[Congressional Record Volume 164, Number 50 (Thursday, March 22, 2018)]
[Senate]
[Page S1939]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




    ECONOMIC GROWTH, REGULATORY RELIEF, AND CONSUMER PROTECTION ACT

  Mr. VAN HOLLEN. Mr. President, I want to discuss S. 2155, the banking 
bill, and explain the provisions of the bill I supported, those I 
opposed, and my reasons for ultimately opposing this legislation.
  Over the past year, I have appreciated the opportunity to meet with 
Maryland community bankers, consumers, and an array of stakeholders who 
would be impacted by this bill. I have organized roundtables on 
economic development in Howard County and Baltimore. I have met with 
consumer groups who want a strong regulatory framework to ensure fair 
lending and to protect taxpayers from excessive risk-taking by some of 
the biggest banks. Most recently, I held a forum with my State's 
attorney general, Brian Frosh, where hundreds of passionate Marylanders 
came out on a rainy night to talk about consumer protection.
  We need a healthy banking system that serves Maryland businesses and 
consumers, and banking regulations should be appropriately tailored to 
the risks a bank poses to consumers, taxpayers, and the economy. 
Community banks should not have to comply with all of the regulations 
that apply to large Wall Street banks. That is why I support many of 
the reforms in this bill to relieve community banks of some unnecessary 
regulations. I also support provisions to modernize the Federal Deposit 
Insurance Act, so that reciprocal deposits are not considered to be 
brokered deposits.
  While I supported most of the reforms relating to community banks and 
credit unions, I have concerns with provisions in the bill that will 
encourage excessive risk-taking in systemically important banks and am 
disappointed by the absence of strengthened protections for consumers.
  For example, this legislation significantly raises the threshold for 
enhanced prudential standards for systemically important financial 
institutions, SIFIs. While I can support an increase in the threshold, 
I believe this bill goes too far. Gary Gensler, the chair of the 
Maryland Financial Consumer Protection Commission, and the former 
chairman of the Commodities Futures Trading Commission, has pointed out 
that this bill dials down prudential oversight for about 20 percent of 
U.S. banking sector assets. Mr. Gensler also noted that section 401 
could be construed as possibly requiring the Federal Reserve to raise 
the threshold at which foreign megabanks are subject to the enhanced 
standards, thereby potentially allowing the very biggest banks to 
escape some of the current regulations.
  I am also concerned that section 402 of the bill modifies the 
supplementary leverage ratio by excluding custodial assets for 
custodial banks. This provision allows for greater risk-taking among 
megabanks. Removing custodial assets from the denominator of the 
supplementary leverage ratio will allow these banks to take on risk in 
all areas. Former Federal Reserve Governor Daniel Tarullo said that 
removing one type of asset from a ratio on the grounds that it is safe 
``would defeat the whole purpose of a leverage ratio, which is to place 
a cap on total leverage, no matter what the assets on the other side of 
the balance sheet may be.'' Former FDIC Chair Sheila Bair wrote that 
``Section 402 will create an uneven playing field by giving big 
systemic banks a special capital break not applicable to community and 
regional institutions.'' Moreover, this could create a slippery slope 
where we start excluding other items banks deem ``safe'' from the 
ratio.
  Additionally, I cannot ignore the fact that this bill does very 
little to help strengthen consumer protections at a time when the Trump 
administration is eliminating rules that protect consumers. If we can 
reach bipartisan agreement to modify regulations for banks, surely we 
can find agreement on ways to help protect consumers from the abuses we 
have seen from the likes of Wells Fargo and Equifax.
  I am particularly troubled by two last-minute changes that benefit 
Equifax. Section 310 has the admirable goal of increasing competition 
in the credit scoring industry. However, the primary beneficiary of 
this provision is VantageScore, a company jointly created by the three 
consumer credit reporting agencies, Equifax, TransUnion, and Experian. 
This means that a company that is essentially owned by the credit 
bureaus will also have the ability to determine your score. In short, 
this bill gives the credit bureaus a key tool to take over the credit 
reporting and scoring markets. Be assured that I will closely watch how 
the Federal Housing Finance Agency implements section 310.
  After both Republicans and Democrats spent the past 6 months saying 
that we would hold the credit reporting agencies more accountable, this 
bill makes a second last-minute change that would prevent members of 
the armed services who receive a free credit freeze from suing the 
credit reporting bureaus for wrongdoing.
  We hear time and time again about how poorly the credit reporting 
bureaus treat consumers. False information in credit reports can do 
great harm to consumers; yet the credit rating agencies face no real 
sanctions for their culpability. That is unacceptable. We need to 
change the system so that these companies have better incentives to 
produce accurate credit reports, including sanctioning them for 
inaccurate and breached data. We must give consumers the power to 
control their own data and provide them with the ability to take legal 
action against the bureaus when they have been wronged. Providing the 
bureaus with a shield from legal liability and opening the door for 
them to manipulate the credit reporting industry is going in the wrong 
direction.
  In conclusion, while I support many provisions in the bill, 
especially those relating to community banks and credit unions, I 
believe other provisions in the bill create excessive risks. Those 
risks, as well as the failure to use this opportunity to further 
protect consumers, led me to oppose this bill.

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