in community banks, Heitkamp remains committed to making sure regulations are effective, but do not overwhelmingly burden small financial institutions.

Heitkamp’s Privacy Notice Modernization Act is supported by a bipartisan group of 12 other Senators and is endorsed by: the American Bankers Association (ABA), the Independent Community Bankers of America (ICBA), the Credit Union National Association (CUNA), and the National Association of Federal Credit Unions (NAFCU).

Long a champion of local banks, Heitkamp has worked to make sure small banks aren’t encumbered by unnecessary regulations, and are given every opportunity to succeed and support North Dakota families.

Last March, Heitkamp led a bipartisan group of 16 Senators in urging President Obama to carefully consider the concerns of community banks when naming a nominee for the Federal Reserve Board of Governors, and calling on him to nominate someone to the Board who understands the lifelines community banks play in rural areas so those voices are heard. She continued her push to the White House throughout the year, and at a Senate Committee on Banking hearing in September, she spoke about the importance of making sure the Dodd-Frank wall street reform law doesn’t hurt small institutions like community banks. 

In August 2013, she brought Federal Deposit Insurance Corporation (FDIC) Chairman Martin Gruenberg to North Dakota to hear directly from bankers in the state about the importance of local and community banks to helping small businesses and communities thrive.

###