Press Releases



Washington, June 24, 2016 -

Committee Questions Yellen About Interest on Excess Reserves

On Wednesday, the Financial Services Committee held its semi-annual hearing on monetary policy and the economy with Federal Reserve Chair Janet Yellen.

In its coverage of the hearing, the Wall Street Journal reported that Republicans “pressed the Fed chairwoman to justify how much interest the Fed pays banks on the excess reserves they keep at the Fed” as well as “the slew of regulations implemented in the wake of the 2010 Dodd-Frank law.”

The Associated Press reported that “Republican lawmakers questioned whether [the Fed] was over-stepping its legal authority by paying interest on excess reserves…beyond what Congress envisioned.”

“You’re paying a premium to some of the largest banks in America,” Chairman Jeb Hensarling (R-TX) told Chair Yellen -- a policy that “favors a few at the expense of the many and weakens economic growth for working Americans.”

Representative Bill Huizenga (R-MI), Chairman of the Monetary Policy and Trade Subcommittee, read from Section 201 of the Financial Services Regulatory Relief Act of 2006, which states that interest on reserves can “not exceed the general level of short-term interest rates.”

“However, as we learned in last month’s Monetary Policy and Trade Subcommittee hearing, interest on reserves is above the Fed funds rate.  This above-market rate not only appears to have gone outside the bounds of the authorizing statute, it may also be discouraging a more free flow of credit in an economy that can and should be flourishing,” he said.

Terror Finance Task Force Holds Final Hearing, Prepares Bills

The Task Force to Investigate Terrorism Financing held its final hearing on Thursday, summarizing its efforts over the past two years to uncover the methods and mechanisms that terrorists use to fund their activities.

“The U.S. must be able to work freely with its international partners and seamlessly adapt to evolving money laundering and terror financing tactics. For this reason, the Task Force will be proposing a series of bills which aim to improve communication and coordination amongst various government agencies, allow for increased information sharing, and to ensure the Treasury is properly supported and recognized for its role in our nation’s national security strategy,” said Chairman Michael Fitzpatrick (R-PA).

Nobel Prize Winners, Former Treasury Secretaries Support Financial CHOICE Act

A group of Nobel Prize winning economists, former Treasury secretaries and former senior economic policy officials announced their support for the Financial CHOICE Act on Thursday.

“We support the reform principles that underlie the proposed Financial CHOICE Act which promote higher economic growth without bailouts, reduced risk of crises, and simplification of the regulatory process by emphasizing market mechanisms operating through the rule of law,” the group of renowned economic and financial experts said in a statement.

“The Act would encourage banks to rely on much more capital by offering them relief from complex, costly and loan-impeding regulations in return. The more banks are financed by capital, the less dangerous they are to the financial system and to the taxpayer, and so need less regulation.”

Hensarling Makes Case for Financial CHOICE Act at Heritage

Chairman Hensarling spoke Thursday at the Heritage Foundation’s event, “The Case Against Dodd-Frank: How the ‘Consumer Protection’ Law Endangers Americans.”

“Ladies and gentlemen, it’s time to make free enterprise legal again in America.  It’s time for a new paradigm in banking, capital markets and financial opportunity.  It’s time to offer all Americans opportunities to raise their standards of living and achieve financial independence,” he said.  “In a phrase, we need economic growth for all and bank bailouts for none.  This is the foundation of the alternative Republicans will offer the American people.”

A full video of his remarks is available here.

The Financial CHOICE Act has been described as “the broadest, most ambitious effort yet by the GOP to change how Wall Street and Washington interact” and “a constructive effort to spotlight Dodd-Frank’s flaws and show the way to improve it.”

For more information, visit /choice/.

Member Spotlights

Rep. Blaine Luetkemeyer (R-MO) | Dodd-Frank has failed. Here's why our plan is better

Nearly six years since its enactment, we should look around and ask ourselves if any of Dodd-Frank's promises have come to fruition. Is our economy more stable? Are taxpayers no longer on the hook for bailouts? And are Americans better off today than they were six years ago? The answer is a resolute no.

Rep. Scott Tipton (R-CO) | CFPB Payday Plan Thwarts Success of State Laws

This proposal, spanning an unbelievably convoluted 1,334 pages, was seemingly written to end what the bureau believes is an abusive product specifically designed to ensnare consumers in cycles of debt.  Unfortunately, the proposed rule is evidence the bureau repeatedly failed to perform the due diligence required to study how states like Colorado have worked in this area to create a balanced regulatory framework that both protects consumers from true predatory lending and maintains their ability to access short-term credit.

Weekend Must Reads

Investor’s Business Daily | Fixing What's Wrong With Dodd-Frank — And That's A Lot

The Republicans will soon put forth a plan to do away with the worst parts of the economy-smothering Dodd-Frank reforms. It's a welcome step toward restoring sanity to our financial markets.

MPA Magazine | ‘Why haven’t heads rolled?’ Damning report of continued woes at CFPB

The CFPB has come under fire before for what employees and former employees described as a pervasive culture of discrimination and retaliation. And the results of a GAO survey of CFPB employees “found heightened concerns related to fair treatment, trust that employees can raise concerns without fear of reprisal, confidence in complaint processes, and other matters,” the watchdog reported.

The Daily Caller |Report: Racial And Gender Discrimination Plagues Obama’s Model Consumer Agency

Racial and gender discrimination is widespread within the Consumer Financial Protection Bureau, the first new federal agency President Barack Obama created, according to a blistering report released Monday by the investigative arm of Congress.

Washington Free Beacon |Survey: Consumer Financial Protection Bureau Racist, Sexist

One in four of all black, Asian, and female employees surveyed at the Consumer Financial Protection Bureau reported that they had been victims of discrimination, according to a Government Accountability Office report.

In the News

Morning Consult | House Republicans Advocate for Dodd-Frank Replacement at Yellen Hearing

American Banker | Fed Open to Swapping Higher Capital for Simpler Regs: Yellen

Wall Street Journal |House Republicans Grill Janet Yellen on Fed Operations

Boston Globe | Yellen faces GOP criticism over weak economic growth

American Banker | Small Banks Become Collateral Damage in CFPB's Payday Plan

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