[Congressional Record Volume 161, Number 80 (Friday, May 22, 2015)]
[Senate]
[Pages S3304-S3305]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                      FOIA IMPROVEMENT ACT OF 2015

  Mr. BROWN. I recognize the principles of this legislation, which 
seeks to increase government transparency, but as the ranking member of 
the Senate Banking Committee, I also recognize the need for regulatory 
agencies to thoroughly fulfill their oversight and supervisory 
responsibilities over our Nation's financial institutions and the 
health and welfare of our financial system. The financial regulatory 
agencies are responsible for ensuring the safety and soundness of the 
financial system, compliance with Federal consumer financial law, and 
promoting fair, orderly, and efficient financial markets. Effective 
regulation requires that financial regulators have full access to 
information from regulated entities, and regulated entities should be 
confident that regulators will be able to protect an entity's 
confidential information from disclosure. Congress provided for this 
important exchange of information in the Freedom of Information Act, 
FOIA, by protecting supervisory information specifically in 5 U.S.C. 
Sec. 552(b)(8), commonly referred to as exemption 8, and more generally 
in other exemptions. Accordingly, I appreciate that S. 337 does not 
intend to limit the scope of the protections under exemption 8, or 
other exemptions relevant to financial regulators; nor does the bill 
intend to require release of confidential information about 
individuals, or information that a financial institution may have, the 
release of which could compromise the stability of the financial 
institution or the financial system, or undermine regulators' consumer 
protection efforts. Because the release of confidential or sensitive 
information relating to the supervision of regulated entities could 
cause harm to such entities, their customers, or the financial system, 
a financial regulatory agency could reasonably foresee that disclosure 
of such information requested under FOIA may harm an interest protected 
by exemption 8. This is precisely why Congress continues to provide 
these statutory exemptions.
  Mr. LEAHY. I thank Senator Brown for his interest and support for 
this legislation. I agree that the safety and soundness of our 
financial system and financial institutions depends on our financial 
regulators' ability to perform effective oversight and supervision of 
financial institutions. I also agree that the free flow of information 
between regulators and financial institutions is important to this 
process. Exemption 8 was intended by Congress, and has been interpreted 
by the courts, to be very broadly construed to ensure the security of 
financial institutions and to safeguard the relationship between 
financial institutions and their supervising agencies. The proposed 
amendments to FOIA are not intended to undermine the broad protection 
in exemption 8 or to undermine the integrity of the supervisory 
examination process. In addition, I note that some information that the 
government may withhold under exemption 8 is also protected under 
exemption 4, which exempts from disclosure commercial and financial 
information that is privileged or confidential. Exemption 4 covers 
information prohibited from disclosure under the Trade Secrets Act and 
similar laws, and as such does not provide for discretionary disclosure 
under FOIA. As with other exemptions that are based on separate legal 
restrictions, it is understood that the foreseeable harm standard will 
not apply to most of the information falling under exemption 4. I will 
continue to work with the banking committee and financial regulatory 
agencies to clarify the scope of the bill as we move forward in the 
legislative process and address any remaining concerns.
  Mr. CORNYN. I, too, thank Senator Brown for his remarks and for his 
interest and support for this legislation. I agree with Senator Leahy 
that the important goals of this bill are not intended to impede 
regulatory agencies' oversight and supervisory responsibilities, nor 
are they meant to hinder communication between financial regulators and 
the institutions that they regulate. I agree that it is important to 
ensure that our financial regulators are able to do the work required 
to maintain the safety and soundness of our financial system. I will 
also work with the chair and ranking member of the banking committee 
and the financial regulatory agencies to address any remaining concerns 
on this issue as we advance this very important piece of legislation.
  Mr. BROWN. I thank Senator Cornyn and Senator Leahy for their work on 
this important legislation and for working with me to clarify the scope 
of this bill. I hope Senator Cornyn and Senator Leahy continue to work 
on these issues with the financial regulatory agencies, including if 
the bill is considered in any conference with the House of 
Representatives, to ensure that this new standard will not undermine 
the broad protections currently afforded to confidential supervisory 
information and in turn undermine the

[[Page S3305]]

cooperative relationship between regulators and their supervised 
institutions.

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