Information Technology Acts
Financial Services Modernization Act Of 1999
Can what happened during the Great Depression ever happen again? They are not sure. As a country, they have taken steps to decrease the extent of damage something like this could ever do again. The technological systems used today for tracking, maintaining, and storing data are much more complex, complicated, of larger capacity, and in need of complex laws to protect the information.
To understand the full reasoning behind the need for this act we can look at what happened during the great depression. At that time, there were banks participating in brokerage and investment services without any oversight or regulation. When the Great Depression happened the impact it had on society, individuals, families, the economy, and the nation itself was of significant magnitude. Many people, companies, and businessmen lost everything they owned, their lives savings gone forever; banks closed and went bankrupt. Some men took their own lives over the monumental financial loss. In 1933 Congress passed the Glass-Steagall Act that prohibited commercial banks from taking these additional risks with security transactions. This helped protect people who kept their lives savings and earnings with the bank.
Decades later while struggling during economic turns, financial leaders believed that if businesses could collaborate it would give them profitable divisions during downturns’ and therefore escape major losses and closures. “The Financial Services Modernization Act of 1999, also known as the Gramm-Leach-Bililey Act (GLBA), removed some of the last restrictions of the Glass-Steagall Act of 1933.” Helping deregulate the financial industry allowed companies to combine their operations and devote their resources in each other’s businesses. By doing it this way they are competitive and it increases