{ "id": "IN10950", "type": "CRS Insight", "typeId": "INSIGHTS", "number": "IN10950", "active": true, "source": "EveryCRSReport.com", "versions": [ { "source": "EveryCRSReport.com", "id": 587935, "date": "2018-11-27", "retrieved": "2018-11-28T14:45:03.092839", "title": "Financial Services and General Government (FSGG) FY2019 Appropriations and Financial Regulatory Reform", "summary": "Background\nOn July 19, 2018, the House passed H.R. 6147, which included an FY2019 Financial Services and General Government (FSGG) appropriations bill (originally H.R. 6258) as Division B. The Senate passed a substitute version of H.R. 6147 on August 1, 2018, with the Senate FY2019 FSGG bill (originally S. 3107) as Division B. No full-year FY2019 FSGG bill was enacted prior to the end of FY2018. The FSGG agencies were provided continuing appropriations until December 7, 2018, in Division C of P.L. 115-245.\nAlthough financial services are a focus of the FSGG bill, the bill does not include funding for most of the financial service regulators. Instead, this funding comes through a variety of sources, including fees or assessments on regulated institutions. (See CRS Report R43391, Independence of Federal Financial Regulators: Structure, Funding, and Other Issues.)\nFederal regulation of the banking industry is divided among the Federal Reserve, the Federal Deposit Insurance Corporation (FDIC), the Office of Comptroller of the Currency (OCC), and the Bureau of Consumer Financial Protection (CFPB or BCFP). Credit unions are regulated by the National Credit Union Administration (NCUA), and the housing government-sponsored enterprises are regulated by the Federal Housing Finance Agency (FHFA). None of these agencies receive their primary funding through the appropriations process.\nFederal securities regulation is divided between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), both of which are funded through appropriations bills. CFTC funding is appropriated from the general fund, whereas the SEC funding is offset through fees collected by the SEC. \nFSGG Financial Regulatory Legislative Provisions\nAlthough most funding is not provided by the FSGG bill, legislative provisions affecting financial regulation in general and some financial regulatory agencies specifically have often been included in past FSGG bills.\nMost of the provisions in Title IX of the House-passed FSGG bill (H.R. 6258/H.R. 6147, Division B) are similar or identical to provisions in other legislation that has passed the House both individually and as part of broader bills, particularly the Financial CHOICE Act (H.R. 10) and the JOBS and Investor Confidence Act of 2018 (S. 488 as amended by the House). Some of these provisions would amend the 2010 Dodd-Frank Act. The Senate FSGG bill (S. 3167/H.R. 6147, Division B) does not contain similar legislative provisions. \nTable 1 contains a full listing of sections from the House-passed FSGG bill Title IX and similar sections of H.R. 10, S. 488, and other individual legislation. Selected policy changes in the House-passed FSGG bill include the following:\nCapital formation. Some policymakers have concluded that changes in market trends require updated regulations governing capital access to securities markets, particularly for small- to medium-sized companies. The provisions in the FSGG bill generally aim to expand investor access to securities markets, reduce compliance costs, and promote financial intermediation. S. 488, much of which is contained in the FSGG bill, passed the House with close to unanimous support.\nCFPB structure. The Dodd-Frank Act created the CFPB with structural features that made it more independent than most other agencies. Congress has debated whether the current structure strikes the right balance between the desire for agency independence and accountability to Congress and the Administration. Title IX would reduce the CFPB\u2019s independence by placing the CFPB under congressional appropriations, requiring congressional approval of \u201cmajor rules\u201d issued by the CFPB, and allowing the President to replace the head of the CFPB at will, in lieu of the current \u201cfor cause\u201d removal, among other changes.\nEnhanced regulation. The Dodd-Frank Act created a new enhanced prudential regulatory regime for large banks and nonbank financial firms designated as systemically important. Title IX would modify the regime\u2019s nonbank designation process, reduce the frequency of \u201cliving wills,\u201d and eliminate nonbank stress test requirements, among other changes.\n\n\nTable 1. Financial Regulatory Provisions in the House-Passed FSGG Bill \nand Other Legislation\nTopic\nHouse-Passed H.R. 6147, Division B, Title IX \nH.R. 10 \nS. 488\nIndividual Legislation\n\nAllows general solicitation for angel investors\nSubtitle A\nSection 452\nTitle I\nH.R. 79\nExpands information used in credit reportingSubtitle B\u2014Title IIH.R. 435\nSmall M&A broker exemptionSubtitle CSection 401Title IIIH.R. 477\nTreatment of points and fees in mortgage regulation\nSubtitle D\nSection 506\n\u2014\nH.R. 1153 \nAccredited investor definitionSubtitle ESection 860Title IVH.R. 1585\nExpand audit attestation requirement (SOX 404b) exemptionSubtitle FSection 441Title VH.R. 1645\nEnd banking for human traffickersSubtitle G\u2014Title XXIIIH.R. 6069\nSmall Business Investment Company funding accessSubtitle H\u2014Title VIIH.R. 2364\nExtends annual privacy notification exemption to auto financing companiesSubtitle I\u2014\u2014H.R. 2396\nLimits on deposit account terminationsSubtitle JSection 511\u2014H.R. 2706\nExpands investor outreach during IPO processSubtitle KSection 499Title IXH.R. 3903\nGreater flexibility on rating agency examsSubtitle LSection 851\u2014H.R. 3911 \nSEC subpoena required for source code disclosureSubtitle MSection 816\u2014H.R. 3948\nFamily offices deemed accredited investors Subtitle N\u2014Title XH.R. 3972\nSEC consolidated audit trail data protectionSubtitle OSection 813\u2014H.R. 3973\nChanges to nonbank systemically important designation process\nSubtitle P\n\u2014\n\u2014\nH.R. 4061\nSEC study of small rural business capital accessSubtitle Q\u2014Title XIH.R. 4281\nFed-only jurisdiction over Volcker RuleSubtitle R\u2014\u2014H.R. 4790 \nReduced frequency of living will requirement for large banksSubtitle SSection 151Title XIIH.R. 4292\nBank exam appeals expandedSubtitle TSection 536\u2014H.R. 4545\nChanges to mortgage settlement statementSubtitle U\u2014\u2014H.R. 3978\nDelays credit union capital ruleSubtitle V\u2014Title XVIIH.R. 5288\nCreates dedicated CFPB Inspector GeneralSubtitle WSection 713\u2014H.R. 3625\nCFPB under appropriationsSubtitle XSection 712\u2014\u2014\nNonbank stress test repealSubtitle Y\u2014Title XVH.R. 4566\nSwaps margin exemption for interaffiliates Subtitle Z\u2014\u2014\u2014\nRequires consistency in enhanced regulationSubtitle AA\u2014\u2014\u2014\nEliminates \u201cfor cause\u201d removal protection for CFPB DirectorSubtitle BBSection 711(a)(1)(D)\u2014\u2014\nCongressional approval for \u201cmajor\u201d CFPB rules Subtitle CCTitle III, Subtitle Ba\n\u2014\nH.R. 26a\n\nSource: Congressional Research Service.\nNotes: M&A=Mergers and Acquisitions; SOX= Sarbanes Oxley Act (P.L. 107-204); IPO=Initial Public Offering.\nThese bills would require congressional approval of major rules for other agencies as well.", "type": "CRS Insight", "typeId": "INSIGHTS", "active": true, "formats": [ { "format": "HTML", "encoding": "utf-8", "url": "http://www.crs.gov/Reports/IN10950", "sha1": "26aecb6a17d6a9c2895a79b40697fac9de4340bd", "filename": "files/20181127_IN10950_26aecb6a17d6a9c2895a79b40697fac9de4340bd.html", "images": {} } ], "topics": [] }, { "source": "EveryCRSReport.com", "id": 583657, "date": "2018-08-07", "retrieved": "2018-08-09T13:38:48.507895", "title": "Financial Services and General Government (FSGG) FY2019 Appropriations and Financial Regulatory Reform", "summary": "Background\nOn July 19, 2018, the House passed H.R. 6147, which included an FY2019 Financial Services and General Government (FSGG) appropriations bill (originally H.R. 6258) as Division B. The Senate passed a substitute version of H.R. 6147 on August 1, 2018, with the Senate FY2019 FSGG bill (originally S. 3107) as Division B.\nAlthough financial services are a focus of the FSGG bill, the bill does not include funding for most of the financial service regulators. Instead, this funding comes through a variety of sources, including fees or assessments on regulated institutions. (See CRS Report R43391, Independence of Federal Financial Regulators: Structure, Funding, and Other Issues.)\nFederal regulation of the banking industry is divided among the Federal Reserve, the Federal Deposit Insurance Corporation (FDIC), the Office of Comptroller of the Currency (OCC), and the Bureau of Consumer Financial Protection (CFPB or BCFP). Credit unions are regulated by the National Credit Union Administration (NCUA), and the housing government-sponsored enterprises are regulated by the Federal Housing Finance Agency (FHFA). None of these agencies receive their primary funding through the appropriations process.\nFederal securities regulation is divided between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), both of which are funded through appropriations bills. CFTC funding is appropriated from the general fund, whereas the SEC funding is offset through fees collected by the SEC. \nFSGG Financial Regulatory Legislative Provisions\nAlthough most funding is not provided by the FSGG bill, legislative provisions affecting financial regulation in general and some financial regulatory agencies specifically have often been included in past FSGG bills.\nMost of the provisions in Title IX of the House-passed FSGG bill (H.R. 6258/H.R. 6147, Division B) are similar or identical to provisions in other legislation that has passed the House both individually and as part of broader bills, particularly the Financial CHOICE Act (H.R. 10) and the JOBS and Investor Confidence Act of 2018 (S. 488 as amended by the House). Some of these provisions would amend the 2010 Dodd-Frank Act. The Senate FSGG bill (S. 3167/H.R. 6147, Division B) does not contain similar legislative provisions. \nTable 1 contains a full listing of sections from the House-passed FSGG bill Title IX and similar sections of H.R. 10, S. 488, and other individual legislation. Selected policy changes in the House-passed FSGG bill include the following:\nCapital formation. Some policymakers have concluded that changes in market trends require updated regulations governing capital access to securities markets, particularly for small- to medium-sized companies. The provisions in the FSGG bill generally aim to expand investor access to securities markets, reduce compliance costs, and promote financial intermediation. S. 488, much of which is contained in the FSGG bill, passed the House with close to unanimous support.\nCFPB structure. The Dodd-Frank Act created the CFPB with structural features that made it more independent than most other agencies. Congress has debated whether the current structure strikes the right balance between the desire for agency independence and accountability to Congress and the Administration. Title IX would reduce the CFPB\u2019s independence by placing the CFPB under congressional appropriations, requiring congressional approval of \u201cmajor rules\u201d issued by the CFPB, and allowing the President to replace the head of the CFPB at will, in lieu of the current \u201cfor cause\u201d removal, among other changes.\nEnhanced regulation. The Dodd-Frank Act created a new enhanced prudential regulatory regime for large banks and nonbank financial firms designated as systemically important. Title IX would modify the regime\u2019s nonbank designation process, reduce the frequency of \u201cliving wills,\u201d and eliminate nonbank stress test requirements, among other changes.\n\n\nTable 1. Financial Regulatory Provisions in the House-Passed FSGG Bill \nand Other Legislation\nTopic\nHouse-passed H.R. 6147, Division B, Title IX H.R. 10S. 488Individual Legislation\nAllows general solicitation for angel investorsSubtitle ASection 452Title IH.R.79\n\nExpands information used in credit reporting\nSubtitle B\n\u2014\nTitle II\nH.R.435\n\nSmall M&A broker exemption\nSubtitle C\nSection 401\nTitle III\nH.R.477\n\nTreatment of points and fees in mortgage regulation\nSubtitle D\nSection 506\n\u2014\nH.R.1153 \n\nAccredited investor definition\nSubtitle E\nSection 860\nTitle IV\nH.R.1585\n\nExpand audit attestation requirement (SOX 404b) exemption\nSubtitle F\nSection 441\nTitle V\nH.R.1645\n\nEnd banking for human traffickers\nSubtitle G\n\u2014\nTitle XXIII\nH.R.6069\n\nSmall Business Investment Company funding access\nSubtitle H\n\u2014\nTitle VII\nH.R.2364\n\nExtends annual privacy notification exemption to auto financing companies\nSubtitle I\n\u2014\n\u2014\nH.R.2396\n\nLimits on deposit account terminations\nSubtitle J\nSection 511\n\u2014\nH.R.2706\n\nExpands investor outreach during IPO process\nSubtitle K\nSection 499\nTitle IX\nH.R.3903\n\nGreater flexibility on rating agency exams\nSubtitle L\nSection 851\n\u2014\nH.R.3911 \n\nSEC subpoena required for source code disclosure\nSubtitle M\nSection 816\n\u2014\nH.R.3948\n\nFamily offices deemed accredited investors \nSubtitle N\n\u2014\nTitle X\nH.R.3972\n\nSEC consolidated audit trail data protection\nSubtitle O\nSection 813\n\u2014\nH.R.3973\n\nChanges to nonbank systemically important designation process\nSubtitle P\n\u2014\n\u2014\nH.R. 4061\n\nSEC study of small rural business capital access\nSubtitle Q\n\u2014\nTitle XI\nH.R.4281\n\nFed-only jurisdiction over Volcker Rule\nSubtitle R\n\u2014\n\u2014\nH.R.4790 \n\nReduced frequency of living will requirement for large banks\nSubtitle S\nSection 151\nTitle XII\nH.R.4292\n\nBank exam appeals expanded\nSubtitle T\nSection 536\n\u2014\nH.R.4545\n\nChanges to mortgage settlement statement\nSubtitle U\n\u2014\n\u2014\nH.R.3978\n\nDelays credit union capital rule\nSubtitle V\n\u2014\nTitle XVII\nH.R.5288\n\nCreates dedicated CFPB Inspector General\nSubtitle W\nSection 713\n\u2014\nH.R. 3625\nCFPB under appropriationsSubtitle XSection 712\u2014\u2014\nNonbank stress test repealSubtitle Y\u2014Title XVH.R.4566\n\nSwaps margin exemption for interaffiliates \nSubtitle Z\n\u2014\n\u2014\n\u2014\n\nRequires consistency in enhanced regulation\nSubtitle AA\n\u2014\n\u2014\n\u2014\n\nEliminates \u201cfor cause\u201d removal protection for CFPB Director\nSubtitle BB\nSection 711(a)(1)(D)\n\u2014\n\u2014\n\nCongressional approval for \u201cmajor\u201d CFPB rules \nSubtitle CC\nTitle III, Subtitle Ba\n\u2014\nH.R. 26a\n\nSource: Congressional Research Service.\nNotes: M&A=Mergers and Acquisitions; SOX= Sarbanes Oxley Act (P.L. 107-204); IPO=Initial Public Offering.\nThese bills would require congressional approval of major rules for other agencies as well.", "type": "CRS Insight", "typeId": "INSIGHTS", "active": true, "formats": [ { "format": "HTML", "encoding": "utf-8", "url": "http://www.crs.gov/Reports/IN10950", "sha1": "e74f6d9485609a7fe00d19adf5f24824f8e37674", "filename": "files/20180807_IN10950_e74f6d9485609a7fe00d19adf5f24824f8e37674.html", "images": {} } ], "topics": [] } ], "topics": [ "Appropriations", "CRS Insights" ] }