The Communications, Financial Services and Interstate (CFI) Committee Newsletter is an NCSL electronic newsletter for Committee members and interested staff. This newsletter provides monthly updates and links to the latest research and news highlights related to communications, financial services and interstate commerce.
Introduced by Representative Blaine Luetkemeyer (R-Mo.), the "Consumer Information Notification Requirement Act," H.R. 6743, as amended, modifies the Gramm-Leach-Bailey Act to direct the federal financial regulatory agencies to establish a federal standard for financial institutions regarding data security measures, as well as a notification system that responds to any breach or unauthorized access of customer information.
H.R. 6743, passed the House Financial Services Committee by a vote 32-20 on Sept. 13. The legislation passed the committee despite opposition from the Conference of State Bank Supervisors (CSBS), the National Association of Insurance Commissioners (NAIC) and the National Governors Association.
NAIC and CSBS both wrote letters opposing the legislation.
As established under the Dodd-Frank Wall Street Reform and Consumer Protection Act, FSOC is charged with identifying risks to the financial stability of the United States; promoting market discipline; and responding to emerging risks to the stability of the U.S. financial system. The Council consists of 10 voting members and five nonvoting members and brings together the expertise of federal financial regulators, state regulators, and an independent insurance expert appointed by the president. State bank supervisors have appointed Texas Department of Banking Commissioner Charles G. Cooper to serve as the state banking representative on the Financial Stability Oversight Council (FSOC). His two-year term is effective immediately. North Carolina Bank Commissioner Ray Grace previously represented state banking supervisors on the FSOC.
State insurance regulators have appointed Eric A. Cioppa, superintendent of the Maine Bureau of Insurance, to a two-year term as the state insurance commissioner representative on FSOC. Cioppa, who also serves as president-elect of NAIC, will represent the interests of the nation's state insurance regulators on the council. Cioppa replaces Peter L. Hartt, director of New Jersey's Insurance Division, whose term expired Sept. 17.
On July 31, the Office of the Comptroller of the Currency (OCC) announced it will begin accepting applications for national bank charters from nondepository financial technology (fintech) companies engaged in the business of banking. The announcement to grant special-purpose charters for fintech companies is opposed by state bank regulators. At its Aug. 28 meeting, the CSBS Board of Directors approved moving forward with litigation against the OCC. The case will be filed at a time deemed appropriate. The New York Department of Financial Services Superintendent Maria Vullo filed a complaint in federal court on Sept. 18. The case is Vullo v Office of the Comptroller of the Currency et al, U.S. District Court, Southern District of New York, No. 18-08377. The OCC's fintech charters is supported by the Marketplace Lending Association.
On the heels of the European Union (EU) privacy rules and California's more recent data privacy law, the Internet Association (IA) outlines what they believe should be national data privacy regulatory framework. IA is a trade association that represents tech companies such as Amazon and Facebook. The association outlines a set of principles for "modernizing national privacy legislation and regulation" and additionally calls for Congress to pre-empt state level data privacy and breach notification laws, stating that there should be uniformity across the 50 states. The 50 states have already taken the lead on enacted breach notification laws. For example, in May, Colorado unanimously enacted the Protections for Consumer Data Privacy Act, establishing some of the most stringent data protection requirements in the U.S.
The U.S. Senate Committee on Commerce, Science and Transportation will hold a hearing on consumer data privacy set for Sept. 26, and includes representatives from AT&T, Amazon, Google, Twitter, Apple and Charter Communications. Simultaneously, the Department of Commerce through the National Institute of Standards and Technologies (NIST), will begin work on a voluntary data privacy guide as a resource for private companies to protect consumer and employee personal information.
The Federal Communications Commission (FCC) announced their agenda for the next open meeting on Sept. 26. The agenda includes a discussion on a Notice of Proposed Rulemaking (NPRM) on 911 calls made from multi-line telephone systems, best known as Kari's Law. This NPRM is in direct response to the Ray Baum's Act passed earlier this year. The FCC's report and order on accelerating wireless broadband deployment will also be on the docket for discussion. Included in the order is pre-emption language against state and local governments on certain aspects of small wireless facilities deployment, which state and local groups have opposed. The full docket is available.
During a speaking engagement at the Maine Heritage Policy Center, FCC Chairman Ajit Pai discussed the commission's recent rollback of the previous administration's net neutrality order and the work of some states to reinstate key aspects of those regulations on internet service providers. Specifically mentioning California's net neutrality bill, which passed out of the Legislature and is pending the governor's signature, Pai stated that states are pre-empted from reinstituting net neutrality like regulations and the FCC continues to oppose state actions to reinstitute Title II type regulations on internet service providers.
The FCC is requesting comments on promoting broadband internet access service for veterans, with emphasis on low-income veterans and rural resident veterans due by Oct. 12.