[Congressional Record Volume 164, Number 39 (Tuesday, March 6, 2018)]
[House]
[Pages H1382-H1389]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
COMPREHENSIVE REGULATORY REVIEW ACT
Mr. HENSARLING. Mr. Speaker, pursuant to House Resolution 747, I call
up the bill (H.R. 4607) to amend the Economic Growth and Regulatory
Paperwork Reduction Act of 1996 to ensure that Federal financial
regulators perform a comprehensive review of regulations to identify
outdated or otherwise unnecessary regulatory requirements imposed on
covered persons, and for other purposes, and ask for its immediate
consideration in the House.
The Clerk read the title of the bill.
The SPEAKER pro tempore (Mr. Arrington). Pursuant to House Resolution
747, an amendment in the nature of a substitute consisting of the text
of Rules Committee Print 115-61, modified by the amendment printed in
part B of House Report 115-582, is adopted, and the bill, as amended,
is considered read.
The text of the bill, as amended, is as follows:
H.R. 4607
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Comprehensive Regulatory
Review Act''.
SEC. 2. AMENDMENTS TO DEFINITIONS OF THE ECONOMIC GROWTH AND
REGULATORY PAPERWORK REDUCTION ACT.
Section 2001(c) of the Economic Growth and Regulatory
Paperwork Reduction Act of 1996 (12 U.S.C. 252 note) is
amended by adding at the end the following new paragraphs:
[[Page H1383]]
``(8) Covered person.--The term `covered person' has the
meaning given such term in section 1002 of the Consumer
Financial Protection Act of 2010 (12 U.S.C. 5481).
``(9) Federal financial regulator.--The term `Federal
financial regulator' means the Office of the Comptroller of
the Currency, the Federal Deposit Insurance Corporation, the
Board of Governors of the Federal Reserve System, the Bureau
of Consumer Financial Protection, and the National Credit
Union Administration Board.''.
SEC. 3. ENSURING A COMPREHENSIVE REGULATORY REVIEW.
(a) In General.--Subsection (a) of section 2222 of the
Economic Growth and Regulatory Paperwork Reduction Act of
1996 (12 U.S.C. 3311(a)) is amended--
(1) by striking ``10 years'' and inserting ``7 years'';
(2) by striking ``each appropriate'' and all that follows
through ``review'' and inserting ``the Federal financial
regulators shall each conduct a comprehensive review'';
(3) by striking ``such appropriate Federal banking agency''
and inserting ``such Federal financial regulator, jointly or
otherwise,''; and
(4) by inserting ``or covered persons'' after ``insured
depository institutions''.
(b) Conforming Amendments.--Such section is amended--
(1) in subsections (b), (c), (d), and (e), by striking
``the appropriate Federal banking agency'' each place that
term appears and inserting ``the appropriate Federal
financial regulator''; and
(2) in subsection (e)(1), by striking ``the appropriate
Federal banking agencies'' and inserting ``the appropriate
Federal financial regulator''.
SEC. 4. CONSIDERATIONS FOR COMPREHENSIVE REGULATORY REVIEW.
Section 2222 of the Economic Growth and Regulatory
Paperwork Reduction Act of 1996 (12 U.S.C. 3311), as amended
by section 3, is further amended--
(1) in subsection (c), by striking ``10 years'' and
inserting ``7 years''; and
(2) in subsection (d)--
(A) in paragraph (1), by striking ``and'' at the end;
(B) in paragraph (2), by striking the period at the end and
inserting ``; and''; and
(C) by adding at the end the following new paragraph:
``(3) tailor other regulations related to covered persons
in a manner that limits the regulatory compliance impact,
cost, liability risk, and other burdens, unless otherwise
determined by the Council or the appropriate Federal
financial regulator.''.
SEC. 5. REVIEWS CONDUCTED BY THE BUREAU.
Section 2222 of the Economic Growth and Regulatory
Paperwork Reduction Act of 1996 (12 U.S.C. 3311), as amended
by section 4, is further amended by adding at the end the
following new subsection:
``(f) Reviews Conducted by the Bureau.--The Bureau of
Consumer Financial Protection shall--
``(1) use any relevant information from an assessment
conducted under section 1022(d) of the Consumer Financial
Protection Act of 2010 (12 U.S.C. 5512(d)) in conducting the
review required under subsection (a); and
``(2) conduct such review in accordance with the purposes
and objectives described in subsections (a) and (b) of
section 1021 of such Act (12 U.S.C. 5511).''.
SEC. 6. REDUCTION OF SURPLUS FUNDS OF FEDERAL RESERVE BANKS.
(a) In General.--Section 7(a)(3)(A) of the Federal Reserve
Act (12 U.S.C. 289(a)(3)(A)) is amended by striking
``$7,500,000,000'' and inserting ``$7,495,714,285''.
(b) Effective Date.--Subsection (a) shall take effect on
May 1, 2018.
The SPEAKER pro tempore. The bill shall be debatable for 1 hour
equally divided and controlled by the chair and ranking minority member
of the Committee on Financial Services.
The gentleman from Texas (Mr. Hensarling) and the gentlewoman from
California (Ms. Maxine Waters) each will control 30 minutes.
The Chair recognizes the gentleman from Texas.
General Leave
Mr. HENSARLING. Mr. Speaker, I ask unanimous consent that all Members
may have 5 legislative days in which to revise and extend their remarks
and to submit extraneous material on the bill under consideration.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Texas?
There was no objection.
Mr. HENSARLING. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, before proceeding to the bill before us in the House,
not unlike yourself, I am a proud Texan--in my case, a fifth-generation
Texan.
In listening very carefully to the gentleman from Texas, Judge Poe, I
do wish to remind all my colleagues that it was this day in 1836 that
brave men in Texas took on the minions of tyranny at the Alamo. And
although they lost that battle, they inspired their nation at the time,
Texas, that would later become part of our Nation. So, on this day that
is special to all Texans, it should be special to all Americans.
We remember the cradle of liberty. Remember the Alamo. God bless
Texas.
{time} 1230
Mr. Speaker, otherwise, I rise also, today, in support of H.R. 4607,
which is a very important piece of legislation brought to us by a very
hardworking member of the Financial Services Committee, the gentleman
from Georgia (Mr. Loudermilk).
It is a bill that helps address the burden of unnecessary,
duplicative, and outdated regulations that too often have imposed cost
on our community financial institutions that ultimately make credit
more expensive and less available to our constituents. It passed out of
our committee with a very strong bipartisan vote of 38-17, and I
congratulate him for his bill.
Specifically, Mr. Speaker, this bill requires that all of the
prudential financial regulators that now include the CFPB and the NCUA,
the National Credit Union Administration--it ensures that all of our
financial regulators, not just some, but all, will participate in the
Economic Growth and Regulatory Paperwork Reduction Act, known as
EGRPRA, a law that dates back to the Clinton era, and this ensures that
our agencies review all rules that are prescribed by themselves that
impact our insured financial institutions.
The purpose of this review, again, is to reduce regulation that is
proven overly burdensome, duplicative, or outdated, while maintaining
our safety and soundness standards. And, again, Mr. Speaker, all this
is is a review. It ensures a review.
Additionally, H.R. 4607 will require that these agencies meet every 7
years for a comprehensive regulatory evaluation, as opposed to the
current 10-year standard. This is especially important. I salute the
gentleman from Georgia for his leadership, because we have seen our
financial sector of the economy suffer under the weight, the load, the
burden of regulation, particularly because six of the seven heaviest
regulatory years occurred under the last administration; so we need a
more thorough review of these regulations. And requiring our Federal
agencies to simply review their actions in a transparent manner on a
more frequent basis, it is simple; it is fair; it is straightforward;
it is wise.
Mr. Speaker, a healthy financial system that provides equal
opportunity to all Americans to achieve financial independence can only
exist if we have smart regulation. And the explosive growth of
regulation, following the enactment of Dodd-Frank, has made it
significantly harder for our community banks and credit unions to serve
their customers and members.
And, in fact, the complexity and cost of this regulatory burden has
forced many of them out of business or has forced them to cut back
services to their customers and members, and it is one of the reasons
why, on average, we continue to lose one community bank or credit union
a day, or every other day, in America. This should not be happening.
Ultimately, Mr. Speaker, it is not the banks and credit unions we are
so concerned about. It is their customers. It is customers like
Missouri mom, Michele, who explained to us how frustrating it has been
for her 20-year-old daughter, with a full-time job, to get a loan to
buy her first car. And, again, her daughter has a first-time job. And
as Michele explained to us: ``It's a catch-22. You need credit to get
credit, but no one will give you the credit to begin with. I would like
to see our young adults be able to build the credit they need so they
can have a decent future.''
Mr. Speaker, it is for people like Michele and her daughter that we
need this regulatory review. It is why we need the bill from the
gentleman from Georgia. These are the people we are trying to help.
Like Anne in Wisconsin, who was trying to get a loan to remodel her
attached garage when her son was born, and she said: ``My husband and I
have very high credit scores, and we have equity in our home, but
because my husband has a seasonal job and finds other employment in the
winter, the many banks we contacted rejected our loan request. They
base that on our annual income only on the job he was currently in and
said it was part of the new regulation.''
[[Page H1384]]
Well, of course it is, Mr. Speaker. That is why they need to be
reviewed. It is people like Anne in Wisconsin we need to help.
Or Dan, a Navy veteran from Illinois, who actually had to close
down--close down the small auto finance company he started with his
wife 25 years ago, and he had to close it down because of new Federal
regulation. He explains: ``Large companies can afford a separate legal
department to deal with these issues and the myriad of new regulations.
A small business like ours cannot. We had to make a decision. It was
just not worth the risk to continue operations in this antibusiness
environment.''
So, Mr. Speaker, it is people like Michele, it is people like Anne,
it is people like Dan who deserve the opportunity to have credit for
their homes, their autos, their small businesses, and so we must ensure
that all of our Federal regulators--all of our Federal financial
regulators take a thorough comprehensive review of their regulatory
burden so that we can continue to support the people who need credit.
H.R. 4607, again, has garnered strong bipartisan support. It is
practical; it is common sense; and I urge all of my colleagues to adopt
it.
Mr. Speaker, I reserve the balance of my time.
Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself such
time as I may consume.
Mr. Speaker, I rise in opposition to H.R. 4607, the so-called
Comprehensive Regulatory Review Act. So instead of advancing
legislation that improves our financial regulatory framework, the
Republican majority is pushing yet another bill that is a giveaway to
Wall Street and predatory lenders.
Let's be clear. This bill is intended to dismantle rules considered
inconvenient by the financial services industry. If this bill were
enacted, financial services regulators would be forced to spend more
time and resources on backward-looking reviews and deregulating the
financial services industry rather than strengthening protections for
consumers and the economy.
Allow me to explain. The Economic Growth and Regulatory Paperwork
Reduction Act, or EGRPRA, currently requires the Federal Reserve, the
FDIC, and the OCC to conduct a review of the regulations that they have
issued in order to identify outdated or otherwise unnecessary
regulatory requirements imposed on insured depository institutions.
The banking regulators conduct this review every 10 years, but until
now, this review has been a relatively balanced, careful assessment
that the banking regulators have done twice in the last two decades,
and the regulators have taken this process seriously.
The last review took about 3 years to complete. It involved field
hearings and public engagement. The final review included many balanced
and thoughtful recommendations to improve rules. Many of these would
provide relief for community banks and credit unions but in a way that
also maintains safeguards for consumers and protects the interests of
the public and the broader economy.
Unfortunately, H.R. 4607, this bill, would make three major mistakes
in changing the current review process. First, this bill actually
requires regulators to change regulations so that they are less costly
and burdensome for ``covered persons.''
Well, who are these covered persons? Are they the millions of
consumers who were harmed by Wells Fargo's scheme to open fraudulent
accounts without their knowledge? Were they? No.
Are they the many consumers who learned just a few days ago that
Citigroup violated the law by charging them too much interest on their
credit cards? No, no.
Are these covered persons in this bill the Latino or African-American
families who were discriminated against by JPMorgan Chase, Bank of
America, and so many other banks steering them into more costly
mortgages when they qualified for more affordable loans? No, not at
all.
Are they--the ones who are being protected--are they seniors or
servicemembers who fall prey to payday lenders that trap them in a
cycle of debt? No.
Are they college graduates who are harassed by debt collectors for
their student loan debt? No.
Under this bill, Mr. Speaker, covered persons are defined as ``any
person that engages in offering or providing a consumer financial
product or service; and any affiliate of''--such--``person . . . if
such affiliate acts as a service provider to such person.'' You know
what that means? You know who these so-called covered persons in this
bill are who they are talking about? That means Wells Fargo, JPMorgan
Chase, Citigroup, Bank of America, payday lenders, mortgage brokers,
debt collectors, and thousands of other financial companies.
All of these companies would get easier rules that limit their costs
and burdens without appropriately considering the impact they are going
to have on their customers. And this bill does nothing, absolutely
nothing, to strengthen protections for consumers where there might be
deficiencies or gaps in our regulatory framework.
Second, unlike the other banking regulators, which are tasked with
ensuring the safety and soundness of the financial services sector, the
Consumer Bureau's unique mission is the protection of consumers and of
ensuring that the consumer marketplace operates in a fair, transparent,
and competitive manner.
Although it may make sense for the banking agencies to periodically
review their prudential rules, with a focus on their regulated
entities, the Consumer Bureau should be making sure that its rules are
appropriately protecting consumers and the interests of the public, not
the big financial corporations.
In addition, the Consumer Bureau is already subject to unique
accountability and oversight measures that the other financial
regulators are not. These special checks and balances include the
requirement that the Consumer Bureau have small business review panels
as a part of its rulemaking process and the ability of the Financial
Stability Oversight Council, that is, FSOC, to repeal any of its final
rules. And the Consumer Bureau is already required to review all of the
significant rules within 5 years of the time they go into effect, but
in a balanced--balanced--manner.
The third problem with H.R. 4607 is that it would make it harder for
the regulators to do their jobs. The bill would require a comprehensive
review of all banking and consumer protection regulations once every 7
years instead of every decade. If regulators take these reviews as
seriously as their previous reviews, as I believe they would, then that
would mean they would be tied up spending nearly half of each 7-year
cycle doing regulatory reviews instead of supervising their regulated
entities and enforcing the law.
This bill would impose an unbalanced review process on regulators
that favors industries' wishes--favors industries' wishes over
consumers and the economy. The methodology in this bill promotes
deregulation. That is what this is all about. This is a bill about
deregulation instead of creating a robust process to identify gaps or
deficiencies in oversight that harm consumers, undermine the safety and
soundness of our financial system, or jeopardize the country's
financial stability.
So I cannot support a bill that forces the Consumer Bureau to weaken
rules for Wall Street and payday lenders. I am talking about the
Consumer Financial Protection Bureau. I urge my colleagues to oppose
H.R. 4607.
Mr. Speaker, I reserve the balance of my time.
{time} 1245
Mr. HENSARLING. Mr. Speaker, I yield 5 minutes to the gentleman from
Georgia (Mr. Loudermilk), a very hardworking member of the Financial
Services Committee and the author of H.R. 4607.
Mr. LOUDERMILK. Mr. Speaker, I want to thank my colleague from the
Republic of Texas, Chairman Hensarling, for giving me this time to move
away some of the hyperbole that you may hear today and speak about the
truth of what this really simple and commonsense measure really does.
Mr. Speaker, the Comprehensive Regulatory Review Act is a bill that I
introduced simply to reduce the burden that outdated and unnecessary
Federal regulations place on our small banks and lending institutions
across the landscape of America.
[[Page H1385]]
I would like to start by thanking some of my colleagues on both sides
of the aisle who have worked tirelessly to make this a strong,
bipartisan piece of legislation. I appreciate the gentleman from New
Jersey (Mr. Gottheimer) for negotiating reasonable changes to this bill
and for being an original cosponsor. I also appreciate Mr. Duffy and
Ms. Sinema and the others who have reached across the aisle to
cosponsor this important piece of legislation.
To fully understand this bill, Mr. Speaker, we have to go back to
1996, when Congress gave the financial regulatory agencies a useful
tool by passing the Economic Growth and Regulatory Paperwork Reduction
Act, or, as you have heard today, more commonly known as EGRPRA. This
law directed the Office of the Comptroller of the Currency, the Federal
Reserve, and the FDIC to review their regulations once every 10 years
to identify those regulations that may be outdated, unnecessary, or
overly burdensome. After that, the regulators were to send a report to
Congress and eliminate any regulations they determined were
unnecessary.
This law has been somewhat useful, and it was a good idea back in
1996 because, after all, who would be opposed to eliminating rules that
even regulators thought were unnecessary? But too often, EGRPRA has
been viewed as merely a check-the-box exercise by the agencies and the
financial sector.
Now that we have two EGRPRA reports, a 2007 and a 2017, it is obvious
that EGRPRA could have been more effective and produced more useful
recommendations to policymakers. In retrospect, we also realize we need
more direct action from the regulators to clean up outdated and
unnecessary rules. That is why it is important for Congress to revisit
EGRPRA, as this bill does.
My bill contains several reforms to the EGRPRA review process that
will breathe new life into this law, this tool for the regulators, and
make sure it is not simply a check-the-box exercise.
This bill will require more frequent regulatory reviews by moving the
review cycle from once a decade to once every 7 years. It will expand
EGRPRA to include all regulated financial institutions instead of only
depository-insured institutions. It will codify the National Credit
Union Administration into EGRPRA, since the agency participated in the
latest review voluntarily.
The bill will also add the controversial Consumer Finance Protection
Bureau, CFPB, to the EGRPRA review process. This provision is
especially important because, before Dodd-Frank, consumer financial
laws were implemented by the three banking agencies; but when Dodd-
Frank was enacted, the CFPB was given the responsibility for enforcing
consumer financial laws. Since the CFPB is exempt from EGRPRA, these
laws and regulations are no longer being comprehensively reviewed.
Dodd-Frank requires the CFPB to review its regulations every 5 years
after they are enacted, but this leaves out rules which are considered
nonsignificant. It also excludes rules that were adopted before the
CFPB was created. Also, the CFBP's regulatory reviews are under a
single, 5-year look-back period.
We must ensure that each regulatory agency is comprehensively
reviewing its rules, and on a regular basis.
This bill is not duplicative because it requires CFPB to use its
findings from its existing regulatory reviews in its EGRPRA reports so
the CFPB does not waste time on rules it has already reviewed. And,
most importantly, Mr. Speaker, this bill will require the agencies to
tailor rules that they find to be unnecessary based on the size and
risk profile of the bank or the credit union.
Mr. Speaker, I would like to repeat that last point because it is so
important. This bill does not require the agencies to cut regulations
with a broad brush, as it has been presented so far, nor does it cut
regulations on the payday lending industry, as some have argued. It
simply states the rules will be adjusted based on a company's risk if
the regulators determine that to be appropriate.
The bill ensures that if the financial regulators--the regulators--
determine that a regulation is important to consumer protection for
safety and soundness, the agency will still have every right to leave
that regulation completely intact.
This bill is not just about eliminating unnecessary regulations; it
is about good government and cleaning up unnecessary red tape that
inevitably hurts the consumer.
Mr. Speaker, the Treasury Secretary came to our committee for a
hearing last month, and I asked him about this very issue. He simply
said:
Rules and regulations need to be constantly looked at as
markets continually change.
He also said:
I'm not sure why the CFPB was exempted from EGRPRA, so I
agree with the change.
Mr. Speaker, this bill passed out of committee with a strong
bipartisan vote of more than two-thirds of the committee members, and I
urge my colleagues to join us in support of this bill.
Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself such
time as I may consume.
Mr. Speaker, I knew that my friends on the opposite side of the aisle
would basically refer to small banks.
This is what is normally done when we see deregulatory efforts being
made. They talk about how they are trying to help small and community
banks, and they fail to talk about the major financial institutions
that I have talked about in my presentation that are the beneficiaries,
also, of this deregulatory effort that is being put forth.
When I take a look at the existing law now and the Economic Growth
and Regulatory Paperwork Reduction Act, I see that their mission is to
conduct a review of their regulations to identify outdated or otherwise
unnecessary regulatory requirements imposed on insured depository
institutions.
This deregulatory bill that we have before us goes a lot further. As
I said, it is about deregulation, and it is about reducing cost and
liability risk. This does not benefit our consumers at all.
Again, what we would do in the passage of this bill is simply open up
opportunities for the big banks and financial institutions to get rid
of the kind of oversight, the kind of laws that we have worked so hard
for because it is inconvenient for them or it interferes with their
bottom line in some way.
So I do not want our Members to be tricked or fooled to think, number
one, this is simply about further getting rid of paperwork or that this
is about supporting the small banks. This is about new ways by which to
deregulate so that the big banks that are now found to be defrauding,
found to be discriminating, found to be doing things like Wells Fargo
has done, this is about deregulation that will further enhance their
ability to do the kinds of things that we claim to be so opposed to and
that harm our consumers.
The Consumer Financial Protection Bureau that they are now including
by way of H.R. 4607 should be looked at very carefully.
First of all, my friends on the opposite side of the aisle hate the
Consumer Financial Protection Bureau. They want to get rid of it. They
have tried, time and time again, to undermine it in so many ways. The
President has sent Mr. Mulvaney over there, who is supposed to be over
at the Office of Management and Budget, to basically destroy it.
Mr. Speaker, we cannot allow the Members of Congress to be tricked or
fooled that somehow this is helpful that they are bringing in the
Consumer Financial Protection Bureau. What they want to do is tie the
hands of the Consumer Financial Protection Bureau and basically change
their mission from protection for consumers to deregulation for the
biggest banks in America.
Why do we have the Consumer Financial Protection Bureau? That is the
centerpiece of the Dodd-Frank reform legislation that we worked so hard
on.
Are we forgetting about what happened in 2008?
Are with forgetting about the recession that was caused by the big
banks who had been involved with all of these exotic products and ways
by which they were enticing would-be homeowners to try and get
mortgages?
We can't forget about all of that. We have to know that not only did
we have a recession, we were headed for a depression. Dodd-Frank reform
has gone a long way toward eliminating some of the bad practices that
were in place that got us into that situation in the first place.
[[Page H1386]]
Now, little by little, my friends on the opposite side of the aisle
keep trying to creep in with new ways that they can support these big
banks and financial institutions and deregulate and let them get in the
position again where they are tricking our consumers, where they are
coming up with these exotic products that caused our consumers to
eventually get into foreclosure, and that would allow the big banks
again, like Wells Fargo, to come up with all of these tricks that they
use in order to enhance their bottom line. I think we are smarter than
this, and I don't think that we are going to go for this legislation
that is just another way to open the doors to deregulate.
Mr. Speaker, I reserve the balance of my time.
Mr. HENSARLING. Mr. Speaker, I yield 2 minutes to the gentleman from
Ohio (Mr. Chabot), who is the chairman of the Small Business Committee.
Mr. CHABOT. Mr. Speaker, I rise in support of H.R. 4607, the
Comprehensive Regulatory Review Act.
I want to thank Chairman Hensarling and the entire Financial Services
Committee for their continued critical work on financial regulations.
As chairman of the House Small Business Committee, I consistently
hear from Main Street businesses, small businesses from all over the
country, that overregulation is preventing business expansion and job
growth.
Just last week, I chaired a hearing on a recent report by the
nonpartisan Government Accountability Office that explored whether
financial regulations were adversely impacting community banks and
credit unions. One of the major takeaways from that report was that we
need to improve the tools available to financial regulators to reduce
those burdens.
Because small businesses most often rely on conventional bank
borrowing to finance their development, any additional red tape that
reduces access to capital can be a monumental problem for the Nation's
smallest firms. The bill that we have before us today, which would
reform the Economic Growth and Regulatory Paperwork Reduction Act of
1996, is a move in the right direction.
Making sure all financial regulators have a comprehensive process in
place to review regulations will strengthen our financial sector and
make it more possible for America's small businesses to have access to
the capital that they need to grow and expand and create more jobs for
more Americans. Mr. Speaker, I therefore urge my colleagues to support
the commonsense reforms that are in H.R. 4607, and I urge them to
support this legislation.
Ms. MAXINE WATERS of California. Mr. Speaker, I reserve the balance
of my time.
Mr. HENSARLING. Mr. Speaker, I yield 3 minutes to the gentleman from
Colorado (Mr. Tipton), who is vice chairman of the Financial Services
Subcommittee on Oversight and Investigations.
Mr. TIPTON. Mr. Speaker, I thank the chairman for this time to be
able to speak to an important piece of legislation.
In my home State of Colorado, we have a tale of two economies. The
urban areas have realized economic recovery since 2008, while the more
rural communities have been slower to find sustained economic growth.
Essential to these areas and their ability to be able to recover, a
topic that I speak frequently on, is access to credit.
As Treasury's report to the President in June of 2017 notes:
Regulations on capital, liquidity, and leverage requirements, as well
as regulatory parameters that guide loan underwriting, have undermined
the ability of financial institutions to deliver attractively priced
credit in sufficient quantity to meet the needs of the economy.
{time} 1300
In other words, our community financial institutions have lost access
to the tools that they need to be able to help their communities
recover as they have struggled to comply with regulations intended for
the largest institutions. Mr. Speaker, it is our local communities, our
small businesses, our first-time home buyers, and our working families
who suffer the consequences from these regulations.
Mr. Speaker, let me give you one example of what unbridled regulation
does and how it impacts families trying to be able to live that
American Dream.
I have an example of a credit union in my home State of Colorado that
had to stop offering home equity lines of credit to its members because
the cost of keeping the forms in compliance with Federal regulation
exceeded the income generated by the program. In other words,
regulation priced this credit union out of a critical market and at a
time when the rural environment the credit union serves needed access
to credit most.
Fortunately, Mr. Loudermilk's legislation being considered here today
will take important steps to require regulators to consider the
institution's size and risk profile as they evaluate the necessity and
effectiveness of regulatory rulemaking under the self-review mandated
to them by the Economic Growth and Regulatory Paperwork Reduction Act.
Importantly, Mr. Loudermilk's legislation will also expand the EGRPRA
process to the Consumer Financial Protection Bureau and the National
Credit Union Administration, encouraging the tailoring of regulations
across the regulatory spectrum.
This legislation takes steps to encourage regulators to allow small
institutions adequate leeway to exercise reasonably constructed
consumer lending regimes to make sure consumers have the broadest array
of choices and that institutions can appropriately navigate the
compliance landscape.
Mr. Speaker, by requiring regulators to more frequently review and
tailor regulations, this bill will help put Main Street back on the
path to prosperity and help to end the tale of two economies in
Colorado and throughout the Nation. Making these adjustments will help
community banks and credit unions once again be able to meet the needs
of their neighbors and encourage our businesses to be able to grow.
Mr. Speaker, I urge my colleagues to support this legislation.
Ms. MAXINE WATERS of California. Mr. Speaker, I reserve the balance
of my time.
Mr. HENSARLING. Mr. Speaker, I yield 3 minutes to the gentleman from
Minnesota (Mr. Emmer), who is yet another hardworking member of the
House Financial Services Committee.
Mr. EMMER. Mr. Speaker, the House Financial Services Committee has
been working hard for consumers, local banks, credit unions, and
American entrepreneurs during the 115th Congress. Today, we continue
our work with H.R. 4607, the Comprehensive Regulatory Review Act.
Introduced by my colleague from Georgia, Representative Barry
Loudermilk, this bill brings accountability and modernization to the
current regulatory review process for banks, credit unions, and
financial institutions across the country.
Currently, the regulatory audit conducted by our Federal financial
regulators happens just once every decade, and the Consumer Financial
Protection Bureau and the National Credit Union Administration are not
technically a part of that review.
It has been 21 years since we evaluated possible changes to this
antiquated and inefficient system. That is why we need Representative
Loudermilk's Comprehensive Regulatory Review Act to ensure the
regulations we have in place are working to do what they are supposed
to do: protect consumers.
This legislation is made even more urgent given that unchecked and
inefficient regulations are working against the very consumers our
regulatory regime was designed to help. Take, for example, the fact
that the United States lost nearly 12,000 of its federally insured
banks between 1984 and 2016, making it harder for small business
entrepreneurs and families to access the credit and capital they need
to create new opportunities and grow.
These banks struggled under the weight of new regulations, either to
disappear completely or to be swallowed up by the big banks that are
able to absorb the heavy cost of compliance. For those banks that are
able to survive, significant tradeoffs are required.
In Rockford, Minnesota, for instance, instead of adding another
lender to their team, one small community bank needed to hire a full-
time compliance officer simply to keep up with the regulatory onslaught
from Washington.
[[Page H1387]]
That same bank is spending over $100,000 each year on compliance costs
instead of using that money in ways that would benefit the local
community.
Minnesota's credit unions have also been hit hard by unchecked and
outdated regulation. One study found that credit unions in my State of
Minnesota have incurred $102 million in costs directly related to the
increased regulations created by the Dodd-Frank Act. Worse still, one
in every four Minnesota credit union employees spends their time solely
on regulatory compliance.
Mr. Speaker, we have a duty to stand up for these struggling
financial institutions and, more importantly, the consumers whose
communities are hurting without them. We can do that today.
Representative Loudermilk's legislation sailed through committee in
January receiving support from both sides of the aisle because
Republicans and Democrats know that H.R. 4607 takes necessary and
important steps to ease the regulatory burdens which challenge
community financial institutions in each and every congressional
district.
I appreciate the hard work of the bill's sponsor and the chairman of
the committee to bring this legislation to the floor today, and I urge
my colleagues to vote ``yes'' on the Comprehensive Regulatory Review
Act.
Ms. MAXINE WATERS of California. Mr. Speaker, I continue to reserve
the balance of my time.
Mr. HENSARLING. Mr. Speaker, I yield 1 minute to the gentleman from
New Jersey (Mr. Gottheimer), who is a Democratic member of the
Financial Services Committee.
Mr. GOTTHEIMER. Mr. Speaker, I first want to thank Congressman
Loudermilk for working together on the Comprehensive Regulatory Review
Act. Congressman Loudermilk has been a true partner who has been
tireless in pursuing smart regulatory reform policies and in finding
solutions for the people he serves. We both want to get something done
for the people we represent.
I also want to thank Congresswoman Sinema for her help and support in
leading this legislation.
I urge my colleagues on both sides of the aisle to support the
bipartisan Comprehensive Regulatory Review Act.
America's economic engine has been under pressure for some time now
from unnecessarily burdensome and outdated regulations building up on
the books of our regulators. It costs us in economic growth. And while
there are clear times where smart guardrails are necessary, there are
others when it actually holds back smart growth for our country and for
our families.
We need a smarter, more efficient government. It is time to relieve
these unnecessary burdens and spur business job growth and access to
credit in New Jersey's Fifth District and across the country while
protecting consumers and our economy. This bipartisan regulatory relief
bill does just that. It updates and expands regulators' mandatory
review of financial institutions while protecting consumers. It also
requires the review be performed every 7 years rather than every 10.
The SPEAKER pro tempore. The time of the gentleman has expired.
Mr. HENSARLING. Mr. Speaker, I yield the gentleman from New Jersey an
additional 30 seconds.
Mr. GOTTHEIMER: It requires regulators to consider tailoring
regulations when appropriate. In short, the Comprehensive Regulatory
Review Act will cut bureaucratic red tape and help our economy thrive
without putting consumers at risk.
There should be nothing partisan about helping entrepreneurs and
businesses of all sizes grow, create jobs, and expand the economy. With
this measure, Democrats and Republicans join together to ensure
outdated, unnecessary, and burdensome regulations are eliminated or
reformed to better fit the needs of individual financial institutions,
which ultimately saves Americans money, helps consumers and families
grow--and businesses, too--and it protects, always, American consumers.
Ms. MAXINE WATERS of California. I continue to reserve the balance of
my time, Mr. Speaker.
Mr. HENSARLING. Mr. Speaker, I yield 3 minutes to the gentleman from
North Carolina (Mr. Budd).
Mr. BUDD. Mr. Speaker, I thank my friend from Georgia for leading on
this issue.
I rise today in strong support of his bipartisan bill, the
Comprehensive Regulatory Review Act.
It strikes me as common sense that Federal regulators should review
their regulations and rules on a consistent basis. They should also
seek comment from the people whom these rules actually affect. Mr.
Loudermilk's bill helps accomplish this goal by requiring the CFPB and
National Credit Union Administration do so every 7 years.
Mr. Speaker, since the implementation of Dodd-Frank, community banks
and credit unions have had a more difficult time serving their
customers. The red tape and additional burden brought on by Dodd-Frank
has increased costs for the consumer and reduced their choices in the
market for financial products.
One agency in particular that is guilty for this additional burden is
the CFPB, which has finalized over 60 rules since their creation. Many
of their rules are duplicative and unnecessary. I think, at the very
least, they should review and study how their regulations are affecting
real folks in the real world.
I hear from financial institutions back home how the CFPB has done
nothing but harm their community bank or their credit union. They are
being overwhelmed by the volume and complexity of regulations, and that
is just not okay.
Harmonization is the goal of this bill, and that should not be
partisan or even controversial. We simply want less people buried in
paperwork and more people starting businesses through their local
financial institution.
This bill is supported by folks across the political spectrum, and I
am excited about the good it will do for our financial institutions
back home and consumers in my district.
I want to again thank Mr. Loudermilk for introducing this important
piece of legislation that will ensure our financial system is
functioning efficiently for hardworking Americans.
Ms. MAXINE WATERS of California. Mr. Speaker, I continue to reserve
the balance of my time.
Mr. HENSARLING. Mr. Speaker, I yield 3 minutes to the gentleman from
Missouri (Mr. Luetkemeyer), who is a real leader on our committee for
commonsense regulation and the chairman of our Financial Services
Subcommittee on Financial Institutions and Consumer Credit.
Mr. LUETKEMEYER. Mr. Speaker, I thank Chairman Hensarling for all his
great work and leadership on our Financial Services Committee and also
thank the gentleman from Georgia (Mr. Loudermilk) for crafting a
commonsense, bipartisan bill that requires the Federal financial
regulators and the Consumer Financial Protection Bureau to conduct a
comprehensive review of all the regulations promulgated with the intent
of identifying those that are outdated or duplicative.
Across the Nation, financial companies continue to suffer as a result
of the burdensome regulations. What my friends on the other side of the
aisle don't always recognize is the impact that has on the ability of
those companies to serve their customers.
Take cybersecurity as an example. Financial firms of all sizes are
forced to adhere to an overlapping regulatory regime that is focused on
fighting yesterday's war.
I spoke with a major bank just last week that has cybersecurity
examinations from the Federal Reserve, the Comptroller of the Currency,
the FDIC, the Treasury Department, and multiple State banking agencies;
and that doesn't include the foreign entities that regulate the
international businesses of this bank. Each agency has a slightly
different exam process and requires slightly different information.
This type of regime doesn't protect companies from cybersecurity
threats. The lack of coordination means this institution spends more
time reacting to the regulators than it does protecting its customers.
Or look at the antiquated regime surrounding examination and
enforcement of the Bank Secrecy Act and anti-money laundering laws.
What was originally intended to be a reasonable process that fostered
collaboration between financial institutions and law enforcement to
root out bad actors and
[[Page H1388]]
illicit financing has become so onerous that banks are choosing to drop
customers or close entire books of businesses just to avoid compliance
burdens. Processes like these do very little to help consumers or the
integrity of the financial system.
Every time I speak to a bank or credit union in Missouri, I ask what
one rule or regulation they find to be the most burdensome or they
would like to see changed. The answer is always the same: It isn't just
one. It is the weight of all the rules combined that is restricting
credit and the availability of financial services in our communities.
We have to make a change, Mr. Speaker. Mr. Loudermilk's legislation
would institute a more thoughtful approach to regulations that will not
only offer regulatory relief, but also foster a more responsible and
stable financial marketplace.
As the gentleman from Georgia has said in the past, this bill isn't
just about regulatory relief; it is about good government. This should
not be a partisan exercise. I hope every Member of this body stands for
responsible government and joins me in supporting H.R. 4607 today.
Mr. HENSARLING. Mr. Speaker, I have no further speakers, and I am
prepared to close.
Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself the
balance of my time.
Mr. Speaker, before I proceed with my closing, I would just like to
make a few comments about some of the information that was shared with
us by Members on the opposite side of the aisle. I want to remind them
that these poor little banks that you are talking about, which include
all of the big banks in America, made record profits in 2016--more than
$170 billion--and they are going to make billions more from that tax
bill, that tax scam giveaway to Wall Street. Lending is up 75 percent
since 2010.
So when my friends on the opposite side of the aisle continue to talk
about how the banks are suffering, I don't know who they are talking
about. As a matter of fact, the real bipartisanship of this committee
is about community banks, and Democrats have led and will continue to
lead on every way and everything that we can do for community banks.
{time} 1315
Mr. Speaker, I notice that when my friends on the opposite side of
the aisle come in with deregulation, they frame it in such a way that
you would think that it is all about community banks, when, in fact,
they always attach anything they do for community banks to the biggest
banks in America.
So, Mr. Speaker, H.R. 4607 demonstrates just how much my colleagues
on the other side of the aisle value the interests of Wall Street over
families and consumers on Main Street.
This bill would direct the banking, credit union, and consumer
protection regulators to loosen their rules to benefit bad actors on
Wall Street. The bill doesn't even allow regulators to consider how to
improve safeguards to better protect consumers.
It is absurd that we are here today discussing yet another bill that
leads to massive deregulation and seeks to tip the scales in favor of
the financial industry. The interests of the public are what we should
be focused on.
This bill is yet another piece of the harmful and reckless Republican
agenda. Only a few months ago, Republicans jammed their tax scam
legislation through this Chamber. They added $1.8 trillion to the
Federal debt in order to line the pockets of Wall Street and other
megacorporations with billions in tax cuts, leaving families on Main
Street and generations of their children just to pick up the tab.
Democrats rejected that terrible piece of legislation and should now
reject H.R. 4607 as well.
Americans for Financial Reform, a coalition of more than 200 consumer
civil rights, investor, retiree, community, labor, faith-based, and
business groups said that H.R. 4607, ``contains no consideration of the
public benefits that are the justification for creating the regulations
in the first place, and which regulators should be seeking to preserve.
Any mandate to tailor regulations must include consideration of public
benefits, rather than being a one-sided directive to reduce business
costs.'' I agree.
For Members who are concerned with maintaining strong protections, I
would highlight that Trump's OMB Director, Mick Mulvaney, has been
illegally installed as Acting Director of the Consumer Financial
Protection Bureau and is working every day to dial back the important
work of the Consumer Bureau from within.
Congress should not be giving Mr. Mulvaney, or anyone the President
eventually appoints and is confirmed to serve as the next Director of
the Consumer Bureau, a green light to gut consumer protections and
reduce the Consumer Bureau's ability to hold bad actors accountable.
Mr. Speaker, I urge my colleagues to oppose H.R. 4607, and I yield
back the balance of my time.
Mr. HENSARLING. Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, I listened very carefully to my friend on the other side
of the aisle. Again, her comments were very heavy on thematics, very
heavy on extraneous material. Unfortunately, it was a little light on
the facts of H.R. 4607.
The text of the bill is 3\1/2\ pages long; so it doesn't take very
long to read. But I remind all of my colleagues that this is common
sense. In and of itself, this bill changes no rules. All it does is
tell our regulators that every 7 years, why don't you look at what you
have done and publish a report.
If you want to change any rule, you have to go through the formal
rulemaking process to repropose a rule, to get public comment. So,
again, in and of itself, it changes no rules. I almost want to ask my
friend on the other side of the aisle: What is she scared of? What is
so wrong with simply looking at the rules that have been promulgated to
see if they are actually working? Are they helping our constituents?
Are they making economic opportunity more available for all?
What is so odd is, the original EGRPRA legislation that dates back to
the Clinton era was overwhelmingly supported on both sides of the
aisle.
So what the gentleman from Georgia is doing in H.R. 4607 is simply
saying all financial regulators, including the National Credit Union
Administration and the Consumer Financial Protection Bureau, which
really didn't even exist in the Clinton era, ought to do the same
thing. They are saying, instead of doing it every 10 years, let's do it
every 7 years. Just take a look and report. That is all it is.
It is a self-reporting requirement, which I think, Mr. Speaker, is
why this has already been supported overwhelmingly on a bipartisan
basis in the House Financial Services Committee.
So with all of the various scare tactics and horror stories that we
have heard from the other side of the aisle on a mere reporting
requirement, again, I ask, Mr. Speaker: What are they scared of?
What we are ultimately trying to do here is make sure that the
regulatory burden is not such that it harms the very people I spoke
about earlier in my opening comments: that it doesn't hurt Dan, a Navy
veteran from Illinois who, because of the regulatory burden, was forced
to shut down his small business; that it doesn't hurt Anne in
Wisconsin, who is just trying to get a loan to remodel her garage; that
it doesn't hurt Michele and her daughter in Missouri. Her daughter was
just simply seeking a car loan to buy her first car.
These are the people whom we are trying to help.
And by the way, all banks--small, medium, and large--are lending to
businesses and to consumers, and we want them to do that in a robust
but responsible way.
So, from time to time, let's look at the regulations and ensure that
they are still helping us achieve equal financial opportunity for all
so that our constituents can achieve their share of the American Dream,
that they can achieve financial independence.
This received strong, bipartisan support, Madam Speaker, in the House
Financial Services Committee. It ought to receive strong, bipartisan
support on the House floor.
Madam Speaker, I urge all Members to vote for and adopt H.R. 4607,
and I yield back the balance of my time
The SPEAKER pro tempore (Mrs. Roby). All time for debate has expired.
Pursuant to House Resolution 747, the previous question is ordered on
the bill, as amended.
[[Page H1389]]
The SPEAKER pro tempore. The question is on the engrossment and third
reading of the bill.
The bill was ordered to be engrossed and read a third time, and was
read the third time.
Motion to Recommit
Ms. CLARK of Massachusetts. Madam Speaker, I have a motion to
recommit at the desk.
The SPEAKER pro tempore. Is the gentlewoman opposed to the bill?
Ms. CLARK of Massachusetts. Madam Speaker, I am opposed.
The SPEAKER pro tempore. The Clerk will report the motion to
recommit.
The Clerk read as follows:
Ms. CLARK of Massachusetts moves to recommit the bill H.R.
4607 to the Committee on Financial Services with instructions
to report the same back to the House forthwith with the
following amendment:
Page 3, line 21, strike ``otherwise determined'' and insert
``such action is at the request of and for the personal gain
of the President, his or her immediate family members, or
senior Executive Branch officials who are required to file
annual financial disclosure forms, or is otherwise determined
inappropriate''.
Mr. LEUTKEMEYER. Madam Speaker, I reserve a point of order on the
motion to recommit.
The SPEAKER pro tempore. A point of order is reserved.
Pursuant to the rule, the gentlewoman from Massachusetts is
recognized for 5 minutes in support of her motion.
Ms. CLARK of Massachusetts. Madam Speaker, this is the final
amendment to the bill, which will not kill the bill or send it back to
committee. If adopted, the bill will immediately proceed to final
passage, as amended.
My amendment is a commonsense measure that protects the American
people from corruption and conflicts of interest.
My amendment simply states that before taking any action to eliminate
or change a regulation, regulators must disclose any communications
from the White House or the President's family advocating for the
action and whether the President, his family, or any senior
administration officials would benefit financially from such action.
The American people need to have confidence that their government is
working in the best interest of the people and not to enrich a
President and his family and wealthy friends.
Every day, the news is filled with stories that raise this very
question. Does the Trump family benefit when the EPA loosens
environmental safeguards on construction projects?
Does Jared Kushner's deeply indebted family business receive
favorable treatment when he advocates for certain policies?
Do the President's sons get special permits from foreign governments
when the President changes policies towards those countries?
Who in the administration gets richer when our coasts are opened up
to oil drilling, when tariffs are levied on steel, or when predatory
lenders are allowed to prey on college students?
President Trump has rejected the norm that all modern-day Presidents
have followed. His refusal to release his tax returns or to remove
himself from his family business necessitates codifying the norms and
practices of previous Presidents into law in this disclosure.
Congress must do its job and provide a necessary check on a President
who has shown contempt for his basic duty to put Americans first. All
of these policies affect American families. They affect the taxes we
pay, the air we breathe, and whether our kids can afford to go to
college.
We deserve to know if these decisions are being made to enrich a
President and if they are being made at the taxpayers' expense. This
simple act of disclosure will allow the American people to judge for
themselves who this administration is really looking out for.
Madam Speaker, I yield back the balance of my time.
Mr. LUETKEMEYER. Madam Speaker, I withdraw my reservation of a point
of order.
The SPEAKER pro tempore. The reservation of the point of order is
withdrawn.
Mr. LUETKEMEYER. Madam Speaker, I claim the time in opposition.
The SPEAKER pro tempore. The gentleman from Missouri is recognized
for 5 minutes.
Mr. LUETKEMEYER. Madam Speaker, I appreciate the opportunity to
discuss this matter today.
It is kind of interesting that we have before us an amendment that
basically is something that deals with a financial services bill,
something that deals with a financial services issue, yet we had the
EPA and a whole bunch of other agencies brought into the discussion
here, which has nothing to do with what we are trying to talk about
here today.
The amendment talks about the President or his immediate family
members. How is it possible that, unless those family members have the
authority to make the request, they even should be considered?
This is sort of pulling things out of the air here that make no sense
to me. This is a very simple bill that we have where all we are looking
at trying to do is take the EGRPRA law that says that, every 10 years,
all the rules and regulations are reviewed.
All we are doing is putting two agencies back into this group of
agencies that are under review, one that was not even in existence at
the time of the bill's passage back in the nineties, the CFPB; and the
other one that needs to be included is the National Credit Union. All
we are doing is taking that 10-year review down to 7.
Why is this controversial? We are taking an agency that was not even
included in this originally and putting it under the purview of this
bill so that there can be a review of the rules and regulations.
Is there lack of transparency on the other side?
Do we no longer want to be concerned about what is going on?
Do we no longer want to know that the rules and regulations are
appropriately adjudicated here by these agencies?
I think that is the wrong way to go. I think that we need to have
more transparency. Reducing from 10 years down to 7 gives us an
opportunity to have a more constant review of these things to make sure
that the bureaucratic folks in the executive branch of the government
don't run away with what should be, in my view, the authority of the
Congress.
{time} 1330
Madam Speaker, I think that the motion to recommit is way out of line
here, and I don't think we need to waste any more time on it.
Madam Speaker, I ask folks to decline the amendment, and I yield back
the balance of my time.
The SPEAKER pro tempore. Without objection, the previous question is
ordered on the motion to recommit.
There was no objection.
The SPEAKER pro tempore. The question is on the motion to recommit.
The question was taken; and the Speaker pro tempore announced that
the noes appeared to have it.
Ms. CLARK of Massachusetts. Madam 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 question will be postponed.
____________________