To include all banking agencies within the existing regulatory authority under the Federal Trade Commission Act with respect to depository institutions, and for other purposes.

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 3526) to include all banking agencies within the existing regulatory authority under the Federal Trade Commission Act with respect to depository institutions, and for other purposes, as amended.

Mr. Speaker, this is a bill that was broadly supported in our committee that we believe will enhance the ability of the Federal bank authorities to provide consumer protection. It's a little bit of a complicated story.

Congress passed an amendment to the Federal Trade Act that gave the Federal Reserve System the right to promulgate rules which defined what were unfair or deceptive practices engaged in by banks. The Federal Reserve has, for many years, declined to exercise that authority.

The issue was first brought to my attention when I was ranking member of the committee by a very distinguished public official who, sadly, died earlier this year, Ned Gramlich, who was the Federal Reserve Board Governor in charge of, among other things, consumer protection. And here's how it played out.

The Comptroller of the Currency and the Director of the Office of Thrift Supervision a few years ago promulgated very strict rules preempting State rules and State laws and regulations regarding the activities of national banks. As a result of that ruling, which was challenged but upheld by the courts, States have virtually no authority over the banking practices of national banks. Only the national bank regulators may regulate.

The problem is that there were, in many, many States, most of the States from which we here come, consumer protection laws which were invalidated by that. In fact, the preemption said even when there were rules of general application that were covering the banks, the ability of the States to enforce them was limited. They had to go through the Federal regulators. So we then went to the Federal regulators, but many of us were opposed to that. We were critical. And on a bipartisan basis there was criticism of it on the Financial Services Committee. Our former colleague, the gentlewoman from New York, Mrs. Kelly, who was chairman of the Oversight Committee, was a very strong critic of what she believed to be excessive overregulation. But that has been upheld, and there is no realistic chance of undoing it.

So the second best for us was to have the Federal bank regulators able to provide the consumer protections that were lost when the State rules were invalidated. I spoke with the Comptroller of the Currency, and his response was, Well, here's the problem. Under the Federal Trade Act, the Federal Reserve has the right to promulgate the code of unfair deceptive practices. He indicated to me that he would like to do that, in fact, two Comptrollers said we would like to do this, but we don't have the authority to promulgate the rules. The Office of Thrift Supervision, which preempted, interestingly, does have the authority to promulgate the rules.

Now, what motivated our colleagues of an earlier era to give the Federal Reserve the right to make the rules for the Comptroller of the Currency and to give the Office of Thrift Supervision the right to make the rules only for themselves? I do not know. I can't speculate. Based on most recent experience, it was probably the Senate's fault, because almost everything that goes wrong these days is. But I don't know that for sure. On the other hand, it's our job to try to correct it.

What this bill does is to say to two of the Federal bank agencies, the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation, which the Federal Deposit Insurance Corporation through its depository institutions has some authority over both national and State banks since it insures the deposits in both, we take away in this bill from the Federal Reserve System the power they have refused to use to promulgate a code of unfair and deceptive practices and give it, instead, over to the Comptroller of the Currency and the FDIC, either jointly or concurrently, and it comes with their support.

The Fed said they didn't like it, but they weren't using the power. The Comptroller of the Currency, he is, after all, a defender of this preemption. He has maintained the preemption. This is not an effort to undo the preemption. He acknowledges that in presiding over this national set of rules, it would be helpful to him to have this code of unfairness and deceptive practice, and what the code does is give some notice to the banks as to what are prohibited practices and what aren't. So this bill does nothing in terms of substantive promulgation of the code, but it gives to the active agencies, the Comptroller of the Currency, who promulgated the preemption, and the FDIC, the ability to put into effect what we think should have been put into effect before. It comes with the support of those agencies, and I think that if we get this done, they will proceed to do it.

I should note that the Office of Thrift Supervision, which already has the authority to promulgate such a code, is in the process of doing so. No legislation is needed. But they have put out a proposed rule in that regard. We have, many of us, encouraged them to go forward with it. And as a result of what OTS is doing under its authority and what this bill would give the Comptroller of the Currency and the FDIC by early next year, we should have in place rules that will tell people what are unfair and deceptive practices. And as I said, I would have preferred that the preemption would not have been so far reaching, but it's a fact of life. This will then empower the Federal bank regulators fully to be available to provide consumer protection when it's appropriate in lieu of the State laws that were cancelled.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, the good news is that I have no further requests for time, and I yield back the balance of my time.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I rise today in strong support of H.R. 3505, the Securities Law Technical Corrections Act of 2007, a measure to make technical corrections to the various securities laws, and I thank Mr. Scott for his support for this measure and also Chairman Frank and Ranking Member Bachus for advocating that this come to the floor today.

Mr. Speaker, in the aftermath of the stock market crash of 1929 and the ensuing Great Depression, Congress enacted the Federal securities laws of the 1930s and the 1940s. Over many years, Congress has amended these laws to adopt innovation and growth in the securities industry. Securities laws have become incredibly complex and technical due to the intricate and global markets we have today.

The goal of these laws is to protect investors, maintain fair, orderly and efficient markets, and to facilitate capital formation and promote competition. These laws range from governing over the initial issuance and registration of securities to the oversight of financial reporting and registration of people involved in the sale of securities. The laws also regulate the purchase and sale of securities, securities brokerage firms and securities exchanges, and they also have been responsible for the rules of the creation and operation of mutual funds and those laws governing the operation of investment advisors, all good things.

As Members of Congress, we have a responsibility to review laws that we pass to ensure that they are current and that they are up to date. Most importantly, Congress needs to clarify that these laws are well- crafted so that agencies who administer and enforce them are able to do so without causing unnecessary confusion to investors, to market participants and the courts.

Keeping the security laws current is a worthwhile undertaking. One such example where there is need to update our securities laws which are included in this legislation is to address the repeal of the Public Utility Holding Company Act of 1935. It was repealed, as Mr. Scott mentioned, in the 2005 energy bill because it was no longer necessary.

But it was originally adopted to deal with circumstances that existed in the 1930s and 1940s when the commission was restructuring the utility industry. At that point, a number of holding companies would have owned minority stakes in utilities and other holding companies and they may have held substantial equity assets that caused them to meet the investment company definition at that time.

Today, virtually all utility holding companies operate throughout wholly owned subsidiaries and, thus, do not have investment company status issues any different from any other type of holding company. So utility holding companies no longer need to be treated differently than any other type of company for purposes of determining whether they meet the definition of investment company.

H.R. 3505 makes almost 50 technical changes to the Federal securities laws. Mr. Speaker, I want to note that the Securities and Exchange Commission supports these changes.

Once again I want to thank my colleague Mr. Scott, along with Ranking Member Bachus and our chairman, Chairman Frank, for their support of this legislation, and I urge all of our colleagues to support it.

Mr. Speaker, I yield back the balance of my time.

Mr. Speaker, I rise in strong support of this legislation, and am proud to join my colleague, the gentleman from Massachusetts and Chairman of the Committee on Financial Services, Rep. Frank, in sponsoring this bill. It represents an important first step in improving the protection of consumers of depository institutions. H.R. 3526 was referred to both of our Committees (Energy and Commerce has Rule X jurisdiction over consumer protection and consumer affairs) and reported unanimously by both. I urge its adoption by the House.

The Supreme Court's ruling earlier this year in Watters v. Wachovia Bank N.A. upheld a regulation by the Department of Treasury's Office of the Comptroller of the Currency (OCC) that permits operating subsidiaries of national banks to violate State laws with impunity. The Court ruled that the bank's operating subsidiary is subject to OCC superintendence, even if there effectively is none, and not the licensing, reporting, and visitorial regimes of the States in which the subsidiary operates. The practical effect of the OCC's far-reaching preemption authority as interpreted and blessed by the courts is that it prevents States from using their historical authority to protect consumers and communities in large parts of the financial services marketplace, a huge consumer protection gap that evildoers have exploited and the Federal banking regulators have not shown an inclination or an ability to fill.

As explained more fully in our respective Committee reports, banks are covered by the Federal Trade Commission Act's prohibition against ``unfair or deceptive acts or practices in or affecting commerce,'' but the rule writer for them is not the Federal Trade Commission, the expert agency who implements and enforces this provision across the vast majority of the U.S. economy, but rather the Board of Governors of the Federal Reserve. It has done very little. Given the tide of complaints about abusive practices with respect to loans, credit cards, checking accounts, and other products, this is clearly unacceptable. H.R. 3526 therefore includes all Federal baking regulators, and not just the Federal Reserve, within the existing mandate under Section 18(f) of the FTC Act to adopt rules identifying and prohibiting unfair or deceptive acts or practices by depository institutions.

The Committee on Energy and Commerce was pleased to adopt improvements to this legislation. We amended it to require the banking regulators to consult with the FTC when promulgating any such rules, to allow the FTC to use the notice and comment procedures of the Administrative Procedure Act in concurrent rulemakings with the bank regulators, and to require GAO to report on the status of bank rules under these authorities.

I want to assure Members that the Committee on Energy and Commerce and its Subcommittee on Commerce, Trade, and Consumer Protection intend to engage in vigorous oversight, in consultation with the Committee on Financial Services, to make sure that this authority is aggressively used. The public will greatly benefit from it.

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 3505) to make various technical and clerical amendments to the Federal securities laws, as amended.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks and insert extraneous material on this legislation and on H.R. 3526, as amended.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, this bill, H.R. 3505, is the Securities Law Technical Corrections Act, and it consists entirely of technical and clerical amendments to the Federal securities laws which were requested by the Securities and Exchange Commission as a minor part of a larger legislative agenda. Included are the Security Act of 1934, the Investment Act of 1940 and the Trust Indenture Act of 1939.

Mr. Speaker, periodically we in Congress should review our laws in order to make sure that they are current and that they are up to date. Furthermore, this bill addresses certain changes to be made to reduce confusion. We want

to ensure that the laws we pass are current, and periodically clarifying certain aspects of these somewhat complex and complicated laws is a very valuable undertaking.

The amendments made by this bill correct drafting errors and remove obsolete references to the Public Utilities Holding Company Act of 1935, which was repealed in 2005. It further corrects numbering and punctuation errors. There are several technical changes that need to be made to the bill, as introduced, one to correct statutory citations and punctuation and also for clarification.

Mr. Speaker, as security laws are very complicated, very complex and highly technical, and with many of these laws having been written in the 1930s and the 1940s, periodic overview is very, very important and essential to the financial security of our great Nation, and this, Mr. Speaker, is the purpose of this bill.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I too want to thank my colleague Mr. Roskam for his hard work on this bill and for his contribution, and also the leadership of our Financial Services Committee under the chairmanship of Chairman Barney Frank for his work on this measure as well.

Mr. Speaker, I have no further requests for time, and I yield back the balance of my time.

Mr. Speaker, on that I demand the yeas and nays.

Mr. Speaker, I yield myself such time as I may consume.

I rise in support of the bill, H.R. 3526, a bill that is intended to provide financial consumers with additional regulatory protections against unfair and deceptive trade policies. This measure, which the Financial Services Committee approved by voice vote, expands the range of financial regulators, as the chairman has just explained, with the authority to promulgate regulations that identify and restrict such practices under the Federal Trade Commission Act.

Today only the Board of Governors of the Federal Reserve, the Office of Thrift Supervision, and the National Credit Union Administration have this authority. This bill expands that list to

include the other Federal banking regulators, namely the FDIC and the Office of the Comptroller of the Currency.

The legislation also mandates that regulations promulgated under the relevant section of the FTC Act be prescribed ``jointly by such agencies to the extent practicable,'' in consultation with the FTC. And it requires the GAO to report on the status of the regulations of the Federal banking agencies and the NCUA regarding unfair and deceptive acts.

In testimony before our committee earlier this year, the Comptroller of the Currency and the Chair of the FDIC recommended that the committee make these changes, which also are supported by consumer advocates. This bill merits our support, and I urge its adoption.

Mr. Speaker, I yield back the balance of my time.