Money Matters: This Week in Washington
This Week in Washington for February 24, 2020
February 24, 2020
Dina Ellis
THE BIG PICTURE
On Wednesday, the most contentious debate of the Democratic primary thus far took place in Las Vegas, with six presidential contenders facing off just days before the Nevada caucuses. The evening was former New York City Mayor and billionaire Mike Bloomberg’s first appearance on stage since his late entry into the race, and he faced a barrage of criticism over his stop-and-frisk policy, use of non-disclosure agreements, and self-funded campaign, particularly from Sen. Elizabeth Warren. Personal tensions were also evident between Pete Buttigieg and Sen. Amy Klobuchar who sparred over the Senator’s knowledge of foreign policy. The evening was lauded as a success for Sen. Bernie Sanders who emerged relatively unscathed as he continues to gain traction in early primary states. In the aftermath, Bloomberg announced that he would release three women from the NDAs they had signed preventing them from publicly discussing sexual harassment or discrimination claims.
The President flexed his pardon power on Tuesday, announcing a number of clemencies including the commutation of former Illinois governor Rod Blagojevich’s sentence. Blagojevich had been convicted on charges related to his attempt to sell former President Barack Obama’s vacated Senate seat. The President also announced pardons for financier Michael Milken, best known for expanding the junk bond market in the 1980s, and other high-profile white-collar criminals.
Other highlights of last week include:
On Saturday, Sen. Bernie Sanders (I-VT) decisively won the Nevada caucuses, further cementing his status as the frontrunner for the Democratic nomination.
The President named current US Ambassador to Germany Richard Grenell to serve as the next acting Director of National Intelligence, succeeding Joseph Maguire.
The primary for the special election to replace former Rep. Sean Duffy in Wisconsin’s 7th District was held on Tuesday, and voters selected Republican state Sen. Tom Tiffany to face off against Democrat Tricia Zunker.
LAST WEEK ON THE HILL
No hearings held during the President’s Day recess.
LEGISLATION INTRODUCED AND PROPOSED
H.R. 5929: Rep. Bill Foster (D-IL) introduced H.R. 5929, which would amend the Securities Exchange Act of 1934 to require reporting of certain expenditures for political activities.
H.R. 5930: Rep. Cynthia Axne (D-IA) introduced H.R. 5930, which would amend the Securities Exchange Act of 1934 to require issuers to disclose information about human capital management in annual reports.
H.R. 5931: Rep. Clay Lacy (D-MO) introduced H.R. 5931, which would require a review of the effects of FHA mortgage insurance policies, practices, and products on small-dollar mortgage lending.
H.R. 5932: Rep. French Hill (R-AR) introduced H.R. 5932, which would ensure greater transparency about the terms and conditions of financing provided by China to member states of the international financial institutions.
H.R. 5933: Rep. Cynthia Axne (D-IA) introduced H.R. 5933, which would amend the Securities Act of 1934 to require country-by-country reporting.
H.R. 5934: Rep. Suzanne Bonamici (D-OR) introduced H.R. 5934, which would amend the Fair Debt Collection Practices Act to safeguard access to information for consumers and to stop abusive debt litigation.
S. 3300: Sen. Kirsten Gillibrand (D-NY) introduced S. 3300, the Data Protection Act of 2020, which would establish a Federal data protection agency.
THIS WEEK ON THE HILL
Tuesday, February 25
Senate Banking Committee Hearing on “Surface Transportation Reauthorization: Public Transportation Stakeholders’ Perspectives”: 10:00 AM in 538 Dirksen Senate Office Building.
THE REGULATORS
FDIC and OCC Announce 30-day Extension of Comment Period for Proposed Changes to Community Reinvestment Act Regulations: On Wednesday, the FDIC and OCC extended the public comment period by 30 days for proposed changes to the regulations implementing the Community Reinvestment Act (CRA) until April 8, 2020. The proposed regulations are intended to increase bank activity in low- and moderate-income communities where there is significant need for credit, more responsible lending, and greater access to banking services. The proposal from the OCC and FDIC was unable to gain support from the Federal Reserve, which declined to sign onto the proposal. Ranking Member of the Senate Banking Committee Sherrod Brown released a statement saying “we shouldn’t be rushing this process” because the CRA “is absolutely essential for the people who most need access to the banking system.”
FDIC Announces Members for the Advisory Committee of State Regulators: On Wednesday, the FDIC announced the selection of 15 members for its recently established Advisory Committee of State Regulators. The Committee, which was approved in November 2019, will serve as a mechanism for state regulators and the FDIC to discuss a variety of current and emerging issues that have potential implications for the regulation and supervision of state-chartered financial institutions. The Advisory Committee members included regulators of state-chartered financial institutions from across the United States as well as other individuals with expertise in the regulation of state-chartered financial institutions.
State Financial Regulators Launch Nationwide Technology Platform to Examine Fintechs and Other Nonbanks: On Wednesday, the Conference of State Bank Supervisors announced the nationwide rollout of the State Examination System (SES), the first nationwide platform to bring state regulators and companies into the same technology space for supervision, fostering greater transparency, and collaboration. Through SES, state regulators will be able to enhance supervisory oversight of nonbanks while making the process more efficient for regulators and companies alike.
CFPB to Host Symposium on February 26: On Thursday, the CFPB announced that it will hold a symposium on Consumer Access to Financial Records and Section 1033 of the Dodd-Frank Act on February 26. Section 1033 addresses consumers’ rights to access information about their financial accounts. The Bureau’s data access symposium is intended to elicit a variety of perspectives on the current and future state of the market for services based on consumer-authorized use of financial data.
CFTC Unanimously Approves Proposed Rules to Improve Data Quality, Streamline Regulations at February 20 Open Meeting: On Thursday, the CFTC unanimously approved two proposed rules to revise CFTC regulations for swap data reporting, dissemination, and public reporting requirements for market participants. The Commission also unanimously approved reopening the comment period of a proposed rule to amend certain agency regulations related to swap data repositories. All three measures are intended to improve data quality and streamline CFTC regulations.
Treasury Secretary Discusses Future of Fannie Mae and Freddie Mac: In a letter responding to questions submitted by Senate Democrats, Treasury Secretary Steven Mnuchin explained, “Treasury expects that it will be necessary to maintain limited and tailored government support” to ensure confidence in their ability to meet obligations, adding that “stability in the housing finance system is crucial, and there should be no disruption to the market as a result of Treasury’s recommended administrative reforms.”
IRS Set to Convene Crypto Summit in DC: The IRS has invited several crypto startups to a meeting in Washington, D.C. on March 3 to discuss how the agency can best “balance taxpayer service with regulatory enforcement.” The summit will include panels on technology updates, issues surrounding cryptocurrency exchanges, tax return preparation, and regulatory guidance and compliance. Panelists will have the opportunity to “share their views and engage with the audience, which will include IRS personnel from across the spectrum of tax administration, and individuals from other bureaus or offices within the Department of Treasury.”
OTHER NOTEWORTHY ITEMS
Democratic Hopeful Michael Bloomberg Unveils Plans for Wall Street Tax and Student Debt Relief: On Tuesday, former New York City Mayor and presidential contender Michael Bloomberg released a proposal to impose a 0.1% tax on financial transactions, arguing that “some of the world's leading financial centers, such as the United Kingdom and Hong Kong, have found that taxing financial transactions can raise significant revenue, both to defray the costs of overseeing markets and to address other social needs.” The plan would also create a 5% cap on student loan repayments from disposable income and cancel debt for those who attended failed for-profit colleges.
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