Financial Stability Oversight Council Improvement Act of 2017

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

Madam Speaker, I rise in strong opposition to H.R. 3978, the TRID Improvement Act of 2017.

H.R. 3978 has been dramatically expanded without input from Democrats to include several highly problematic and damaging bills. If enacted, this amended package of bills would ease the ability of high frequency traders to manipulate the stock markets undetected, encourage a regulatory race to the bottom in our Nation's stock exchanges, and harm investors and small businesses by weakening efforts to prevent accounting fraud at smaller public companies.

Taken together, this deregulatory package could significantly undermine market stability and gut investor and consumer protections at a time when our financial markets are already rattled.

Madam Speaker, from January 26 until last Thursday, the stock markets plunged just over 10 percent, becoming what the financial services industry calls ``stock market correction,'' and for the past two trading days, markets have rebounded the most since 2016.

Although market corrections are not new, what distinguishes today's volatility is that it is driven by complex computer strategies designed to buy and sell stocks and options millions of times a day. As many of us have witnessed, the Dow Jones Industrial Average may be up 500 points and then down 600 in less than a few minutes. For the average American who was hoping to one day retire with dignity by investing her hard-earned savings in the stock market, it can be distressing to see such wild swings always wondering whether the markets are truly fair or whether she is going to be fleeced. Unfortunately, the passage of H.R. 3978 would likely make those swings more extreme and increase the likelihood of problems going forward.

I am going to walk through each of the problematic provisions in this bill. Beginning with title IV, this provision is identical to H.R. 4546, the National Securities Exchange Regulatory Parity Act, which would weaken the standards for listing public companies for trading at U.S. stock exchanges. Today, exchanges listing standards set minimum requirements for a company's shares to be sold to the public without having to comply with State law. Exchanges can only revise these standards if the Securities and Exchange Commission first finds that new standards are substantially similar to the listing standards of the New York Stock Exchange.

This bill would remove any separate analysis for changing the standards and, thus, automatically preempt State oversight. As a result, the bill would encourage a race to the bottom of listing standards as exchanges compete with each other to attract companies with less restrictions, even if the standards are beneficial to the investors.

I believe that we should be strengthening the current analysis to promote fair and rigorous listing standards and only preempt State law when companies meet high standards. This is why I worked with the cosponsors last Congress to strike a bipartisan compromise which passed the House unanimously to require the SEC to develop a core qualitative listing standard. Unfortunately, my Republican colleagues have reversed their position in favor of empowering the industry over the investing public.

Turning to title III which is identical to H.R. 1645, the so-called Fostering Innovation Act, this provision would eliminate the independent audit of a company's financial reporting controls for up to 10 years for newly public companies provided that they have $50 million or less in gross revenues and less than $700 million in outstanding shares. Passed in the wake of the Enron and WorldCom accounting scandals, the requirement that public companies conduct an independent audit of financial controls is one of the many accounting provisions required by the bipartisan Sarbanes-Oxley Act that directly benefits investors and public companies by improving the accuracy of their financial reporting.

In fact, companies that are not subject to such review by an independent auditor are more likely to issue corrections to their financial reports leading to investor losses and higher losses for the company.

Investors like these audits because they improve the veracity of the reports they rely on to make investment decisions. Today, truly small public companies--those with less than $75 million worth of shares--are already exempt from the audit requirement. But this bill would extend the exemption to large companies that are nearly ten times that size. The law already provides newly public companies with an exemption for 5 years. Extending it to a decade would harm investor confidence and all such companies, hurting the very companies the bill's supporters purport to help.

Title II of this bill is the same language as H.R. 3948, the Protection of Source Code Act. This bill bans the SEC from inspecting source code used by regulated entities to engage in algorithmic or computer-driven trading and other activities that impact the securities markets and investors without first obtaining a subpoena. This provision would severely hamper the ability of the SEC to effectively examine persons like high-frequency traders and to investigate market disruptions.

The recent stock market volatility, which has seen all of the major stock indices decline by more than 10 percent in less than 2 weeks, has been exacerbated by high-frequency traders using complex computer algorithms to determine when to buy and sell millions of trades per second by making it harder for the capital markets COP to detect and stop bad actors and rein in fraudulent trading schemes. This provision will inevitably harm everyday Americans and retirees who rely on fair capital markets to invest their hard-earned savings.

To make matters worse, Republicans added a provision to pay for the cost of the bill by taking $2 million from the Securities and Exchange Commission's reserve fund. As a result, our financial watchdog will have less resources to support its capacity to oversee the markets through investments in IT and to respond to unforeseen market events like the flash crash.

In short, this bill asks taxpayers to pay for the costs of diminished capital market oversight by taking away SEC's funding to respond to emergency market situations that threaten market stability. This provision doubles down on the irresponsible policymaking we often see by the opposite side of the aisle.

The bill before us today would also make two less significant changes which I believe the Republicans included to garner additional support for the legislation. Nevertheless, even with these provisions, the package should be soundly rejected.

Title I, which includes the version of H.R. 3978, TRID Improvement Act of 2017, that the committee previously considered, would amend a mortgage disclosure known as TRID or the know-before-you-owe disclosure that informs home buyers of the terms and conditions of their mortgage. Responding to the concerns of some in the real estate industry, this provision would amend the disclosure to account for the discounts paid to borrowers in States where simultaneous lender and buyer title insurance is issued. However, the revised form does nothing for bars in States that do not provide such special rates to home buyers, and the provision eliminates the Consumer Bureau's ability to fix this aspect of the form even if a problem arises in the future.

The final provision, title V, is identical to H.R. 2948, the SAFE Mortgage Licensing Act. This title would ease the ability of individuals employed as mortgage originators to change employers by creating a temporary 120-day licensing regime so that they can continue to work at their new employer.

This bill would effectively treat mortgage originators who work for State registered firms the same as federally registered firms and was unanimously supported by committee Democrats. Unfortunately, because this legislation has been packaged with other deeply problematic and destructive bills, sensible relief to these individuals that has broad bipartisan support is being held hostage by Republicans' efforts to roll back as many safeguards as they can this year.

Madam Speaker, H.R. 3978, as amended, threatens many of the important reforms Democrats made to restore investor confidence to our capital markets after the worst financial crisis in generations. As the stock markets continue to wobble ominously in ways that threaten the savings of hardworking Americans, Congress should be strengthening oversight of the financial system, not weakening it.

Not surprisingly, H.R. 3978 is strongly opposed by the North American Association of Securities Administrators who serve on the frontline combating securities fraud on the State level and by nonpartisan organization who speak on behalf of our Nation's consumers, investors, and unions, including Consumer Federation of America, Center for American Progress, Americans for Financial Reform, AFL-CIO, and Public Citizen, and so do I.

Madam Speaker, I urge everyone to reject this harmful package of bills and to vote ``no'' on H.R. 3978.

Madam Speaker, I reserve the balance of my time.

Madam Speaker, I reserve the balance of my time.

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

Madam Speaker, given the extreme volatility in the stock markets over the past few weeks, I am particularly troubled by title II of this bill, which would make it easier for high-frequency traders to evade regulatory oversight of their potentially disruptive automated trading algorithms.

This provision is widely opposed by nonpartisan consumer and investor advocacy groups who recognize the impact automated trading has on our markets.

Let me read for you excerpts from a few letters from these groups that highlight the dangers of title 2.

Americans for Financial Reform--a coalition of more than 200 consumer, civil rights, investor, retiree community, labor, faith- based, and business groups--wrote: ``Title II would prevent regulators from inspecting not only their raw source code used in automated trading, but also any related intellectual property that `forms the basis for the design of' source code. Examination of such intellectual property would only be possible in an enforcement context pursuant to a subpoena. This implies that the SEC would have to wait until the damage was done through a `flash crash' or similar market disruption before taking any action, which would have to be retrospective.

``In light of the significance of automated trading to modern markets, and the potential risk of high-frequency trading, it makes no sense to tie the hands of regulators in examining detailed trading strategies and methods of high frequency traders.''

The Center for American Progress cautioned that: ``But in an era of fast-moving, `flash-crash'-prone markets, the SEC may have a wide range of regulatory reasons for why it may need to examine source codes, including approvals of new trading products or the supervision of trading venues. The SEC should only exercise that authority carefully and under the strictest protections for confidential information, but blocking it by law dangerously limits the SEC's ability to address the significant technology-based challenges to financial markets.''

The Consumer Federation of America, an association of nearly 300 consumer advocacy groups, similarly opposed title 2 because it ``would weaken SEC oversight of algorithmic trading and hamstring the agency from responding quickly to flash crashes or other market breakdowns.''

Further, the CFA wrote that: ``At a time when algorithmic trading is taking on increased importance in our capital markets, this bill would make it more difficult for the SEC to properly oversee such trading.

``The bill would require the SEC to first issue a subpoena before it could compel a person to produce or furnish to the SEC algorithmic trading source code or `similar intellectual property.' This would undermine the SEC's examination authority by creating a gaping hole in its ability to gain access to firm records relevant to the examination. It would also have a devastating effect on the agency's ability to respond quickly in the event of another `flash crash' or such events in the future. In order to oversee the markets effectively, the SEC needs to be able to accurately and efficiently reconstruct order entry and trading activity, including for algorithmic traders.''

Public Citizen, a consumer rights advocacy group with over 400,000 members and supporters, wrote: ``Market volatility caused not by real events such as outbreak of a war, but by computers, including computer glitches, threatens to erase savings to some innocent investors and erodes general investor confidence. The recent swings in the markets attest to the need for robust and urgent supervisory inspection. The May 6, 2010 `Flash Crash,' where markets collapsed by more than $1 trillion in less than an hour, revealed that such a robust and urgent supervision has been lacking. The SEC required nearly a half year to investigate this incident before identifying a flawed algorithmic at one major trader. SEC oversight should be streamlined, not hampered. Trading instructions and records of human traders are already subject to inspection, so it should be no different for those instructions and records generated by a machine. Hiding source code from regulatory scrutiny will leave those responsible for mistakes as well as those attempting to manipulate markets unaccountable.''

These letters demonstrate the wide opposition to title II by groups that truly understand that robust oversight of algorithmic trading is necessary for the help of our makers.

Madam Speaker, I include in the Record letters from these groups.

February 13, 2018.

Please vote NO on H.R. 3299 and H.R. 3978.

Hon. Member,

House of Representatives,

Washington, DC.

Dear Hon. Member: On behalf of more than 400,000 members

and supporters of Public Citizen, we ask you to vote NO on

H.R. 3299 and H.R. 3978, which are expected to be considered

by the full House on Wednesday, February 14, 2018. Provisions

in these bills would expose borrowers to abusive loans,

investors to dubious securities, and Americans generally to a

riskier financial system.

H.R. 3299, the Protecting Consumers' Access to Credit Act

of 2017, would allow predatory lenders to escape state limits

on high interest rates. The bill would nullify the Second

Circuit Court ruling in Madden v. Midland Funding. That

decision provided that a financial institution that buys

loans originated by a national bank could not benefit from

the National Bank Act's preemption of state interest rate

caps. While the Madden decision did not limit interest rates

that banks charge on credit, it does limit nonbanks from

evading state interest rate caps. This bill would pave the

way for payday lenders, financial technology (fintech)

companies and others to exploit that loophole and use a

``rent-a-bank'' arrangement in order to charge high interest

rates. Twenty state Attorneys General have written to oppose

this measure, noting that it undermines their efforts to

protect borrowers from abusive loan rates. We urge you to

oppose this bill.

H.R. 3978, the TRID Improvement Act of 2017, is actually a

package of bills that were considered separately in the House

Financial Services Committee. One of these is the Financial

Stability Oversight Council Improvement Act (formerly H.R.

4061). This measure would add numerous procedural

requirements for the Financial Stability Oversight Council

(FSOC) when it considers the designation or continued

designation of a nonbank firm as a systemically important

financial institution (SIFI). Current rules already make SIFI

designation a high hurdle. The case of MetLife, for example,

shows that firms enjoy more than ample methods to contest

designation. After FSOC designated MetLife as systemically

important, it contested it in court and the case is pending.

Increasing the government's burden for designation would

restrict its ability to apply enhanced supervision to major

institutions. However, the largest bailout of the 2008

financial crash went to AIG, a nonbank engaged in reckless

derivatives activity beyond the purview of banking

supervisors. We oppose this measure.

Another bill contained in H.R. 3978 is the Fostering

Innovation Act (previously H.R. 1645). This bill amends

Section 404(b) of the Sarbanes-Oxley (SOX) law by increasing

from five to 10 years the time that CEOs of firms with less

than $50 million in revenue must attest to the accuracy of

their financial reporting. Congress approved SOX in response

to the accounting scandals at the turn of the millennium. The

rules are designed to promote accounting accuracy to the

shareholders who have entrusted their savings to these firms.

A Government Accountability Office (GAO) report found that

companies with inferior financial reporting controls have a

significantly higher likelihood of issuing a restatement of

their financial accounts. Firms that are unwilling to oblige

SOX should not be trusted with the capital of savers.

Extending the CEO attestation requirement from five to 10

years exacerbates the problem. From an investor perspective,

accounting safeguards are more important for smaller

companies, since larger companies generally attract a larger

and more sophisticated base of stock and bond holders who can

perform effective oversight. We oppose this measure.

A third bill that is part of the H.R. 3978 package is the

National Securities Exchange Regulatory Parity Act (formerly

H.R. 4546). This bill would eliminate state supervision of

securities if they are listed on an exchange, even if the

exchange has reduced standards compared with those of major

exchanges such as the New York Stock Exchange. Under current

law, state supervision is pre-empted only if the security is

listed on exchanges with rules overseen by the Securities and

Exchange Commission (SEC). Rules may differ between

exchanges, but they must be approved by the SEC to ensure

that they prevent fraud, serve the public interest and

protect investors. Moreover, exchanges must adopt and enforce

rules that are ``substantially similar'' to the major

exchanges, known formally as ``Named Markets,'' under current

law. The existing system deters a race to the bottom, where

an exchange may attempt to attract companies with weaker

rules. Conversely, this bill would actually promote that race

to the bottom by removing the requirement that the exchange

adopt rules that are substantially similar to those of the

Named Markets. We oppose this measure.

A fourth measure in H.R. 3978 is the Protection of Source

Code Act, (formerly H.R. 3948). This measure would impede the

ability of the SEC to conduct effective compliance

examinations of market volatility involving computer-driven

algorithms. The bill imposes a strict subpoena requirement

before staff could inspect otherwise routine business records

that involve source code. Market volatility caused not by

real events such as the outbreak of a war, but by computers,

including computer glitches, threatens to erase savings to

some innocent investors and erodes general investor

confidence. The recent swings in the markets attest to the

need for robust and urgent supervisory inspection. The May 6,

2010 ``Flash Crash,'' where markets collapsed by more than $1

trillion in less than an hour, revealed that such robust and

urgent supervision has been lacking. The SEC required nearly

a half year to investigate this incident before identifying a

flawed algorithm at one major trader. SEC oversight should be

streamlined, not hampered. Trading instructions and records

of human traders are already subject to inspection, so it

should be no different for those instructions and records

generated by a machine. Hiding source code from regulatory

scrutiny will leave those responsible for mistakes as well as

those attempting to manipulate markets unaccountable. We

oppose this measure.

Because of our opposition to these elements in H.R. 3978

and to H.R. 3299 we urge you to vote NO on these bills. As we

are marking the 10th anniversary of the Wall Street Crash,

it's clear that American consumers and investors deserve

stronger financial reforms, not weakened protections that

will make our economy more susceptible to another collapse.

Thank you for your consideration. For questions, please

contact Bartlett Naylor.

Sincerely,

Public Citizen.

Madam Speaker, I continue to reserve the balance of my time.

Madam Speaker, may I inquire as to whether or not the chairman has more speakers?

Madam Speaker, I yield myself the balance of my time.

Madam Speaker, it has become par for the course for the majority to recklessly advance harmful deregulatory packages like H.R. 3978. My friends on the other side of the aisle are moving forward with regulatory roadblocks at a furious pace, pushing dangerous bills through the House nearly every week.

It appears that they may have already completely forgotten a way that lacks financial regulation and allowed the crisis in 2008 to occur. That crisis badly damaged the whole economy and harmed all of our constituents. The impact was enormous: $13 trillion in household wealth was lost; 11 million people lost their homes to foreclosure; and the unemployment rate reached 10 percent.

Democrats responded by enacting Wall Street reform to ensure that consumers, investors, and our economy are protected from reckless actors and bad practices, but now Republicans cannot wait to take us back to the bad old days. It makes no sense.

As we have discussed, the package of bills now before us guts important financial protections at a time when markets are already experiencing turmoil. It would allow high-frequency traders to manipulate the stock markets undetected, encourage a regulatory race to the bottom at our Nation's stock exchanges, and harm investors by weakening efforts to detect accounting fraud at smaller public companies. This package of bills threatens important progress we have made to reduce risk in the financial system and return investor confidence.

In recent weeks, we have seen volatile markets that threaten the savings of hardworking American families. These circumstances should serve as a clear reminder that Congress should be strengthening oversight of the financial system, not weakening it by undermining or removing important protections.

H.R. 3978 is strongly opposed by our State's security cops, who are at the front line of combating fraud, and it is opposed by groups representing consumers, investors, and unions.

Madam Speaker, for all of these reasons, I urge Members to oppose H.R. 3978, and I yield back the balance of my time.

Mr. Speaker, I include in the Record the following letters of opposition.

Center for American Progress,

Washington, DC, February 13, 2018.

Hon. Paul Ryan,

Speaker, House of Representatives,

Washington, DC.

Hon. Nancy Pelosi,

Democratic Leader, House of Representatives,

Washington, DC.

Dear Speaker Ryan and Leader Pelosi: The Center for

American Progress (``CAP'') is writing today to express

opposition to H.R. 4061, the Financial Stability Oversight

Council Improvement Act of 2017, which is included as Title

VI of the revised H.R. 3978 package. It is our understanding

that the revised H.R. 3978 package will be considered on the

floor of the House of Representatives this week, so we

welcome the chance to share our concerns regarding this

legislation with you and your Members.

In short, this bill erodes a vital new financial regulatory

tool implemented following the devastating 2007-2008

financial crisis. If enacted, the U.S. financial regulatory

structure will be less equipped to handle risks that build up

outside of the traditional banking sector--making the

financial sector as a whole more vulnerable to another shock

and economic downturn. Americans paid for the last crisis

with their jobs, homes, and savings, while banks and other

financial institutions were bailed out. This bill

inexplicably makes a repeat of that economic calamity more

likely.

The 2007-2008 financial crisis demonstrated that excessive

risk could build up outside of the traditional banking

sector. Nonbank financial institutions like Lehman Brothers,

Bear Stearns, and AIG did not face the type of oversight and

regulatory standards warranted by their systemic importance.

The failure or near-failure of these institutions threatened

the stability of the U.S. financial sector. AIG and Bear

Stearns were bailed out accordingly, while the failure of

Lehman Brothers brought the global financial system to the

brink of collapse. The crisis also revealed that no one

financial regulator had a system-wide mandate, meaning

individual regulators were only focused on their respective

segments of the financial sector. This left financial

regulators in the dark regarding risks that built up across

different parts of the sector or that emerged in

underregulated parts of the sector.

In the wake of the financial crisis, President Obama worked

with Congress to pass the Dodd-Frank Wall Street Reform and

Consumer Protection Act--the most significant financial

regulatory reforms enacted since the Great Depression. One

important pillar of Dodd-Frank was the creation of the

Financial Stability Oversight Council (``FSOC''), a new

systemic risk regulatory body. The FSOC was created to bring

the disparate financial regulators together to identify and

mitigate threats to financial stability. The most important

tool given to the FSOC to fulfill this mission is the

authority to subject a nonbank financial company to enhanced

oversight and regulation by the Federal Reserve Board if

material distress at the company, or the company's

activities, could threaten financial stability. The FSOC has

used this designation authority sparingly and only after a

thorough, multi-stage review process in which the FSOC

communicates extensively with the company and the company's

primary regulators.

H.R. 4061 would add multiple additional hurdles to the

FSOC's already-rigorous designation process. The proposed

changes would add an estimated two years to the designation

process, meaning it would take roughly four years for the

FSOC to designate a nonbank financial company that could

threaten U.S. financial stability. The four-year estimate

does not even factor in the time it will take for the legal

proceedings to play out when a company challenges the

designation in court. The legal challenge by MetLife took

years, and likely would have taken longer if the Trump

administration didn't agree to stop pursuing the case. If

anything, this bill increases the procedural issues a

designated company could raise in court. H.R. 4061

practically invites a legal filibuster of the designation. It

renders the designation authority nearly useless. Hollowing

out this crucial post-crisis authority makes it far more

likely that an underregulated systemically important nonbank

will cause or aggravate the next financial crisis.

Contrary to critics of the FSOC, it is not a rigid body and

has in the past responded to legitimate process and

transparency suggestions. In 2015, after soliciting public

comment, the FSOC adopted 17 changes to its designation

process and transparency policies The current designation

process in place is rigorous and appropriately thorough. H.R.

4061 would add no less than nine new bureaucratic steps.

These proposed changes are excessive, and the intent is

clear: To prevent the FSOC from using this vital tool.

This legislation is even more concerning given the actions

Treasury Secretary Steven Mnuchin, Chairman of the FSOC, has

taken since the start of the Trump administration. The FSOC,

under Mnuchin's leadership, has: (i) rescinded the

designation of AIG, the company that received a $182 billion

bailout during the crisis; (ii) slashed the FSOC's budget and

staff; (iii) dropped the legal proceedings regarding

MetLife's designation; (iv) signaled that Prudential's

designation may be rescinded this year; and (v) recommended

some deeply concerning additional changes to the FSOC's

designation process in a report published in late 2017.

Further restricting the FSOC's authority at a time when it is

being dismantled from within would be a grave mistake.

For these reasons, CAP recommends that Members vote ``NO''

when the revised H.R. 3978 package of bills, which includes

H.R. 4061, is considered on the floor.

If you have any questions about this letter or would like

to discuss these issues further, please contact Gregg

Gelzinis.

Sincerely,

Gregg Gelzinis,

Research Assistant, Economic

Policy, Center for American Progress.

Mr. Speaker, I rise in opposition to the amendment.

Mr. Speaker, the current language of title II of H.R. 3978 would require SEC examination staff to obtain a subpoena before it could inspect any source code whatsoever, including, for example, computer code reflecting a firm's adherence to the SEC's cybersecurity regulations.

The amendment offered by Mr. Foster would narrow the requirement in title II to only apply to proprietary source code related to algorithmic trading. While I applaud Mr. Foster and the amendment's cosponsor, Mr. Scott, for narrowing the overbroad language of title II, the amendment cannot fix this untimely and ill-advised legislation. Even as amended, title II would undermine effective oversight of the high-frequency traders that simultaneously create and stand to benefit from the kind of extreme market volatility that we have seen in the past few weeks.

Let's not forget that, on May 6, 2010, in an event referred to as the ``flash crash,'' major U.S. stock indices inexplicably plummeted nearly $1 trillion in less than an hour before mostly rebounding. Alarmingly, market regulators took nearly 5 months to determine that the flash crash was caused by a combination of a flawed execution algorithm of one institutional investor and aggressive algorithmic trading by HFTs.

While it is too early to tell exactly what created the recent volatility in the U.S. stock market, market analysts have suggested that algorithmic trading has played a central role. In fact, just last Tuesday, the day after the Dow Jones Industrial Average saw its biggest one-day point drop in history, Treasury Secretary Steve Mnuchin testified before the House Financial Services Committee that algorithmic trading ``definitely had an impact on market moves.''

Given the importance of algorithmic trading in our stock market, it makes no sense to obstruct the SEC's access to the information that enables such activity merely because it exists in an electronic format. Americans who have trillions of their dollars in 401(k) and other retirement and savings plans deserve the SEC's best efforts in investigating and mitigating computer-driven market disruptions. For this reason and for all of these reasons, and given my broader concerns that the bill would significantly harm investor confidence in our markets even if the amendment is adopted, I am urging a ``no'' vote on

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

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

Mr. Speaker, I rise in opposition to H.R. 4061, the so-called Financial Stability Oversight Council Improvement Act.

The bill would recklessly complicate the process used by the Financial Stability Oversight Council, also referred to as FSOC, to designate nonbank firms for heightened oversight and protect the economy.

The bill would also give companies more avenues to delay by at least 4 years or block these designations even when the designations are warranted.

According to former Treasury Secretary Lew, who previously chaired FSOC and strongly opposed this bill last Congress: ``An extensively long 4-year process to designate large, complex firms that pose significant risk to the financial system is not an improvement; instead, it would effectively render meaningless one of the most important tools we in future councils should have to address threats to financial stability.''

The nonpartisan Congressional Budget Office confirmed this view, finding that H.R. 4061 would increase the risk that undesignated systemic nonbank firms will fail.

Let me be very clear: This bill is a thinly veiled attempt to hinder and needlessly delay FSOC's existing ability to designate firms for heightened oversight.

Americans for Financial Reform has also underscored that this bill would: ``Provide giant, global financial firms numerous opportunities to use insider lobbying and the courts to delay or prevent actions that banking regulators are attempting to take to safeguard economic stability.''

One of the reasons Congress created FSOC was to make sure that large, interconnected firms like Bear Stearns, AIG, or Lehman Brothers would never again devastate the stability of our financial system and jeopardize our country's strong economy with their risky practices and relentless demand for profits over safe and sound operations.

So I simply cannot support this bill, which would add hurdles to prevent FSOC from fulfilling its vital role of identifying interconnected, huge companies that warrant enhanced safeguards.

I also reject the myths Republicans continue to spread about the Dodd-Frank Act in their effort to roll back so many of its critical reforms. The majority has claimed that Dodd-Frank has caused tremendous burden on the financial industry and resulted in lenders denying affordable access to credit to consumers and families, but the numbers tell the real story of the success of Dodd-Frank and the need to maintain its regulatory regime, including the FSOC. Why? Because bank profits and share prices have skyrocketed and are now far above pre- recession heights.

In addition, business lending has increased 80 percent and community banks are doing well.

What is more, pay for bank executives is through the roof. CEO pay on Wall Street is back up to levels we last saw in 2006. Even Wells Fargo's CEO, yes, the recidivist megabank that has violated numerous laws and harmed millions of consumers, was paid $17.5 million last year. In fact, the CEO was paid 291 times the median salary for Wells Fargo employees.

While Wall Street has fully recovered, Main Street has not. As Neel Kashkari, a Republican former Treasury official who now serves as the president of the Federal Reserve Bank of Minneapolis argued in a Washington Post op-ed on March 8, 2018: ``The Great Recession pushed millions of Americans out of the labor force, some of whom still haven't returned. Although the headline unemployment rate has fallen from a peak of 10 percent during the recession to 4.1 percent this past January, that statistic ignores people who have given up looking for work. A different measure of people in their prime working years suggests that more than 1 million Americans are still on the sidelines.''

Keep in mind, these are warnings from a Republican official. In fact, he goes on to say: ``Big banks still threaten our economy.''

So I will continue to oppose measures like H.R. 4061 that would return our regulatory regime back to a system that encouraged interconnected, huge firms to grow at all costs and that cheered as these firms devised new and so-called innovative products, many of which are only innovative in terms of how risky and unsound they were.

As so many have noted, if we undermine the ability of FSOC to stand guard, as this bill would do, then we risk opening the door once again to the wolves of Wall Street to wreak havoc with our economy again.

This bill, in effect, recreates the moral hazard in Wall Street's corporate culture that promotes profits before consumers. This bill would put the interests of corporate America before protections of consumers, the interests of the public, and the stability of the U.S. economy.

So, we must all remain vigilant against bills like this or we risk another financial crisis. I, therefore, urge my colleagues to learn from the mistakes of the past and oppose H.R. 4061.

Mr. Speaker, I am absolutely weary of coming to this floor with bills that deregulate megabanks. I am absolutely tired of coming to this floor having to remind my colleagues over and over again about the crisis that we had to be presented with and had to work through in 2008.

I don't know why it is our Members find so much time to protect the biggest banks in America, the richest banks in America, the CEOs who are making millions of dollars, while, in fact, the consumers come second or third in the work that they are doing.

This is simply about deregulation. This is about giving the banks more power. This is about disregarding the fact that we have had to fine them over and over again and they still find ways to defraud and to cheat the consumers of America.

As the chairman just mentioned about the fines of Wells Fargo, well, they are up for another fine of about a billion dollars because they cheated their clients, they cheated their customers, they created accounts in their names that they didn't know anything about, they forced insurance on them that they didn't need, many of them already had insurance, and it goes on and on and on.

I hope that we could convince our Members that we need to spend more time on some of the issues that are really confronting America.

I am on this committee as the ranking member. We don't have any bills or any sessions about homelessness. We are not talking about the people who are on the street all over America. We are not talking about the housing crisis where the average family even that is employed working every day can't afford to buy a home, now can't even afford to lease a place to live. It is off the scale.

I could go on and recount all of the things we should be addressing just in our committee, not to talk about the other things and issues in this Congress of the United States that we should be looking at, we should be paying attention to.

We have had all of the gun issues, we have all the issues that are going on now about Syria, and on and on and on, and yet we find the time to come to this floor day in and day out, time and time again, to talk about how we can make the biggest banks in America richer and more profitable.

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

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

I would like to just walk through some of what happens with FSOC with these nonbank designations and the process, because I have always wanted to be sure that the process would give these nonbanks an opportunity to basically convince FSOC that they were safe and they were sound and they didn't present any risk, and all of that.

Of course, a lot of this was triggered by AIG. If you remember AIG and what happened with this nonbank who was involved in credit default swaps without the collateral to back them up, this certainly was informative, and it helped to develop this process.

Stage 1, the metrics: minimum quantitative metrics for a nonbank financial company to be eligible for designation.

Stage 2, preliminary review, 6 months: staff analyzes preliminary data and meets with the company, consults with existing regulators.

Stage 3, in-depth review, 14 months: staff analyzes extensive data, meets with company, consults with existing regulators, FSOC deputies meet with company.

Proposed designation and hearing on the final designation, 4 months. FSOC provides written basis of proposed designation, oral hearings, provides lengthy written basis of final designation.

Total time from outset of analysis to final designation, 2 years.

Judicial and annual reviews: any designated company may challenge FSOC's determination in court; every designated company is re-reviewed by FSOC every year to consider de-designation.

I want you to know what is being proposed in this bill is quite different and, instead of the 2 years that I have just walked through, it would take approximately 4.3 years. At such time, you could have one of these nonbanks in trouble, presenting great risk, and you would not be able to do very much about it.

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

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

Mr. Speaker, I would like to share with Members a statement from the former Secretary of the Treasury who had the responsibility to head FSOC, and that is Jacob J. Lew. He said, and I will read from his communication to us:

Unfortunately, none of the legislation the committee plans

to consider this week--referring to this bill--would

strengthen the Council's ability to address the very real

risk the largest and most complex financial firms could pose.

Instead, these proposals would be a big step backwards for

regulatory tools to prevent the same kinds of threats. These

bills would severely undermine and impair the Council. One of

the proposals would require the Council to spend 4 years

analyzing a firm before taking action to address any risk the

firms may propose, doubling the time period for designation

review.

I reserve the balance of my time.

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

Mr. Speaker, I do think that it is important that we share as much information as we can about FSOC because not a lot is known by the average person about FSOC, and when we talk about it, we oftentimes fail to talk about who makes up FSOC.

We are talking about 10 voting members, headed by Treasury, the Treasury Secretary. You have on FSOC all of the experts. You have the Federal Reserve. You have the FDIC. You have the OCC. You have the NCUA. You have the CFPB, the FHFA, the SEC, the CFTC, and an independent insurance expert. So here you have convened on the FSOC all of these experts, and they are looking at nonbanks that could present great risk to our economy, like AIG.

I have to keep reminding people about AIG because AIG was this nonbank that we bailed out to the tune of about $182 billion, $183 billion.

Don't forget, they were involved with credit default swaps that were not

collateralized. They were basically putting insurance out there that, when the time came due for them to have to pay off, they couldn't because they didn't have the collateral to do that.

So with these experts, with the experiences that we have gone through, FSOC makes a lot of sense. And when it is said that all they can do is designate, that is extremely important because that gives the companies an opportunity to go back and take a look at themselves and see what they can do to reduce this risk to become more stable, and this has happened already.

As a matter of fact, I think to designate a nonbank, FSOC must have a vote of two-thirds of its members, including the Treasury Secretary. So this is not easily done.

Again, designation gives the companies an opportunity to go back and take a look. At least one of them has decided to downsize.

Let me just share this with you. First, FSOC is certainly not running a Hotel California. A designated firm like GE Capital was able to make the kind of risk-reducing structural reforms that led to their de- designation under the annual review process required by Dodd-Frank. So, no, designated firms are not stuck with their designation forever.

Don't forget, they get reviewed every year. Don't forget, they can make changes. Don't forget, they can take the advice. They can come in and they can continue to work on putting themselves in order so that they can get de-designated. And I think that is extremely important and that should not get lost.

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

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

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

Mr. Speaker, a moment ago, I identified the 10 voting members that serve on FSOC. I did not add to that the nonvoting members. To show you the expertise that is involved with FSOC, they also have these nonvoting members: Estate Insurance Regulator, Estate Bank Regulator, State Securities Regulator, and the Federal Insurance Office.

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

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

One of the wonderful things about working and living in a democracy is that people have an opportunity to have opinions and to voice them and to act out on them. And certainly we don't always agree on everything. The Republicans don't always agree in their caucuses. Sometimes they walk lockstep for all kinds of reasons, but they do disagree sometimes when they feel it is safe to do so.

But Democrats do not always agree, and we disagree perhaps more in our caucus than Republicans do, and we feel free to do that because we understand the importance of the democracy and what it permits and allows you to do.

So in saying that, we take every effort in my committee to make sure that all of our members have the information that they need. My staff is available to provide any assistance that we can provide. So we are very pleased and proud that I, as the ranking member, operate the committee in a way that respects all of its members.

And even those members who come to the floor who are opposed, perhaps, to a bill or are supporting a bill that I and others may oppose, I respect that. That is how democracy works.

So today, we do have Democratic members who are supporting this bill. For whatever reasons, they believe that FSOC perhaps is too tough on some of the companies, that somehow they really don't achieve their mission of reducing risk. Whatever it is they believe, they certainly have a right to do that. And I respect that.

Having said that, I believe that the lesson that we learn, as a result of 2008 and the recession that we went through, and AIG, the nonbank, in particular, that we bailed out when we saw the weakness of AIG, and the fact that they had basically dealt with these credit default swaps, and that it had created such a problem in our economy, I am so pleased that we had the foresight and the wisdom to come up with a way by which to identify this risk of the nonbanks so that they do not create the kind of turbulence and problems that we had in 2008.

Having said that, I am very pleased about the wide breadth of expertise that is on the FSOC. And I certainly believe that having gone through the steps that they take, that those steps will allow everyone to understand and see how fair they are, what kind of time it takes; and it gives every opportunity to be de-designated from being identified as a SIFI.

So I am very pleased and proud that I am able to say to my colleagues--no matter how they vote--that I believe that the FSOC is an important reform in the Dodd-Frank reforms. I would ask them to oppose this bill, but if they do not support it, I respect that. I think we should all remember that each and every one of us--elected by the people who send us here--have a voice and we have a right to represent our constituents in the best way that we see possible.

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

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

In these debates, oftentimes we find ourselves explaining to people how our committees work, and that is very good that we take the opportunity to do that because I think that, in this complicated system that we work in, people need to understand what we do and how we do it.

I am very appreciative to the chairman for recognizing and giving time to some of our Members today, and I think he will remember that I have done that for him also. I can recall on flood insurance, the National Flood Insurance bill, I was very gracious and I gave Members on the Republican side of the aisle an opportunity to have a say. And not only that, Ex-Im Bank was another instance where I gave time to the Members from the opposite side of the aisle, so I would not like people who are listening to think that somehow this is unusual.

We do use the influence and power of our positions to determine when that makes good sense for us, and I would like to say to the chairman of our committee: There will be other times when I will afford Republicans an opportunity to speak and have their say when you don't feel that that is the proper thing for you to do at that time. So let us all remember how this system works.

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

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

Mr. Speaker, week after week, the majority is continuing to push through bills to roll back critical reforms that Democrats put in place to protect consumers, investors, and our economy. Let's recount some of the bills that the majority has recently pushed through the House:

In recent months, they have passed legislation to allow payday lenders to evade State interest rate caps, decrease operational risk capital requirements, and roll back enhanced prudential standards for the Nation's largest banks; weaken customer protections for mortgages; undermine efforts to combat discriminatory and predatory lending; reduce consumer privacy protections; weaken rules that the financial services industry finds inconvenient; undermine protections for mom- and-pop investors; and allow financial institutions to challenge rules, financial regulations, in court, if they believe them not to be uniquely tailored to their business needs.

Every week, the list of harmful legislation put forth by the majority for House passage grows. H.R. 4061, the so-called Financial Stability Oversight Council Improvement Act is the latest example of the majority's misguided and reckless agenda.

H.R. 4061 helps financial institutions to delay or block heightened oversight and weakens FSOC's ability to protect our economy. Mr. Speaker, this bill ignores th lessons of the past and invites the return to the risky financial system that led to the financial crisis.

Mr. Speaker, I urge my Members to oppose the bill, and I yield back the balance of my time.

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

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

This is a very important bill that I am asking the Members of Congress to vote ``no'' on because we don't want to empower the megabanks and huge conglomerates to be able to skirt adverse supervisory decisions about regulators.

The bill would give all financial institutions, regardless of their size, an additional method to appeal, thereby significantly delaying adverse determinations by creating a new independent review office to conduct de novo reviews without concern for the institution's safety and soundness or the protection of consumers.

This bill goes far beyond relief for community banks and credit unions by enabling megabanks and nonbanks, like payday lenders and Equifax, to pursue limitless challenges to the agency's actions in court.

If you take a look at the examples that we have prepared for you, take a look at Wells Fargo. Wells Fargo has been at the center of attention in this country for the fraudulent accounts that it established using their customers' accounts and information to create more accounts without informing their customers; and then they had the illegal student loan servicing practices that we have all been so concerned about; and even after the fraudulent accounts were exposed and a fine was made because of the harm that they had caused to their customers, we then found that they had inappropriate force-placed insurance, which means that people who were already paying for their insurance were forced to pay again because the bank basically forced them to have additional insurance.

And then there is J.P. Morgan with illegal credit card practices and discriminatory lending, sale of bad credit card debt, and illegal robo- signing.

And Citi with deficient mortgage servicing and foreclosure processing practices; inappropriate fees, marketing, billing, administration of add-on products; and foreclosure abuses.

Bank of America, also mortgage abuses, deficient mortgage servicing and foreclosure processing practices, credit monitoring abuses, deceptive marketing for add-on products, violations of the Servicemembers Civil Relief Act.

Now, we find that these banks have determined--they act in ways that we know that fighting is just the cost of doing business. It is a slap on the wrist. And they are going to continue to be able to get away with this. And if they are saying that the bank examiners who come in and find these adverse conditions somehow will be ignored and they can literally get around them, then we are going to add to the problems of our consumers in this country.

Mr. Speaker, I am certainly asking for a ``no'' vote on this bill, and I reserve the balance of my time.

I yield myself such time as I may consume.

Mr. Speaker, I always have these lively debates with my chairman, and he never fails to point out that I voted for the bailout. And, of course, oftentimes when he comes with one of these deregulation bills, he talks about bipartisan and how he had Democrats. Well, I want you to know the bailout was a bipartisan thing. It was appointed by both Democrats and Republicans at a time when we were in great difficulty in this country.

It was the Bush bailout, and it was Mr. Paulson, appointed by Mr. Bush, who was the Secretary who led it and gave us the advice and had us participate in saving our economy based on the information that he had uncovered about the risk that was now proposed for our country.

So I am not for bailing out big banks at all. We had an emergency situation in this country where, again, it was the Bush bailout that we had to deal with the fact that we were in great danger. But let me just also say this: we have something now that we put into Dodd-Frank reform called the Orderly Liquidation Authority scenario that we are able to look at banks, and, because of the stress testing that they have gone through, if there is a need for an orderly resolution because there are problems with the bank, we cannot only recommend breaking off parts of the bank, but reordering parts of the bank and doing what is necessary to ensure that the bank does not get into a situation where it fails and triggers the failures of others in our economy.

So it is the Orderly Liquidation Authority that I am referring to, and I do not support bailing out big banks. This is one thing that I join with my chairman on. We both agree that we should not be bailing out these big banks. And, of course, that is what Dodd-Frank is helping us to avoid.

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

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

Mr. Speaker, I appreciate the offer from my good friend to join him, but I don't think I will be doing that today.

Mr. Speaker, I include in the Record organizations that have sent us information in opposition to this bill. It includes the National Consumer Law Center, AFSCME, the Center for American Progress, and Americans for Financial Reform.

National Consumer Law Center,

Washington, DC, March 8, 2017.

Re Oppose S. Amdt. 2140 (Moran), HR 4545, The Financial

Institutions Examination Fairness Act; creates roadblocks

to bank supervision for safety and soundness, consumer

protection.

Senator,

U.S. Senate, Washington, DC.

On behalf of our low income clients, I urge you to oppose

Senate Amendment 2140 to S. 2155, which incorporates HR 4545

(Tipton), The Financial Institutions Examination Fairness

Act. The bill would create unprecedented barriers to

effective prudential and consumer protection supervision of

banks, allowing banks to resist corrective actions to address

law violations or safety and soundness risks, bogging down

agencies with frivolous appeals.

HR 4545 would grant regulated banks the right to appeal any

supervisory determination made by any prudential banking

agency or by the Consumer Financial Protection Bureau (CFPB)

to a new ``Office of Independent Examination Review''

established in the Federal Financial Institutions

Examinations Council (FFIEC). Upon appeal by a supervised

bank, this new office would be required to undertake a

repetitive de novo review of the agency's supervisory

decision. No deference to the initial examination findings or

the agency's judgment would be required in this review.

This new process is duplicative to appeals processes and

ombudsmen already present. The CFPB, FDIC, OCC, Federal

Reserve, and National Credit Union Administration each

already have an agency ombudsman and an intra-agency formal

review and appeals process. In addition, banks may bring a

court challenge to any formal regulatory enforcement action.

HR 4545 would enormously increase the ability of banks to

resist supervisory decisions. This effect would be most

pronounced at the largest banks, who could appeal dozens or

hundreds of material findings from every examination,

creating enormous roadblocks to supervision. The bank

supervision process has been the first line of regulatory

defense against threats to bank safety and soundness for a

century or more. HR 4545 creates unprecedented roadblocks to

the effectiveness of bank supervisory determinations and

could be devastating to effective regulatory oversight in

areas ranging from basic

prudential oversight to key consumer protections that make

our financial markets fairer.

I urge you to oppose HR 4545 and any amendment that

incorporates the bill.

Yours very truly,

Lauren K. Saunders,

Associate Director.

Mr. Speaker, let me just read one of the paragraphs from the Center for American Progress that I think is so profound.

``The Financial Institutions Examination Fairness and Reform Act, would give financial institutions the authority to appeal any material examination decision rendered by the Federal banking regulators or Consumer Financial Protection Bureau, CFPB, to the Office of Independent Examination Review--a new office created by the bill. Financial regulators already have internal appeals processes in place through their respective ombudsman offices and financial institutions can pursue legal remedy for flawed examination decisions through the judicial system.

``This new office and review process is simply an additional hurdle for regulators to contend with when supervising financial institutions and an additional point at which institutions can slow down or avoid punishments. H.R. 4545 would undermine the examinations process at a time when supervisory authority and penalties for financial sector malfeasance should be strengthened.''

In addition to that, there is another paragraph in the letter from Americans for Financial Reform that I think is extremely important in explaining why this bill should be opposed.

It says: ``By layering an entirely new appeals process on top of existing processes, this bill would greatly increase the ability of banks to resist supervisory oversight and ignore or delay changes called for by supervisors. The impact would be most pronounced at the largest banks, which can receive dozens or hundreds of material findings from every examination. The ability to appeal every one of those material supervisory findings, or just to threaten to appeal them, would create an enormous new barrier to effective supervision of big banks.''

In essence, Mr. Speaker, what we are saying is, we have our bank examiners who are going in and looking for ways to strengthen the banks and hoping that they will not find these adverse conditions, but, if they do, they have a responsibility to the consumers to try and get them corrected or to try and get changes made.

This bill says, despite adverse conditions that are discovered, we don't want to have to comply; we don't want to have to change; we don't want to have to correct. We want to fight you. We want to use our vast resources to say your examiners didn't know what they were doing.

They are not so much concerned about the consumers; rather, they are more concerned about just being a part of the bureaucracy.

It doesn't make good sense what they are saying about the examiners and why they are not important.

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

Mr. Speaker, may I inquire as to how much time I have left.

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

Mr. Speaker, H.R. 4545 is yet another harmful bill that would help out Wall Street and predatory lenders. It has become a theme for the majority to claim that their legislation is meant to provide relief for small community banks, when, in fact, the legislation plainly benefits the Nation's largest banks, including abusive megabanks like Wells Fargo and even payday lenders. This bill is yet another example.

The bill would allow any bank as well as any nonbank supervised by the Consumer Financial Protection Bureau to appeal negative supervisory determinations made by regulators in the examination process.

H.R. 4545 makes it more likely that bad actors, including predatory megabanks like Wells Fargo, would avoid or delay accountability when they break Federal law. It takes our system of financial regulation in exactly the wrong direction.

Megabanks like Wells Fargo already treat the fines they are required to pay for violations of the law as simply the cost of doing business. They don't need more escape routes to avoid accountability for their wrongdoing.

I have made it clear many times that abusive megabanks with egregious patterns of harming consumers should face steep penalties from regulators. Last year I introduced H.R. 3937, the Megabank Accountability and Consequences Act, which would require the Federal prudential banking regulators to fully utilize existing authorities, such as the ability to shut down a megabank and ban culpable executives and directors from working in the banking industry.

To get tough on megabanks that repeatedly engage in practices that harm consumers, Congress should be focused on measures that strengthen consumer protections, provide tailored, responsible relief for community banks, and ensure that abusive megabanks are held accountable. This bill, which would help megabanks and predatory lenders get off the hook when they break the law, should be rejected.

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

Mr. Speaker, I have an amendment at the desk made in order under the rule.

Mr. Speaker, my amendment is fairly straightforward. It would limit the applicability of the exam reforms under H.R. 4545 to only depository institutions with assets less than $10 billion.

I have only heard about community banks and credit unions with respect to concerns regarding their exam process and the ability to enhance the opportunity to appeal exam findings. As Ms. Maloney made clear, when the committee marked up this bill, the sole purpose of the bill was to help community banks and credit unions, so my amendment seeks to narrow the scope of the bill's relief to these small firms.

Congress used a similar $10 billion asset threshold in Dodd-Frank to exempt small banks and credit unions from the Consumer Bureau's supervision, so applying a similar threshold for the purpose of appealing bank supervisory findings makes sense.

Today, 98 percent of all banks and 99.8 percent of all credit unions have less than $10 billion in assets. While I am in favor of sensible relief for smaller financial institutions, I believe that the 2007-2009 financial crisis showed the dangers of weak oversight of these big banks, including a $30 billion bank like IndyMac. The bank's costly failure was the fourth largest in the history of the United States and contributed to the most damaging financial crisis in generations.

As the largest firms pose the greatest risk to the country's economy and the safety and soundness of our financial system, it is only prudent to apply a stringent supervisory approach for the largest institutions. In fact, the GAO issued a report last year criticizing the

Federal Reserve's large bank supervision program, underscoring there is more work that must be done.

I have been pushing bank regulators to deploy the full suite of their enforcement tools against megabanks like Wells Fargo that repeatedly and carelessly break the law and harm millions of consumers. That is why I introduced, again, H.R. 3937, the Megabank Accountability and Consequences Act.

So, no, I do not think it is appropriate to let megabanks like Wells Fargo hijack what should be regulatory relief for community banks so that they can challenge their exams. Nonbanks regulated by the Consumer Bureau, like Equifax or payday lenders, do not need this kind of regulatory relief either.

My amendment narrows the scope of the bill on what should garner broad bipartisan support: sensible relief for the community banks and credit unions that need it.

Mr. Speaker, I would urge my colleagues who truly want to help community banks and credit unions rather than Wall Street megabanks to support my amendment.

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

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

Madam Speaker, pursuant to House Resolution 736, I call up the bill (H.R. 3978) to amend the Real Estate Settlement Procedures Act of 1974 to modify requirements related to mortgage disclosures, and for other purposes, and ask for its immediate consideration in the House.

Madam Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and submit extraneous material on the bill under consideration.

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

Madam Speaker, I rise today in strong support of H.R. 3978, which is a package of five strongly bipartisan bills, yet again, from the Financial Services Committee of the House. As standalone bills, all were favorably reported, again, with strong bipartisan support of at least three-quarters of the committee.

The title provision of this package is the TRID Improvement Act by Congressman French Hill. This bill amends CFPB's complex TILA/RESPA integrated disclosure, known as the TRID rule, in order to simplify the closing documents consumers get when they close a mortgage.

It does this by allowing for the calculation of the discounted rate that title insurance companies provide to consumers when they purchase a lender's and owner's title insurance policy simultaneously. This makes it more accurate, Madam Speaker.

Title II is the Protection of Source Code Act introduced by Representatives Sean Duffy and David Scott, a Republican and a Democrat. This provision ensures that the Securities and Exchange Commission cannot require financial services firms to disclose algorithmic trading source code without first obtaining a subpoena. Source code is among a firm's most sensitive information, and this bipartisan provision balances privacy and due process concerns while preserving the SEC's ability to obtain such information when necessary.

The third title is the Fostering Innovation Act which was introduced by Representatives Sinema and Hollingsworth to provide relief to small and emerging businesses by extending the popular onramp exemption of the JOBS Act for emerging growth companies in a more tailored manner. In short, it provides emerging growth companies more time to reach a size when they reasonably can be expected to financially sustain the legal, accounting, and compliance costs associated with the full Sarbanes-Oxley section 404(b) compliance.

Fourth, Madam Speaker, is the National Securities Exchange Regulatory Parity Act which was introduced by Mr. Royce and which will ensure further clarity and competition among national security exchanges by modernizing the blue sky exemption in the Securities Act. Modernizing this provision will ensure all national security exchanges operate on a level regulatory playing field and help protect retail investors from arbitrary acts by State regulators that may bar investors in one State from buying stock freely available to investors in every other State.

The final title of this bill is a provision introduced by Congressman Stivers to allow mortgage loan originators who work as loan officers in banks and credit unions to transition to a new job at a nonmortgage company without losing the ability to originate loans. Without this bill, the transition process can take weeks or months depending on the State.

Each of these measures, Madam Speaker, will cut through layers of red tape and help level the playing field making regulations smarter, fairer, clearer, and more efficient, thus ensuring that there are more competitively priced credit opportunities, more credit opportunities for consumers, and that investors have greater investment opportunities in competitive markets. They will provide commonsense regulatory relief. They are practical, they are bipartisan, and they are needed.

Madam Speaker, I encourage all of my colleagues to support the measure, and I reserve the balance of my time.

Madam Speaker, I yield 5 minutes to the gentleman from Arkansas (Mr. Hill), the majority whip of the committee and the sponsor of the legislation.

Madam Speaker, I yield 4 minutes to the gentleman from Wisconsin (Mr. Duffy), the chairman of the Subcommittee on Housing and Insurance and the sponsor of title 2 of the Protection of Source Code in this bill.

Madam Speaker, I yield an additional 30 seconds to the gentleman from Wisconsin.

Madam Speaker, I yield myself 30 seconds to say the widespread opposition to the bill alluded to by the ranking member doesn't include roughly half the Democrats on the committee, including the gentleman from Illinois (Mr. Foster), who was quoted in our markup as saying: ``As someone who can code in at least seven languages, I understand that source code is qualitatively different from other documents that a firm might have and that our regulators should have legitimate access to. They are truly the crown jewels of an electronic trading firm, and there are obvious dangers that have been exposed in transferring things really not just to the government, to any entity. The first line of defense in cybersecurity is to keep the data as closely held as reasonable and still be able to do your job.''

Madam Speaker, I reserve the balance of my time.

Madam Speaker, I yield 2 minutes to the gentleman from Illinois (Mr. Hultgren), the vice chairman on the Subcommittee on Capital Markets, Securities, and Investment.

Madam Speaker, I yield 2 minutes to the gentleman from Texas (Mr. Williams), the vice chairman of our Subcommittee on Monetary Policy and Trade.

Madam Speaker, I yield 2 minutes to the gentleman from Maine (Mr. Poliquin), a hardworking member of the Financial Services Committee.

Madam Speaker, I yield 2 minutes to the gentleman from New York (Mr. Zeldin), another member of the Financial Services Committee.

Madam Speaker, I yield 2 minutes to the gentleman from Georgia (Mr. Loudermilk), another proud member of the Financial Services Committee.

Madam Speaker, I would tell the ranking member that I have potentially two speakers, if they make it. They are on their way from a hearing, but they are not here now.

Madam Speaker, may I inquire how much time I have remaining.

Madam Speaker, there may be other Members coming, so, at the moment, I yield myself 4 minutes.

Madam Speaker, again, all over America today, fortunately, because of the Tax Cuts and Jobs Act, people are waking up to new opportunities. They are finally seeing their wages begin to grow. We have seen the greatest wage growth in almost a decade, Madam Speaker, again, thanks to President Trump and thanks to a Republican Congress, a bill that was opposed by every single Democrat.

But as they wake up to these new opportunities, Madam Speaker, they also need new credit. As their incomes rise--this is good--they still need credit in order to buy a home, in order to purchase that car, and sometimes just to put groceries on the table. Unfortunately, over the last 8 years of the Obama administration where we saw probably one of the greatest increases in the cost, expense, and burden of costly Washington red tape, we have seen fewer credit opportunities.

So now, fortunately, today there are good men and women on both sides of the aisle who are trying to work together to bring some rationale and reason to the regulatory burden. Many Members on the other side of the aisle do realize that Dodd-Frank did not come down as tablets from Mt. Sinai, that it isn't chiseled into stone, and that maybe there are some improvements that could be made.

So today, we are taking a number of very bipartisan bills to the House floor. The Protecting Consumers' Access to Credit Act, which we debated earlier, Madam Speaker, passed by 42-17.

The TRID Improvement Act by Mr. Hill from Arkansas passed through our committee 53-5--90 percent. Almost all of the Democrats but the ranking member supported the bill. The Protection of Source Code Act, 46-14; the Fostering Innovation Act passed by a vote of 48-12, a Democratic bill; the National Securities Exchange Regulatory Parity Act, 46-14.

We have a lot of bipartisan bills, but with one exception, title V of the TRID Improvement Act, none of them were supported, unfortunately, by the ranking member.

So there is, again, a lot of bipartisan work we are trying to get done here. Unfortunately, very little of it is supported by the ranking member.

And why is this important? It is important, Madam Speaker, because every day we are still hearing from our constituents who need access to competitive affordable credit. And because of this Washington red tape and regulatory burden, they are not getting it.

It wasn't that long ago we heard from Ann of Wisconsin, who said:

My husband and I had very high credit scores. We have

plenty of equity in our home. But because my husband has a

seasonal job and finds other employment in the winter, many

banks we contacted rejected our loan request. They based our

annual income only on the job he has currently and said that

was part of the new regulations.

Part of the new regulations--there is somebody who won't buy a home; they can't get a home.

I heard from a mortgage banker in North Carolina who said:

Last year, we declined a young man and his family fixed

rate financing to purchase a primary home. The applicant

recently relocated to work for a family business. Prior to

Dodd-Frank, it would have been easy to qualify, but no more.

Another potential American home buyer denied credit because of this regulatory burden. Madam Speaker, that is what many of us, on both sides of the aisle, are trying to remedy today.

Madam Speaker, I am pleased to yield 2 minutes to the gentlewoman from Arizona (Ms. Sinema), a sponsor of title III of the Fostering Innovation Act.

Mr. Speaker, may I inquire how much time I have remaining.

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

Mr. Speaker, once again, I want to hear the voices of hardworking Americans, not just Washington, D.C., letterhead groups.

We heard from a community banker, who said:

A local union member wanted to refinance his primary

residence. He was currently laid off due to the winter

season. His tax return showed he was generally laid off for

about 6 weeks each year during the extreme cold but was

always called back when weather improved. Since he was laid

off, we could not meet the requirement to validate his

current income that would continue for 3 years. We had to

deny the loan.

Yet again, Mr. Speaker, more Washington red tape taking away home opportunities from hardworking Americans. It is wrong. We must do something about it. It is why, on a bipartisan basis, so many of us have gotten together to pass H.R. 3978.

Yes, we want to make sure that people can buy homes, they can buy cars, they can put groceries on the table, and right now, when the economy is finally starting to improve, thanks to President Trump and the Tax Cuts and Jobs Act, we want them to have opportunities.

Mr. Speaker, I encourage all Members to support H.R. 3978, and I yield back the balance of my time.

Mr. Speaker, I reserve a point of order on the gentleman's motion.

I object.

Mr. Speaker, I withdraw my reservation of a point of order.

Mr. Speaker, I claim time in opposition.

Mr. Speaker, I listened very carefully to my colleague on the Financial Services Committee. I lost track of how many times he mentioned Wells Fargo. That has nothing to do with an early growth company. That has nothing to do with this title of the bill.

So the Fostering Innovation Act by the gentlewoman from Arizona is all about allowing emerging-growth companies the opportunity to actually grow. What a novel concept.

What we know is, Mr. Speaker, in 8 years of Obamanomics, they were only able to produce about 1.8 percent economic growth, for all intents and purposes. Nobody's savings account came back. Wages were stagnant. And now that we have sensible regulation, now that we have passed the Tax Cuts and Jobs Act, now we have 3 percent economic growth, which is economic growth for America's working families. Unemployment is at a 17-year low. It remains at a 17-year low.

Again, wages grew at 2.9 percent last year, the fastest in almost a decade. Two million Americans have gone back to work, Mr. Speaker, and this is not by accident.

So what the gentleman is doing with his motion to recommit is sending us back. He is rolling the clock back to an era where working Americans didn't get ahead, where entrepreneurship was at a generational low, where small businesses were finding it hard to access lines of credit. So the bill that he so much maligns from the gentlewoman from Arizona, who happens to reside on his side of the aisle--at markup, the ranking member of the relevant subcommittee, the gentlewoman from New York (Mrs. Maloney), supported the provision and said: This is a sensible compromise that provides a narrowly targeted relief to only the companies that truly need it.

Researching a new drug and getting FDA approval is a very, very long process, which is exactly what we heard in our committee. For example, we have heard from John Blake, senior vice president of finance at Atyr Pharma, who testified before the Subcommittee on Capital Markets, Securities, and Investments. He said: It remains the case that the biotech development time line is a decades-long affair. It is extremely likely that Atyr will still be in the lab, in the clinic, when our EGC clock expires, our early growth company.

In other words, they may have revenues, but they don't have profits. They don't have profits. This is something that is especially common in the biotech area. They need this capital for innovation.

So once again, we have heard this rhetoric on the other side of the aisle before. This is all about Dodd-Frank revisited. They aim at Wall Street, but they are hitting Main Street, Mr. Speaker. The MTR, the motion to recommit, hits Main Street in the gut. It will mean fewer early growth companies. It will mean fewer jobs. It will mean lower wage growth. And it will mean, again, a decimated and declining American Dream.

Mr. Speaker, we should reject the motion to recommit, and we should support the underlying bill.

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

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

I thank the gentleman from Colorado for yielding me the customary 30 minutes for debate.

Madam Speaker, today's bills would roll back important consumer and financial protections by undermining the effectiveness of financial regulators' ability to conduct important stress tests, create unnecessary hurdles for regulators to contend with in the future, and limit the Federal Reserve Board's flexibility in determining the health and stability of our financial institutions.

Madam Speaker, including these two measures, the Rules Committee will have considered 30 Financial Services bills this Congress, 15 of which were considered under closed rules. Those 15 are part of a much larger closed process that Republican leadership has wielded with brute force to push through the legislative priorities of powerful special interests. Indeed, this week, we witnessed the 73rd closed rule for this Congress, a style of legislating that is as brazen as it is broken.

This critique of the majority's reliance on a closed process is not just some technical point, but, rather, an important one; because when you close out those on your side of the aisle who are not in leadership and those on our side of the aisle from offering amendments, you do not simply silence us, you silence the American people.

And what has this process wrought for the American people?

Well, let's take a look. Bear with me because it is a doozy

First, we witnessed the majority--in what I believe was the most chaotic and convoluted process during my 25 years in the House of Representatives--try to take away healthcare from 23 million Americans.

When they couldn't get that done, the majority then honed in on a tax giveaway to corporate America and the ultrawealthy not only at the expense of the middle class, but also to the detriment of future generations, as that bill will explode our national debt by an estimated $1.5 trillion over the next 10 years.

Just last week, we watched as our Republican friends attacked Clean Air Act protections to give a handout to specified industries to emit more pollution into the air.

Is this what my Republican friends were sent here to do: To take away healthcare from millions of people? To remove important environmental protections that keep America's air and water safe? To limit the amount of stress tests the Federal Reserve Board should run on our biggest financial institutions so that we can avoid another financial meltdown?

Footnote right there. If these stress tests are so bothersome to these big old banks, how is it that they are making all of this big old money?

They don't seem to have any hindrance when it comes to sopping up the resources of this country.

Madam Speaker, my constituents haven't been calling me or writing or emailing my office asking that we consider or pass any of the measures the House will consider this week. On the other hand, they have written to my office asking what Republican leadership is going to do about addressing the gun violence epidemic ravaging our country. I was meeting in my office just an hour ago with officials from Tamarac, Florida, and we received an alert that two schools near the Parkland school were on lockdown.

My constituents have asked about what Republican leadership will do to ensure that the DACA recipients have a pathway to citizenship. They have asked what Republican leadership will do to address our Nation's needs for serious and sustained investments in our infrastructure. Unfortunately, the answer is little to nothing.

Footnote right there. When I came to this Congress 25 years ago, there were 14,000 bridges in the United States of America in need of a repair. Today, there are 56,000 bridges in this country in need of repair.

Madam Speaker, since 2014, there have been over 1,360 mass shootings in America. Let me let that soak in. Since 2014, there have been over 1,360 mass shootings in America.

In 2018 alone, nearly 500 teens and over 100 children have been killed or injured by guns. Last month, 14 students and 3 teachers were gunned down at Marjory Stoneman Douglas High School by a former student using an AR-15 that he bought legally.

And just 2 days ago, American citizens took to the grounds of this Capitol and placed 7,000 pairs of shoes on the front lawn here at the Capitol. Citizens placed a pair of shoes for every child killed by gun violence since the Sandy Hook massacre. Regardless of your views on this subject, please let that number sink in: 7,000 pairs of shoes.

Madam Speaker, we should not be considering a bill to reform the Financial Stability Oversight Council. We should not be considering a measure that limits the frequency of stress tests on our financial institutions.

What we should be doing is considering a ban on bump stocks. We should be considering a ban on weapons of war. We should be considering protective orders allowing people to petition a court to temporarily remove firearms from an individual in crisis.

We should be considering a measure to provide for comprehensive background checks, and maybe this time try not to sabotage it by attaching a controversial concealed carry provision to the measure.

Madam Speaker, the Republican majority is also ignoring the plight of 22,000 Dreamers who have lost their protected status since President Trump ended DACA, and the other hundreds of thousands of Dreamers who remain in legal limbo. Every day, 120 of them lose their status.

Madam Speaker, 25 times--25 times--House Republicans blocked a vote on the bipartisan Dream Act, which protects innocent Dreamers from this cruel Republican inaction. Every day of inaction on the part of my friends across the aisle means another day that families are needlessly made to live under the threat of being torn apart.

Madam Speaker, all across America, our infrastructure is in need of repair and greater investment. Every Member in the House of Representatives likely received a visit from members of the National League of Cities around the United States of America, and every one of them is talking about infrastructure needs. Every one of them. Yet the Republican majority has stalled on presenting a single infrastructure bill.

Even President Donald John Trump's infrastructure plan faces an obstacle: his own budget cuts.

President Trump claimed the Federal Government was investing $1.5 trillion to our infrastructure, but, in reality, the White House's plan actually only proposed $200 billion in Federal funding. At the same time, he proposed slashing critical infrastructure funding to the Department of Transportation by nearly 20 percent, and the Army Corps of Engineers' budget by 22 percent.

How does that work, Madam Speaker?

The truth is, it doesn't.

Madam Speaker, we stand here today with a to-do list a mile long and an ocean wide. I suggest the following: that we stop being forced to spend our time checking off items on the wish lists of powerful corporate special interests, and we turn to the business of the American people--Republican and Democrat, independent, conservative, and liberal American people.

For starters, we could work together to end our country's gun violence epidemic, bring relief to DACA recipients, and bring thought- out and serious legislation to the floor that will invest in our infrastructure.

Now, I am sure that my friend is either thinking or likely to say that we are here about financial services measures, and he is correct. That is what these rules call for. But what these rules are about, in the final analysis, is a diversion from things that we know are more critical.

Why, then, are we not dealing with prioritized matters that we know that the American people want, rather than those that the corporate greedy, needy, big old businesses want?

Madam Speaker, I reserve the balance of my time.

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

Madam Speaker, it has been one month since the tragic events at Marjory Stoneman Douglas High School in Parkland, Florida. The district that I am privileged to serve is adjacent to that school, and I have two of my remaining cousins in life that live in Parkland, and I live within 30 minutes of where that school is situated.

A gunman killed 17 innocent students and teachers. Since that heartbreaking day, Americans from coast to coast have raised their voices and said: Enough is enough.

Yesterday, thousands of students from across our country walked out of their classrooms to protest this body's inaction. Two days ago, as I said earlier, 7,000 empty pairs of children's shoes were laid on the Capitol lawn to commemorate all the children who have been tragically killed by gun violence since the 2012 Sandy Hook Elementary School shooting. I might add, not only at schools, but in Nevada, in California, in Texas, in South Carolina, in churches, in Orlando bars, these mass shootings are occurring. People don't think it is an epidemic.

My friends on the other side of the aisle did bring a bill to the floor yesterday that I voted for that was also cojoined by my friend, Ted Deutch, whose district is where the Parkland school is. He, too, was involved with that legislation, but it was done to improve school security. Much more needs to be done, and it needs to be done now.

So, today, I offer my colleagues yet another opportunity to show the American people that they value their safety and the safety of their children over the lobbying of the National Rifle Association and the gun manufacturers.

If we defeat the previous question, I will offer an amendment to the rule to bring up four commonsense gun safety bills: H.R. 4240, the Public Safety and Second Amendment Rights Protection Act; H.R. 3464, the Background Check Completion Act; H.R. 2598, the Gun Violence Restraining Order Act; and H.R. 1478, the Gun Violence Research Act.

These bills would close the dangerous gun show and internet sale background check loopholes, prevent the sale of guns without a completed background check, ensure that people who are a danger to themselves or to others can be prevented from possessing a gun, and lift the prohibition on government-sponsored scientific research on causes of gun violence.

Let me send a message to gun owners in this country. I own a gun. I believe in the Second Amendment. I don't want anybody to take anybody's gun; but nobody can persuade me that anybody, other than military and police officers, are deserving of having in their possession automatic weapons. I believe every American feels the same way.

Madam Speaker, I ask unanimous consent to insert the text of my amendment in the Record, along with extraneous material, immediately prior to the vote on the previous question.

Madam Speaker, I yield 4 minutes to the gentleman from South Carolina (Mr. Clyburn), my very good friend that I knew before we came to Congress together, and the distinguished assistant Democratic leader.

Madam Speaker, I yield 3 minutes to the gentleman from California (Mr. Carbajal), a member of the Armed Services and Budget Committees of this House of Representatives.

Madam Speaker, I yield 3 minutes to the gentlewoman from Florida (Mrs. Murphy), my colleague who represents my home area that I was born in, a member of the Armed Services and Small Business Committees.

Madam Speaker, I yield myself the balance of my time.

Madam Speaker, I would advise the previous speaker that I knew Jay Dickey, I served with him here, as did many other Members; and my understanding is that, before his death, he indicated that he thought that his measure that has carried forth was a mistake.

Madam Speaker, my friends across the aisle have clearly demonstrated where their priorities lie. And for the benefit of the American public, if it looks like we are ships passing in the night, then doubtless we are when it comes to priorities.

I would ask anyone in this country and anyone in this House: Which do you think should be a priority? Addressing the gun epidemic in this country or bailing out big old banks with more opportunities to potentially carry us to yet another financial disaster by simply disallowing them having to undergo the stress test that they need?

I listened to my friend when he talked about stress tests, that they don't know how they are going to be tested or what part they are going to--well, my goodness gracious. Kids in school don't know what is going to be on the test; so why should the bank know what is going to be on the test?

But in the deal, when it goes down, whether they know or not, they still are making a ton of money; and, therefore, the regulations aren't affecting them in the way that we make it sound here. And there again, I ask the question: Which is your priority, America? Whether we address gun violence in this country and the epidemic that it is or whether we address these financial services regulatory measures that are more for corporate America than they are for you?

Americans working hard to make ends meet need answers--working hard to get their kids off to school, working hard to make sure they can put food on the table at the end of the day, working hard to ensure that they can put a little money aside for their child's education, working hard to ensure that they can put some retirement money aside.

Footnote there. What are we doing to protect the pensions of people in this country? We are not addressing that. We are addressing big banks.

That they don't have to keep working two or three jobs for the rest of their lives, that is what Americans are looking for.

Well, if they are working hard, then we need to be working hard, and we need to be working hard for them. It is with their interests in mind that we are sent here, and we do a disservice to them and to our country when we abandon that responsibility and consider bills like those put before us today rather than addressing the many, many needs that this country has.

Madam Speaker, I urge a ``no'' vote on the rule, and I yield back the balance of my time.

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