For any customers who do not receive periodic statements or other notices from your institution at least annually, you must provide a full annual privacy notice once per year — you cannot rely on the alternative delivery method for those customers.

The alternative delivery method requirements include a requirement to provide a “notice of availability” on an account statement, coupon book, or another notice or disclosure that is required or specifically permitted by law. For those customers who do not receive any statements from your institution, it is impossible to provide the notice of availability on a periodic statement or coupon book.

The next question is whether those customers should receive (a) the full annual privacy notice or (b) the shorter notice of availability. Based on a conversation we had with a CFPB attorney, the answer is (a). As the CFPB attorney pointed out, the notice of availability was designed to be combined with another statement, since that increased the likelihood that a customer would see it. The notice of availability was not intended to be provided on its own.

As a result, we recommend sending full annual privacy notices to customers who do not receive periodic statements or other notices from your institution at least annually. In addition to loan and CD customers, this also may be the case for safe deposit box, IRA, and other customers.

For citations related to our guidance, please see:

• Regulation P, 12 CFR 1016.9(c)(2)(ii)(A) (for an institution that otherwise qualifies for the alternative delivery method, “you satisfy the requirement . . . to provide a notice if you: (A) Convey in a clear and conspicuous manner not less than annually on an account statement, coupon book, or a notice or disclosure you are required or expressly and specifically permitted to issue to the customer under any other provision of law that your privacy notice is available on your Web site and will be mailed to the customer upon request by telephone.”)