On Wednesday the Financial Services Oversight and Investigations Subcommittee held a hearing to find answers regarding the Consumer Financial Protection Bureau's (CFPB) collection of consumer data.
Subcommittee Chairman Sean Duffy (R-WI) warned, "We don’t know – and the American people don’t know – how much personally identifiable information the CFPB retains, how that data is protected and what the Bureau plans to do with all that data."
The American Banker reported on Rep. Michael Fitzpatrick's (R-PA) concerns regarding ongoing data breaches and the vulnerability of consumer data at the hands of the CFPB. "Increasingly our cyber infrastructure and private records are becoming the target of both state and non-state actors alike."
"For these reasons it is alarming that any organization… would collect any consumer data and store it in a single location like the Consumer Financial Protection Bureau does," continued Rep. Fitzpatrick.
The Hill quoted Rep. Mia Love's (R-UT) concern over lawmakers' casual treatment of data collection in its coverage of the hearing. "It is absolutely shocking to me the level of regulatory power these agencies have over the American people," she said.
Chairman Hensarling Continues Call for Transparency at the Fed
Chairman Jeb Hensarling (R-TX) responded to the Federal Reserve's interest rate hike with a continued call for more transparency at the Federal Reserve.
"The real question isn’t whether the Fed should be raising interest rates or lowering interest rates; it’s whether the Fed is giving our economy sustainable interest rates. Getting back to sustainable, market-based interest rates is better for consumers, investors and our economy overall. Unsustainably low interest rates clearly didn’t solve the problem or else Americans today wouldn’t be stuck in the slowest, worst-performing economic recovery of our lifetimes," remarked Chairman Hensarling.
The House of Representatives passed the Fed Oversight Reform and Modernization Act (FORM Act), sponsored by Rep. Bill Huizenga (R-MI) on November 19. The FORM Act would require the Federal Reserve to choose a monetary policy and communicate it to the American people. The FORM Act does not infringe on the Federal Reserve's independence to choose its monetary policy, but simply sheds light on its decision-making.
"The FORM Act will help expand economic opportunity because consumers, job creators and investors will all have more confidence in making financial plans. The more Americans can understand how the Fed will act, the better they can plan for the future," added Chairman Hensarling.
For more infomation on H.R. 3189, the FORM Act, click here.
Rep. Scott Tipton | Tipton questions agency’s handling of personal data
Rep. Scott Tipton, R-Cortez, a member of the committee, questioned the witnesses about the claim that the CFPB did not collect any personal identifying information that could be compromised by pointing out that the agency collects identifying markers from consumers such as gender, age and ethnicity.
Weekend Must Reads
Boston Globe | New regulations: headache for bankers, boon for bank lawyers
Talk to a community banker about the Dodd-Frank law and all the rules out of Washington as a result, and you’re bound to hear about the headaches. But the new rules have been a boon for these banks’ lawyers, the ones who are behind the scenes, assembling community bank mergers.
Wall Street Journal | The Fed’s Uncertain Leap Forward
Some uncertainty about future monetary policy is inevitable. The Fed has greatly added to that uncertainty by its decision to employ forward guidance rather than to follow a monetary rule. Unlike a rule, forward guidance reflects the thinking of policy makers today but does not bind them to action tomorrow. We have seen that play out through 2015. The chief effect of Wednesday’s action and accompanying statement is to once again increase uncertainty in financial markets.
Morning Consult | The U.S. Department of Labor’s Misguided ‘Fiduciary’ Rule
Both Democratic and Republican legislators have expressed concerns about proposed regulations from the Obama administration that will change the way Americans receive financial advice. The effect of these rules, if enacted as written, will be negative for savers in Northern Virginia as well as in the rest of the nation. They will disrupt an individual’s ability to access advice during the process of investment and retirement planning.
On the Horizon
Stay tuned!
In the News
American Banker | Republicans Hammer CFPB Over Data Collection Efforts
Washington Examiner | Gingrich goes after consumer data collection
The Hill | Gingrich slams consumer protection panel's data collection
Morning Consult | Newt Gingrich Brings Fireworks and Intrigue to CFPB Hearing
Wall Street Journal | Republicans Push Proposal to Let Banks Get Back Money From Fed
Politico Pro | Republicans gather support for Fed dividend change in omnibus
DSNews | Do the CFPB’s Massive Data Collection Efforts Pose a Threat to Americans?
New York Times | Fed Raises Key Interest Rate for First Time in Almost a Decade
HousingWire | Moody’s: TRID Violations Found in 90% of Recently Reviewed Mortgages