[Congressional Record Volume 164, Number 19 (Monday, January 29, 2018)]
[House]
[Pages H644-H645]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]





                              {time}  1745
   ESTABLISHING REQUIREMENTS FOR USE OF DRIVER'S LICENSE OR PERSONAL 
  IDENTIFICATION CARD FOR OPENING AN ACCOUNT OR OBTAINING A FINANCIAL 
                           PRODUCT OR SERVICE

  Mr. TIPTON. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 1457) to establish requirements for use of a driver's 
license or personal identification card by certain financial 
institutions for opening an account or obtaining a financial product or 
service, and for other purposes, as amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 1457

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. MAKING ONLINE BANKING INITIATION LEGAL AND EASY.

       (a) Definitions.--In this section:
       (1) Affiliate.--The term ``affiliate'' has the meaning 
     given the term in section 2 of the Bank Holding Company Act 
     of 1956 (12 U.S.C. 1841).
       (2) Driver's license.--The term ``driver's license'' means 
     a license issued by a State to an individual that authorizes 
     the individual to operate a motor vehicle on public streets, 
     roads, or highways.
       (3) Federal bank secrecy laws.--The term ``Federal bank 
     secrecy laws'' means--
       (A) section 21 of the Federal Deposit Insurance Act (12 
     U.S.C. 1829b);
       (B) section 123 of Public Law 91-508 (84 Stat. 1116); and
       ) subchapter II of chapter 53 of title 31, United States 
     Code.
       (4) Federally recognized indian tribe.--The term 
     ``federally recognized Indian Tribe'' has the meaning given 
     the term by the Secretary of the Interior under section 
     104(a) of the Federally Recognized Indian Tribe List Act of 
     1994 (25 U.S.C. 5131(a)).
       (5) Financial institution.--The term ``financial 
     institution'' means--
       (A) an insured depository institution;
       (B) an insured credit union; or
       (C) any affiliate of an insured depository institution or 
     insured credit union.
       (6) Financial product or service.--The term ``financial 
     product or service'' has the meaning given the term in 
     section 1002(15) of the Consumer Financial Protection Act of 
     2010 (12 U.S.C. 5481(15)).
       (7) Insured credit union.--The term ``insured credit 
     union'' has the meaning given the term in section 101 of the 
     Federal Credit Union Act (12 U.S.C. 1752).
       (8) Insured depository institution.--The term ``insured 
     depository institution'' has the meaning given the term in 
     section 3 of the Federal Deposit Insurance Act (12 U.S.C. 
     1813).
       (9) Online service.--The term ``online service'' means any 
     Internet-based service, such as a Web site or mobile 
     application.
       (10) Personal identification card.--The term ``personal 
     identification card'' means an identification document issued 
     by a State, local government, or federally recognized Indian 
     Tribe to an individual solely for the purpose of 
     identification of that individual.
       (11) Personal information.--The term ``personal 
     information'' means the information displayed on or 
     electronically encoded on a driver's license or personal 
     identification card that is reasonably necessary to fulfill 
     the purpose and uses permitted by subsection (b).
       (12) State.--The term ``State'' means any State, 
     commonwealth, territory, or possession of the United States, 
     the District of Columbia, the Commonwealth of Puerto Rico, 
     the Commonwealth of the Northern Mariana Islands, American 
     Samoa, Guam, or the United States Virgin Islands.
       (13) Scan.--The term ``scan'' means the act of using a 
     device or software to decipher, in an electronically readable 
     format, personal information displayed on or electronically 
     encoded on a driver's license or personal identification 
     card.
       (b) Use of a Driver's License or Personal Identification 
     Card.--
       (1) In general.--When an individual initiates a request 
     through an online service to open an account with a financial 
     institution or obtain a financial product or service from a 
     financial institution, the financial institution may record 
     personal information from a scan of the driver's license or 
     personal identification card of the individual, or make a 
     copy or receive an image of the driver's license or personal 
     identification card of the individual, and store or retain 
     such information in any electronic format for the purposes 
     described in paragraph (2).
       (2) Uses of information.--Except as required to comply with 
     Federal bank secrecy laws, a financial institution may only 
     use the information obtained under paragraph (1)--
       (A) to verify the authenticity of the driver's license or 
     personal identification card;
       (B) to verify the identity of the individual; and
       (C) to comply with a legal requirement to record, retain, 
     or transmit the personal information in connection with 
     opening an account or obtaining a financial product or 
     service.
       (3) Deletion of image.--A financial institution that makes 
     a copy or receives an image of a driver's license or personal 
     identification card of an individual in accordance with 
     paragraph (1) shall, after using the image for the purposes 
     described in paragraph (2), permanently delete, within a 
     reasonable amount of time--
       (A) any image of the driver's license or personal 
     identification card, as applicable; and
       (B) any copy of any such image.
       (c) Disclosure of Personal Information.--Nothing in this 
     section shall be construed to amend, modify, or otherwise 
     affect any State or Federal laws that govern a financial 
     institution's disclosure and security of personal information 
     that is not publicly available.
       (d) Relation to State Law.--The provisions of this section 
     shall preempt and supersede any State law that conflicts with 
     a provision of this section, but only to the extent of such 
     conflict.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Colorado (Mr. Tipton) and the gentlewoman from New York (Ms. Velazquez) 
each will control 20 minutes.
  The Chair recognizes the gentleman from Colorado.


                             General Leave

  Mr. TIPTON. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days in which to revise and extend their remarks and 
include extraneous material on the bill.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Colorado?
  There was no objection.
  Mr. TIPTON. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, as financial service products continue to merge with the 
ever-evolving world of technology, the opportunities to reach unbanked 
and underserved households also continue to increase. According to the 
Federal Deposit Insurance Corporation, 7 percent of the U.S. population 
is unbanked, and 19.9 percent is underbanked.
  The FDIC has concluded previously that mobile banking is well 
positioned to meet the day-to-day financial service needs of 
underbanked consumers as well as consumers at risk of account closure. 
Providing mobile financial services products to these households has 
shown to improve their financial outcomes by giving consumers more 
control over their finances, which helps households avoid burdensome 
fees and allows them to manage necessary payments more conveniently.
  Further FDIC research suggests that nearly three-quarters of all 
underbanked households have access to a smartphone and that more than 
one-third of underbanked households used mobile banking in the past 
year. In particular, the FDIC found that mobile financial services 
improved account stability by helping underserved consumers 
successfully manage and maintain bank accounts.
  Unfortunately, access to mobile financial service products is not 
equal across the United States. The Making Online Banking Initiation 
Legal and Easy Act remedies this lack of parity by establishing a 
uniform policy nationwide, allowing a financial institution to record 
personal information from a driver's license for the purpose of opening 
a bank account with a scan or copy.
  The MOBILE Act creates uniform access to helpful financial products 
and provides certainty to financial institutions to offer their full 
range of mobile banking products to all consumers nationwide.
  While the MOBILE Act creates a consistent law across the United 
States, it is careful to protect consumer privacy information and 
existing State privacy laws. The bill requires financial institutions 
to delete all copies of a driver's license and personal identification 
after having used them for the permitted purposes of opening an 
account.
  The legislation is also careful not to reduce any financial 
institution's commitment to comply with Federal and State laws aimed at 
preventing identity theft, financial fraud, money laundering, or know 
your customer and Customer Identification Programs.
  A Federal Reserve report from 2016 found that mobile banking use was 
rising at relatively fast rates, reporting that 43 percent of all 
mobile phone owners with a bank account had used mobile banking in the 
past 12 months, up from 39 percent in 2014 and 33 percent in 2013.
  Following this trend, the use of mobile banking will continue to 
grow, and the MOBILE Act ensures that every consumer across the country 
who wants to use a mobile banking product is able to do so. This bill 
was passed out of the Financial Services Committee on a unanimous, 
bipartisan vote.

[[Page H645]]

  The MOBILE Act provides consumers easier access to the highly 
regulated financial services industry by simplifying their ability to 
open an account through the process of scanning or copying their State-
issued identification card. As one State banking association wrote to 
me:

       This legislation is mutually beneficial to both financial 
     institutions and their customers. The MOBILE Act will help 
     expand access to critical banking services for underbanked 
     populations by offering similar retail services through 
     mobile technology.

  Increasing access for mobile financial services products also means 
giving rural communities, like many of the small towns I represent in 
Colorado, access to financial success. While many of us can drive a 
short distance, walk into a bank, and open an account, there are rural 
communities where physical bank locations are few and far between. By 
allowing those with smartphones to essentially have their bank accounts 
in their pocket, geography is no longer a constraint to accessing 
financial services products.
  All families should have the tools they need to be able to achieve 
the financial stability and the prosperity the MOBILE Act will provide.
  Mr. Speaker, this legislation is important for the future financial 
health of our Nation's customers. I urge its passage here today, and I 
reserve the balance of my time.
  Ms. VELAZQUEZ. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, H.R. 1457, the Making Online Banking Initiation Legal 
and Easy, or MOBILE, Act, permits financial institutions to copy or 
scan a consumer's driver's license or personal ID card when a consumer 
decides to obtain a financial product or service.
  At a time when more Americans are conducting their business online 
and through their phones, the MOBILE Act will help expand access to 
banking products and financial services for those consumers who do not 
have access to a traditional brick-and-mortar financial institution by 
allowing consumers to utilize their smartphones to open a checking or 
savings account.
  While financial inclusion has increased significantly over the past 
20 years, still, too many Americans do not get their basic financial 
needs met by traditional financial service providers. For example, in 
June 2016, the Obama administration released a report indicating that 
about 7 percent of American households still lack access to a bank 
account, and another 20 percent supplement their bank account with 
nontraditional financial services like check cashing or payday loans.

  Technological innovations in the financial industry and commonsense 
proposals like the MOBILE Act here in Congress will continue to help us 
close this gap. The bill will expand credit opportunities for consumers 
who cannot easily get to a bank in person and provides them access to 
innovative new products that can improve their overall financial 
health.
  An amendment in the nature of a substitute was adopted in committee 
that makes the MOBILE Act even stronger, and I want to thank Mr. Tipton 
for putting these improvements forward.
  These improvements require financial institutions to permanently 
delete copies of consumers' ID cards within a reasonable amount of time 
after they have opened the account, made clarifying changes to better 
harmonize the bill's requirements with Federal bank secrecy laws, and 
recognized identification cards issued by federally recognized Indian 
Tribes as an acceptable identification card.
  Perhaps most importantly, the bill also prohibits financial 
institutions from selling or otherwise sharing the personally 
identifiable information they collect from consumers with unaffiliated 
third parties.
  The bill is supported by several financial technology and industry 
groups, including the Innovative Lending Platform Association and the 
Financial Services Roundtable.
  Again, in a day and age when more and more Americans are conducting 
their business online and through their smartphones but still continue 
to lack access to traditional banking services and financial products, 
we need to be doing all we can to simplify the process and encourage 
account openings through these platforms.
  The MOBILE Act is a strong step in that direction, and I have been 
proud to join the bill as a cosponsor. I encourage Members to vote 
``yes.''
  Mr. Speaker, I yield back the balance of my time.
  Mr. TIPTON. I yield back the balance of my time, Mr. Speaker.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Colorado (Mr. Tipton) that the House suspend the rules 
and pass the bill, H.R. 1457, as amended.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds 
being in the affirmative, the ayes have it.
  Mr. TIPTON. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further 
proceedings on this motion will be postponed.

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