Providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Office of the Comptroller of the Currency relating to "National Banks and Federal Savings Associations as Lenders".

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

Madam Speaker, I rise in strong opposition to this resolution.

Earlier this week, President Biden met with financial regulators. From the four-sentence recap released by the White House, we know one of the topics they discussed was ``promoting financial inclusion and responsibly increasing access to credit.''

I agree with that concept, and I think we should all agree with that concept. Unfortunately, my Democrat colleagues here in the House and the Senate don't seem to be on the same page with the Biden administration. This resolution we are considering today would actually make financial services more expensive and credit less available to consumers and to small businesses and families across the country.

So why are my Democrat colleagues strong-arming this resolution through Congress?

Well, the answer is pretty simple. It is politics. That is what it is. Let's call this what it is. It is blue States and their leftwing, so-called consumer protection advocates who want to, again, limit the reach of national banks and partnerships under the guise of ``consumer protection.''

Democrats are more interested in scoring political points with leftwing activists than supporting the borrowers and small businesses that this OCC True Lender Rule helps.

We have witnessed Democrats work for decades to limit the scope of national banks through one measure or another.

The National Bank Act was signed into law in 1864. We have national banks. We have had national banks for 157 years in this country similar to today. What they are striking at is opposition to what we have lived with for over 157 years of well-regulated national banks doing business across the country.

The left, my colleagues on the opposite side of the aisle, will provide misleading statements about interest rates and spurious arguments about State versus Federal regulation. They will argue consumers are harmed and this so-called partisan rule that they are driving invites bad banking practices.

Above all else, my colleagues across the aisle see this as an opportunity to rebuke the last administration, simply because they don't like the former President. I understand that. There is plenty of debate about that. But we should not tinker with existing law that is longstanding and predates this President or any other President. We should be talking about the contents of that law.

I would like to remind my friends as well that it was the Obama administration who supported the risk-management principles underlying the true lender rule. It was an effort to regulate, to ensure that instead of having shadow banking provide these services, that you have well-regulated consumer protection laws at the Federal level as a part of this process.

So once again, we have the opportunity to come together to support good, bipartisan policy, rather than doing what the Democrats would rather do, which is appease the woke left.

So let's stop the political theatrics and talk about what the true lender rule actually does, not what my Democrat colleagues claim it does.

The rule specifies that when a bank makes a loan, the bank is the true lender if, as of the date of origination, it is named as the lender in the loan agreement or funds the loan. That loan would be regulated by the entity making the loan, funding the loan, and the regulation would fall upon them. So the consumers have Federal consumer protection laws that would act on that loan. That is what it does.

My friends that created the Consumer Protection Bureau, I thought you wanted that, and yet you are arguing against that with this rule today. It is pretty straightforward; it is a pretty straightforward law. It shouldn't be political.

This rule also clarifies that as the true lender of a loan, a bank holds the responsibility of complying with Federal law. This eliminates the greatest risk associated with abuse of rent-a-charter schemes, which we agree are bad, and I think we could be doing something about that rather than this spurious argument we have today.

In October of last year, the OCC finalized the true lender rule that is being debated today. This was a second step in a decades-long process to clarify the bank-third-party relationship when issuing a loan. It has been longstanding practice, but there have been lawsuits, a great deal of uncertainty about it, a lot of questions in particular jurisdictions around the country on the nature of those partnerships, and it clarifies those partnerships in a rules-based regime.

This legal clarity enables bank and fintech partnerships to provide their customers with the financial products they want and need.

Consider this: According to the New York Federal Reserve, one in four African-American-owned firms used fintechs to access PPP loans, one in four. And they did so using this legal doctrine that enabled that to happen in partnerships with national banks.

Technology helps create greater financial inclusion. So why are my Democrat colleagues so afraid of technology, so afraid of innovation?

Per usual, my Democrat colleagues are willing to ignore facts in favor of myths that back up their preferred narrative. That is unfortunate, especially for something this important.

The left likes to say that banks can charge whatever interest rate they want. That is simply not true. Federal law gives national banks and Federal savings associations the same authority that State banks have regarding exportation of interest rates.

Now, both Federal- and State-chartered banks must conform to applicable interest rate limits in those States. States retain the authority to set interest rates, which varies from State to State.

Here is another myth: Third-party bank partnerships will use this rule to skirt State supervision and usury laws. Simply not true.

The truth is, banks primarily partner with third parties to reach additional markets, benefiting from a particular expertise or technology to improve their efficiency. Partnerships with third parties do not change the bank's authority or expose interest rate differentials.

And last, but not least, progressive activists cite the interest rate as a real problem with the true lender rule. They are pushing a 36 percent best rate cap. They have even pushed it at the national level. The math simply doesn't back up this falsehood.

The true lender rule was not some sinister plan by the previous administration to trick borrowers. It was not. It simply was not the case. This legal principle was established in 1864 with the National Bank Act. It is being undermined by an attempt at politics rather than sound policy, and what we should support is good, bipartisan policy that provides clarity to banks and fintechs so they can better serve our constituents and the consumers of America. That is it.

We have a well-regulated banking system. We do. It is not perfect. We have States that have various laws that are operable in their States, but we also have a national system here as well.

We have worked harmoniously, not perfectly, over the last 157 years since we established the national banking system. But why undermine a key principle of that national banking system by spurious arguments that actually don't have to do with the true lender rule? They don't. There are other elements that the left opposes that actually, on a bipartisan basis, we oppose, but the true lender rule is not it.

It is a question of whether or not the bank that is providing you the loan is, in fact, the true lender. That is it. It is not fancier than that, people. That is what it is. That is what we are arguing about today, and that is kind of the absurdity of this stuff that we are debating right now, because it is that simple.

So let's promote financial inclusion the way that the President outlined, which was promoting financial inclusion, making rates more competitive and the cost of credit cheaper for individuals. Let's do that. Let's oppose this resolution before us so we can have sound principles, so we can drive that inclusion that is necessary and very important.

Madam Speaker, I reserve the balance of my time.

Madam Speaker, I yield 3 minutes to the gentleman from Missouri (Mr. Luetkemeyer), who is the ranking member on the Consumer Protection and Financial Institutions Subcommittee of the Financial Services Committee, and also the ranking member on the Small Business Committee.

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

Madam Speaker, I would reference my colleagues the Federal Code, the Federal Register, that actually has the contents of this rule.

Madam Speaker, I include in the Record the actual rule that we are debating here, and I would highlight one piece in particular.

``The OCC agrees that rent-a-charter schemes have no place in the Federal financial system but disagrees that this rule facilitates such schemes. As noted above, instead, this proposal would help solve the problem by (1) providing a clear and simple test for determining when a bank makes a loan and (2) emphasizing the robust supervisory framework that applies to any

loan made by a bank and to all third-party relationships to which banks are a party. As noted above, if a bank fails to satisfy its obligations under this supervisory framework, the OCC will use all the tools at its disposal, including its enforcement authority.''

Madam Speaker, additionally, I would highlight for you that the outline here and the arguments by my colleagues on the other side of the aisle really strikes at the nature of national banking.

So just repeal the National Banking Act rather than trying to undermine it by taking away the legal principle by which a bank can make a loan. That is what this rule does, and that is the absurdity of this debate. That is why I oppose this attempt on the floor today.

Madam Speaker, I yield 2 minutes to the gentleman from Georgia (Mr. Loudermilk), my colleague and friend.

Madam Speaker, I yield 1\1/2\ minutes to the gentleman from Utah (Mr. Moore), a great new Member of the Congress.

Madam Speaker, I yield 3 minutes to the gentleman from Kentucky (Mr. Barr), who is the ranking member on the Subcommittee on National Security, International Development, and Monetary Policy of the Financial Services Committee. He is also a member of the Foreign Affairs Committee.

Madam Speaker, I yield 2 minutes to the gentleman from Florida (Mr. Donalds), who has been a great new Member of Congress.

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

The true lender rule specifies that when a bank makes a loan, the bank is the true lender. The rule clarifies what was uncertain and, therefore, made those loans more expensive.

This gives certainty to the marketplace. It is a good thing. The true lender rule is a good thing.

Under the true lender rule, we have fintechs that have been enabled to make loans in coordination with banks and regulated like the people that they work with, like the banks that they work with, which means the loans fall under Federal consumer protection laws, under Federal usury laws, under Federal laws.

One case in point, what the true lender rule enabled was one out of four African American-owned businesses accessing credit through fintechs.

I would ask Members to review a few pieces of evidence that I have here.

Madam Speaker, I would refer the Members to a study conducted by NYU highlighting the important role that fintechs play in supporting African American-owned small businesses.

I would also refer the Members to letters in opposition to S.J. Res. 15: a June 8 letter from the American Bankers Association, Consumer Bankers Association, Electronic Transactions Association, Independent Bankers of America, Midsize Bank Coalition of America, and National Bankers Association; an April 2, 2021, letter from FreedomWorks, Americans for Tax Reform, National Taxpayers Union, Center for a Free Economy, American Commitment, and Citizens Against Government Waste; a letter from the Structured Finance Association; a letter from the Independent Community Bankers of America; a May 11, 2021, letter from the American Bankers Association; a May 7, 2021, letter from the

Americans for Prosperity; and a June 22, 2021, letter from the Competitive Enterprise Institute, which consists of a number of additional signatories.

None of those people are payday lenders, by the way, which is the most spurious argument about the true lender rule. If you want to get at payday lending, go talk about valid when made. That would be the sound argument from there. At least it has some relationship tangentially to payday lending. True lender does not. These are different loans that are being described by my colleagues across the aisle.

Let's be clear. The National Banking Act enacted in 1864 established the principle by which and explicitly granted national banks the ability to transfer loans State-by-State. If you don't like that model, then repeal the 1864 National Banking Act instead of making these false arguments about the true lender rule, which simply provides clarity about the National Banking Act.

My colleagues across the aisle would have you believe that this is a complex scheme cooked up by the previous administration to get around consumer protection laws. That is not true. We are talking about 157 years of banking law here in the United States, and my colleagues across the aisle are arguing about that.

My Democratic colleagues also ignored this basic fact: They have made misleading statements about national banks versus State banks. They have implied falsehoods on State interest rates. They have cited protecting consumers when now they are just leaving them out to dry. That is not consumer protection.

I get it, Democrats are now so politically motived that the facts and longstanding precedent no longer matter. I think facts matter. In fact, Democrats are so blinded by partisanship, some can't even seem to differentiate between that doctrine of valid when made versus what we are discussing today, which is true lender. I think we should be rooted in fact, and our policy debates should be rooted in fact.

Make no mistake, the true lender rule provides necessary consumer protections and supports affordable credit to more communities. The rule does nothing to change interest rates, plain and simple. States retain that authority.

The actions in 2020 to clarify true lender are very different than codifying and clarifying valid when made. Both were important clarifications, though.

The argument today is about true lender, not some massive shift away from congressional intent, not something new, something longstanding.

Regardless, the Democrats will push through whatever they can in the House today. But as former Acting Comptroller Brooks recently stated, nullifying the true lender rule does nothing to undo payday lending-- nothing. And it seems to be what my colleagues across the aisle have a real problem with.

Deal with that. Don't create needless pain for consumers. Don't drive up the cost of credit and make it less available by repealing this true lender rule.

This is another moment where my colleagues are working against the national banks for politics rather than protecting consumers and creating a more vibrant, competitive, and innovative marketplace.

We should do what is good for consumers in the financial system. Technology and innovation facilitate financial inclusion, which should be our goal.

Let's not waste further time here. Let's vote this idea down that we are debating right now. Let's get back to actually driving a more competitive marketplace and doing what is right for our constituents, what is right for consumers, and what is right for families.

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

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

Madam Speaker, pursuant to House Resolution 486, I call up the joint resolution (S.J. Res. 15) providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by

the Office of the Comptroller of Currency relating to ``National Banks and Federal Savings Associations as Lenders'', and ask for its immediate consideration in the House.

Madam Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks on S.J. Res. 15 and to insert extraneous material thereon.

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

Madam Speaker, I rise today in support of S.J. Res. 15, a resolution to invalidate the Office of the Comptroller of the Currency's so-called True Lender Rule under the Congressional Review Act.

This resolution would end a dangerous Trump-era rule that would allow predatory lenders to evade State usury laws and target consumers with high interest rate loans of 150 percent or higher through sham partnerships with banks.

I would like to thank Representative Garcia from Illinois for introducing the House companion to this measure and for his leadership in fighting to protect consumers from predatory lending schemes.

My committee has held several hearings that have exposed the consumer harm that results from these rent-a-bank schemes and explored how the Trump administration's harmful rule erodes the consumer protections.

The OCC's rule undoes centuries of case law that ensured that nonbank financial institutions were subject to State interest rate caps when they partnered with banks, so long as they held the primary economic interest in a consumer loan.

Trump's OCC allowed nonbanks to launder their loans through OCC- chartered banks, as long as the bank is listed on the loan origination documents, effectively allowing nonbanks to ignore State usury laws.

Simply put, before this Trump-era rule was finalized, if a nonbank in California, which has an interest rate cap of, for example, 36 percent, wanted to make a loan to a customer in California, the nonbank can't charge more than 36 percent. OCC's True Lender Rule turns this commonsense legal doctrine on its head.

What the Trump-era rule says is that this nonbank can now partner with a national bank that is based in, for example, Utah, which doesn't have an interest rate cap, to now legally charge virtually any interest rate to the consumers in California.

This is true even if the bank in Utah has done nothing but put its name on the loan paperwork and intends to immediately transfer the loan to the nonbank in California. We have seen interest rates of more than 150 percent charged to consumers in this way.

The committee's work has shone a spotlight on heartbreaking stories of the harm that this rule has caused to consumers and small business owners. Let me give you a real-world example of a Black-owned small business that was harmed by one of these rent-a-bank schemes authorized by Trump's OCC.

A recent news report detailed the case of Carlos and Markisha Swepson, who were the owners of Boulevard Bistro, a restaurant in Harlem, New York. As they told NBC News, they took out several business loans for $67,000 and were charged a whopping 268 percent APR.

For all intents and purposes, their lender was World Business Lenders, a nonbank lender that has a partnership with Axos Bank. This is a bank in New York State. Even though the loan was made by World Business Lenders, because Axos Bank's name was on the loan documents, the nonbank could bypass the New York usury limit of 25 percent APR.

Due to the pandemic, the Swepsons are now behind on their loan payments. They are now facing foreclosure proceedings filed by World Business Lenders on a home they own that acts as collateral for the high interest rate loans. If not for Trump's rule, the Swepsons would have only been charged a 25 percent interest rate and would probably not be facing financial ruin.

If Congress lets this Trump-era rule stand, these kinds of predatory, triple-digit interest rate loans will continue to be made through these kinds of rent-a-bank schemes, and lenders will continue to take advantage of small business owners and other consumers desperate to stay afloat.

Additionally, let's not forget that during the last election, Nebraska joined 45 States and the District of Columbia that have already passed legislation to limit usury rates for small-dollar installment loans.

The Trump-era True Lender Rule is a backdoor way for nonbanks to charge triple-digit interest rates on loans at the expense of consumers in States where voters turned out to pass interest rate cap laws.

No wonder some called this the ``fake lender'' rule.

For these reasons, I urge my colleagues to support this bill. And for those who did not understand what we were talking about when we talked about the True Lender Rule, I think I have laid it out in such a way that you understand this is predatory. This is a rip-off. And for these reasons, I urge my colleagues to support this bill.

Madam Speaker, I reserve the balance of my time.

Madam Speaker, I yield 1 minute to the gentlewoman from California (Ms. Pelosi), the Speaker of the House of Representatives.

Madam Speaker, I yield 2 minutes to the gentleman from Illinois (Mr. Garcia), who is also the sponsor of the House companion to this legislation.

Madam Speaker, I yield 2 minutes to the distinguished gentlewoman from Michigan (Ms. Tlaib).

Madam Speaker, I yield 2 minutes to the gentleman from Texas (Mr. Green), who is also the chair of the Subcommittee on Oversight and Investigations.

Madam Speaker, I yield 1 minute to the gentlewoman from California (Ms. Porter).

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

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

Madam Speaker, this resolution would take the necessary action to reverse the harmful Trump-era true lender rule that preys on small business owners and individuals when they need assistance the most. This rule is a back door for nonbanks to charge triple digit interest rates that trap consumers.

Last month, the Senate passed this resolution on a bipartisan vote with all Democrats voting in support. They were joined by Republican Senators Lummis, Rubio, and Collins. This resolution is also supported by more than 400 consumer, civil rights, veterans, small businesses, and other organizations, including the American Civil Liberties Union, Americans for Financial Reform, the Center for Responsible Lending, Faith for Just Lending, the NAACP, National Association of Federally- Insured Credit Unions, the National Consumer Law Center, Conference of State Bank Supervisors, and 25 State attorneys general from both red and blue States, among many others.

Madam Speaker, and Members, small businesses and underbanked consumers do not benefit from the rule. Instead, the rule allows nonbank lenders to launder loans through banks in order to charge those with limited access to credit triple digit interest rates and trap these consumers in devastating cycles of debt. These predatory rent-a- bank schemes disproportionately prey on communities of color, draining wealth from these communities and, in turn, perpetuating the racial wealth gap.

A disproportionate share of payday borrowers come from communities of color even after controlling for income. Communities of color have historically been left out of the banking system. Black and Latinx consumers are much less likely to have a checking account than White consumers, which is typically a requirement for a payday loan. About 17 percent of Black and 14 percent of Latinx households are unbanked compared to 3 percent of White households.

Payday lenders target communities of color. The communities most affected by redlining are the same who are saturated by payday lenders today, which are more likely to locate in more affluent communities of color than in less affluent White communities.

One borrower, a single mother living below the poverty line from California, submitted a complaint to the CFPB about Elevate's RISE.

``I was misled by RISE Credit to believe that they were unlike other predatory loan companies. By the time,'' she says, ``I understood what I had signed, I had paid them thousands of dollars in interest.

``I have recently become temporarily unemployed and called them to ask for help during my time of financial hardship. They refused any solution and my account is headed to collections now.

``The total paid is far over the amount initially borrowed from RISE. This is robbery, and all of the necessities I have for myself and my children are suffering because of it.

``How is it that they can do this? I am asking for help for not only my family, but for all of the families targeted by these predatory loans meant to target those living in poverty and struggling to live paycheck to paycheck.''

The fake lender rule protects lenders that not only destroy small businesses but also threaten to take business owners' homes.

In New York, Jacob Adoni, a realtor, has been facing foreclosure threats on a $90,000 loan with an interest rate of 138 percent APR.

In a court case--that is Adoni et al. v. World Business Lenders, LLC, Axos Bank and Circadian Funding filed in New York in October 2019-- Adoni said he received threats that the lender would foreclose on his home after receiving a $90,000 loan at 138 percent APR, secured by his personal residence.

``Adoni was contacted by Circadian Funding with an offer of a personal loan that would be funded by WLB and Axos Bank. He was told that the loan documents would be provided to him at 12 p.m. and he must execute them by 6 p.m. or the offer would no longer be valid.

``Adoni was told by Circadian that the loan was meant to be a personal loan to him, but it was necessary for the loan documents to make reference to his business.''

He has received multiple threats to foreclose on his home and the mortgage.

Madam Speaker, let me just respond to some of what I have heard from the opposite side of the aisle. I am absolutely overcome by the great interest that my Republican colleagues have in helping minorities. I am so moved about the fact that all this is about helping minorities who have been put into trouble because they are subprime lenders. Now if they are, it is because they were the victim of predatory lenders who put them in a subprime position.

But I hardly think that this is all about taking care of minorities and these small businesses. This is about protecting the big banks. This is about protecting the national banks. You heard what the ranking member said. The big national banks have been in business for years, and we ought to let them operate the way that they have historically operated and not interfere with them.

I don't know where they get away with protecting these big national banks. And the constituents in their own district who are being misused because they happen to get money, money that was lent to them by a nonbank, and that nonbank partnered with a national bank, they are now having to pay the interest rates of another State, perhaps--like it was explained in California, why we have usury laws and there is a cap on those interest rates.

When they do this kind of partnering, it is all about getting to a State where they are made to pay whatever that big bank is allowed to collect from them.

Madam Speaker, this is a rip-off. This is about hurting the people who most need our help. This is about allowing this partnering to go on. And many of those people who are borrowing from these payday lenders and other nonbanks don't even know that they are going to be the victims of the big banks and the interest rates that they charge. This is absolutely ridiculous, and there is not a credible argument from the other side of the aisle about why they should disadvantage these minorities and small businesses that they claim that they are protecting. This is outrageous.

Madam Speaker, I am so pleased that the Senate passed this bill. And I am so pleased that the Republicans on the other side of the aisle-- not on the other side of the aisle, on the other side of Congress-- decided to join with the Democrats in order to do the right thing on behalf of our constituents.

Madam Speaker, when they talk about, Oh, this is just because they didn't like Trump and they want to undo whatever he has done, that is their talking point for the day. This is not about that.

This committee, the Committee on Financial Services, is a new and different kind of committee. We are not owned by the banks. We are not here to protect the big banks and the national banks. We are here because we are here to take care of what is right and what is fair. And this committee is not going to be about the business of ripping off the least of these.

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

Madam Speaker, I rise today also in opposition to S.J. Resolution 15, the Congressional Review Act repeal of the Office of the Comptroller of the Currency's true lender rule.

The United States has the most vibrant and innovative financial system in the world. Recent advancements in technology have fostered products and partnerships that expand access to credit to large swaths of the population that previously couldn't access basic financial services.

Many of these innovations faced challenges from regulatory red tape or confusing and often conflicting rules. The OCC's true lender rule gave needed clarity to banks and their partners, fixing the disastrous Madden rule.

The OCC's true lender rule gave that clarity, but unfortunately, the effort in the House today threatens to undermine the progress that we have made and compromise underbanked individuals' and small businesses' access to financial services.

I spoke with a local Kentucky bank that partners with a nonbank fintech lender to provide credit to consumers, including many underbanked populations. They told me that absent the true lender rule, they will once again be buried in compliance costs to keep track of the patchwork of cases that dictate the rules of the road.

Rather than embrace innovation to deliver cost savings to their customers, many of whom have trouble accessing traditional financial services to begin with, the bank will need to retain thousand-dollar- an-hour New York lawyers just to keep everything straight. And guess what? Those costs get passed on to the consumer through higher prices or reduced product availability.

This is yet another example of the Democrats sacrificing good policy for the sake of political points, all under the guise of consumer protection.

Contrary to some of the rhetoric from my colleagues on the other side of the aisle, a vote for this CRA will actually harm the very people they purport to be helping.

Madam Speaker, one final point. I include in the Record an April 14, 2021, letter to the chair of the Financial Services Committee from the former OCC Acting Comptroller Blake Paulson.

Office of the Comptroller

of the Currency,

Washington, DC, April 14, 2021.

Hon. Maxine Waters,

Chairwoman, Committee on Financial Services, House of

Representatives, Washington, DC.

Hon. Patrick McHenry,

Ranking Member, Committee on Financial Services, House of

Representatives, Washington, DC.

Dear Chairwoman Waters and Ranking Member McHenry: On March

26, 2021, H.J. Res. 35 was introduced, providing for

Congressional disapproval under the Congressional Review Act

of the Office of the Comptroller of the Currency's (OCC)

final rule, entitled ``National Banks and Federal Savings

Associations as Lenders,'' commonly referred to as the ``True

Lender'' rule. As you and other members consider the

resolution, I want you to be aware of the rule's intended

effect and the adverse impact of overturning the rule.

On October 27, 2020, the OCC issued its final true lender

rule to provide legal and regulatory certainty to national

banks' and federal savings associations' (banks) lending,

including loans made in partnerships with third parties. The

OCC's rule specifies that a bank makes a loan and is

considered to be the true lender of the loan if, as of the

date of origination, it (1) is named as the lender in the

loan agreement or (2) funds the loan. The rule clarifies that

as the true lender of a loan, the bank retains the compliance

obligations associated with making the loan, even if the loan

is later sold, thus negating concerns regarding harmful rent-

a-charter arrangements. Our rulemaking prevents potential

arrangements in which a bank receives a fee to ``rent'' its

charter and unique legal status to a third party with the

intent of evading state and local laws, while disclaiming any

compliance responsibility for the loan. These schemes have

absolutely no place in the federal banking system, and this

rule helps address them.

The rule makes clear banks' responsibility and

accountability for the loans they make and facilitates the

OCC's supervision of this core banking activity. Disapproval

of the rule would return bank lending relationships to the

previous state of legal and regulatory uncertainty, which, as

nearly 50 preeminent economic and finance scholars explained

in January 2021, adversely affects the function of secondary

markets and restricts the availability of credit.

Legal and regulatory certainty facilitates access to

responsible credit and clarifies responsibility and

accountability in lending involving third-party partnerships.

Bank third-party partnerships help banks better serve their

communities by expanding access to affordable credit products

from mainstream financial service providers. Such access is

particularly important as individuals and small businesses

across the country work to recover from effects of the COVID-

19 pandemic. Banks seek partnerships with third parties for a

variety of legitimate reasons, including reaching additional

markets, benefiting from specific expertise or technology,

and improving the efficiency and cost of their own

operations. The OCC's third-party risk management guidance

and supplemental exam procedures make clear to banks that

they retain the risks for activities conducted through

relationships with third parties.

With the legal and regulatory certainty provided by the

rule, lending by banks made in partnership with third parties

can be assessed as part of the ongoing supervision of these

banks, including as part of the OCC's examinations to

evaluate bank compliance with applicable laws and regulations

that ensure consumer protection, Bank Secrecy Act and anti-

money laundering compliance, required disclosures, and other

obligations associated with making loans. The OCC clarified

examiner responsibilities in assessing true lender activities

in third-party relationships in 202l. This clarification

addressed considerations related to assessing banks' due

diligence on the lending product or activity (e.g., terms and

scope) and the third party; credit risk management, including

underwriting practices; model risk management; compliance

management systems; and ongoing monitoring of the lending

activity and the third party's performance.

If a bank fails to satisfy any of its compliance

obligations, the OCC will not hesitate to use its supervisory

and enforcement authorities to correct the deficiencies,

protect consumers, and ensure the federal banking system

operates in a safe, sound, and fair manner.

As you consider the Congressional Review Act resolution,

you should be confident that the OCC issued this rule with

the intent to enhance its ability to supervise bank lending.

The rulemaking conformed to the Administrative Procedure Act,

and the agency considered all stakeholder comments provided

during the rulemaking process. The resulting rule is

consistent with the authority granted to the agency by

Congress.

It is also important to dispel misperceptions of the rule,

many of which are repeated by opponents of the rule. To be

clear, the rule does not change banks' authority to export

interest rates. That authority is granted by federal statute.

Nor does the rule permit national banks to charge whatever

rate they like; national banks and federal savings

associations have the same authority as state banks regarding

the exportation of interest rates. Both federal and state-

chartered banks must conform to applicable interest rate

limits. Disparities of interest rates from state to state

result from differences in the state laws that impose these

caps, not OCC rules or actions. States retain the authority

to set interest rates, and rates vary from state-to-state.

The rule does not limit states' ability to regulate the

conduct of state-licensed and regulated nonbank lenders,

which engage in the vast majority of predatory lending.

States are the primary regulators of nonbank lenders,

including payday lenders. Nonbank lenders are generally also

subject to the rules and enforcement actions of the Consumer

Financial Protection Bureau (CFPB).

It is also important to understand why demand exists for

short-term, small-dollar credit products and why many

consumers rely on nonbank sources of such credit, including

payday lenders. Unfortunately, mainstream service providers,

including commercial banks, largely abandoned short-term

small-dolJar lending over the past two decades. The resulting

lack of choice and fewer options pushed up the cost of these

products and forced consumers to seek services on less

favorable terms. Because millions of U.S. consumers do not

have sufficient savings or access to traditional credit, they

borrow nearly $90 billion each year in short-term small-

dollar loans typically ranging from $300 to $5,000 to make

ends meet and to address things like emergency car repairs

and other unexpected expenses. That is why the OCC has

remained vocal about encouraging banks to provide consumers

with more safe and affordable options to meet these small-

dollar needs. In providing these products, banks should

consider the ``Interagency Lending Principles for Offering

Responsible Small-Dollar Loans,'' published in May 2020.

Banks should also consider the full and actual cost of a

credit product and its affordability. Fees associated with

short-term loans may range from $10 to $30 per $100 borrowed,

and the imputed annual percentage rate (APR) of those loans

can appear to exceed 100 percent or more. But often, the fees

and total cost of these loans to the consumer can be less

than that of loans made with a 36 percent APR, when such

loans are available at all.

As you consider the Congressional Review Act resolution,

please keep in mind what may be an unintended consequence of

a Congressional Review Act disapproval. Disapproving the

OCC's true lender rule will constrain future Comptroller

ability to address the true lender issue and may limit the

OCC's ability to take supervisory or enforcement actions

against banks that would have been deemed to have ``made''

the loan under the true lender rule. Rather than vacate the

rule, limit future Comptrollers from taking up similar rules

or possibly hamstring the OCC's enforcement authority,

changes to the rule, if any, should be made through the

agency's rulemaking process and in accordance with the

Administrative Procedures Act.

Enclosed is a fact sheet that provides additional

information for your awareness. If you have any questions or

need additional information, please do not hesitate to

contact me or Carrie Moore, Director, Congressional

Relations.

Sincerely,

Blake J. Paulson,

Acting Comptroller of the Currency.

The point I want to highlight is that the former Acting Comptroller was making the point that disapproving the OCC's true lender rule will constrain a future Comptroller's ability to address the true lender issue and limit the OCC's ability to take supervisory or enforcement actions against banks that would have been deemed to have made the loan under the true lender rule; meaning that the way the CRA law operates, if the House passes this resolution, we will have a permanent problem in the credit markets that will deprive low- and moderate-income Americans of the financial products that they desperately need.

That is why I urge all my colleagues to reject this misguided proposal.

Madam Speaker, I thank the gentlewoman for her leadership in bringing this important legislation, more than one piece of legislation, to the floor today.

As I rise to speak in support of reversing the anti-consumer fake lender rule pushed through in the final weeks of the previous administration, I just want to take a moment to put it in perspective.

Madam Speaker, in November, the people elected Democratic majorities in the Congress that would be for the people, fighting for the public interests, not the special interests.

To that end, they elected majorities that would reverse the damage inflicted on their health and financial security by the last administration.

That mission is why the House this week is passing legislation under the Congressional Review Act to reverse three of the past President's most egregious assaults on families' well-being.

The Congressional Review Act is one of Congress' most important tools to reassert the power of the people's House to deliver for the people and to reclaim our authority under the Constitution, upholding the balance of powers that is the foundation of our American democracy.

With the gentlewoman's permission, I wish to speak to the anti- consumer fake lender rule, but also speak to two other issues under the Congressional Review Act this afternoon.

On the floor today is legislation, again, to reverse the anti- consumer fake lender rule pushed through in the final weeks of the previous administration.

This fake lender rule greenlights rent-a-bank schemes in which predatory lenders evade bank interest rate limits to swindle vulnerable consumers. This is done by putting a bank

name on loan paperwork and claiming that the bank, not the predatory lender, issued the loan.

To take one example, in California, where the interest rate on a 2- year $2,000 loan is capped at 25 percent, lenders can use rent-a-bank partnerships to make loans with rates up to 225 percent.

This bipartisan resolution to end the fake lender rule is supported by many: a bipartisan coalition of 25 State attorneys general; faith leaders, including the National Latino Evangelical Coalition, the National Association of Evangelicals, the National Baptist Convention USA, hundreds of banking law and consumer finance regulation scholars, and Americans across the country and across parties, urging us to support this Congressional Review Act reversal of the anti-consumer fake lender rule.

Also today, we are considering legislation to undo the antiworker, pro-discrimination rule forced through in the final week of the past administration.

The EEOC was established to protect working people from discrimination and ensure that discrimination charges are resolved fairly. But this rule would impose draconian new obligations that bias the conciliation process against employees, toward employers; escalate the potential for retaliation, because retaliation claims make up half of EEOC's charges filed at the EEOC last year; siphon off scarce EEOC resources and saddle the EEOC with wasteful collateral litigation, prolonging harm to workers through delays; and contravene both the Supreme Court precedent and Congressional intent.

This month, civil rights and workers' rights organizations wrote to Congress in support of S.J. Res. 13, writing: ``The EEOC must be able to conduct its work efficiently . . . to prevent and remedy workplace discrimination.

``This mission is even more critical in the middle of a global pandemic that continues to have severe economic repercussions for women, people of color, and other marginalized communities.

``The final rule will only deepen the barriers working people face coming forward to report discrimination and obtain justice.''

This Congressional Review Act legislation passed the Senate. Hopefully, it will pass the House today.

Finally, tomorrow we take up bipartisan legislation that paves the way to restore the Obama-era protections against harmful methane pollution, which the most recent past President rolled back.

Briefly, these safeguards are key protections for public health that will also make a serious difference in combating the climate crisis. Methane is responsible for at least one-quarter of the warming of the planet. And it is 25 times more potent than carbon dioxide in trapping heat in the atmosphere.

This resolution passed on a bipartisan basis in the Senate and in the Energy and Commerce Committee. It builds on the commitment of the President and the Democratic Congress to tackle the climate crisis.

As the administration has stated, addressing methane pollution is an urgent and essential step.

Madam Speaker, with that, as Speaker, I am proud to be able to use the Speaker's prerogative to speak beyond the item on the floor right now.

I am proud to support these important actions to reverse the Trump damage and to deliver results that make a difference in the lives of hardworking American families.

I thank all of our leaders for this legislation for the people: Chair Bobby Scott and Representative Suzanne Bonamici on the EEOC resolution; Representative Chuy Garcia for his work on the true lender resolution; Representative Diana DeGette and Chairman Frank Pallone, and many others, on the methane resolution from the Energy and Commerce Committee.

I urge strong votes for S.J. Res. 13, 14, and 15.

Coming back to the resolution on the floor right now, I thank the distinguished chair of the Financial Services Committee for her leadership in looking out always for the consumer, for competition, for fairness, for the people.

Madam Speaker, I thank the gentleman for yielding to allow me to speak on this matter.

It is important to understand, Madam Speaker, that having access to financial products is critical for not only the innovation of our markets but for the future expansion of our markets. It is time to take the pettiness out of politics and actually prioritize policy that puts Americans first and puts America first.

True lender is not being discussed in a way that considers people. If that were the case, we would be recognizing the incredible ways it has spurred innovation in our markets and has provided more access to credit and other financial products for Americans.

Instead of Congress working together to create financial equity in a sustainable way or ensuring that the United States remains a global leader, Democrats are working to undo anything accomplished under the Trump administration, even if it means sacrificing the good of the people.

I support assessing harmful financial policies of the past and working to undo some of the mistakes that have been made. In fact, we could benefit from assessing legislation like Dodd-Frank, which has put tremendous downward pressure on community banks being formed in the United States. But that is not what is being done here.

We are not having honest conversations. My peers across the aisle are undoing good policy without an objective view to determine how it helps or hurts Americans.

Fintech has played a significant role in transforming our markets, helping smaller banks become more competitive, and creating more products and access for Americans. The true lender rule has supported that because it clarifies the legal framework that allows these bank and nonbank partnerships to be successful for consumers.

We should be prioritizing fair access to financial services for Americans and work to protect and promote innovation in our markets so that consumers have as many pathways as possible to prosperity and achieving the American Dream.

If we scrap the true lender rule, we will disrupt our market, stifle innovation, and hinder access to accountable and affordable credit for consumers and small businesses. This is not the precedent we should set in this body. It is a gross abuse of power and a knife in the back of consumers.