FSR to candidates: How do you plan to modernize financial regulations?

With the Republican and Democratic national conventions coming up, the Financial Services Roundtable (FSR) has called on the presidential candidates to provide details on how they plan to increase transparency, modernize and better coordinate the financial regulatory process.

This is part of the FSR’s 2016 Presidential Focus Series, an advocacy initiative to highlight consumer issues on which the presidential candidates should focus as they campaign.

“We call on the presidential candidates to lay out their plans on how they will make the federal government more transparent while modernizing our existing laws to increase innovation and better serve and protect consumers,” FSR Executive Director Eric Hoplin said in a news release.

The FSR listed 10 questions for the candidates:

  1. What is your view on how to judge the effectiveness of U.S. financial regulators?
  2. Federal financial regulatory authority is currently split between nine different agencies. How would you ensure these agencies collaborate effectively while also ensuring innovation and investment isn’t stifled? What should happen when regulatory agencies issue conflicting requirements? Should steps be taken to streamline financial regulations or the agencies that administer them?
  3. Would you consider enhancing transparency and reforming other issues with the SIFI designation process for financial institutions? If so, what would you do?
  4. How can we ensure that new financial regulations are fair to smaller institutions?
  5. What is your view on how regulators should interact with foreign regulators? How deferential should U.S. representatives be to outside interests when they participate in multi-national organizations such as the Basel Committee on Banking Supervision or the International Association of Insurance Supervisors?
  6. Which regulations might you consider modernizing and how would you direct regulatory agencies to make reforms and/or how would you work with Congress to get them done?
  7. What steps should regulators take to ensure that regulations don’t restrict credit to qualified buyers and avoid unintended consequences?
  8. What will you do to foster expanded cyber defense collaboration across U.S. government departments and agencies?
  9. What steps will you take to ensure that cyberthreat information the U.S. government learns from its sensitive or classified sources is made available to network owners and operators in U.S. critical infrastructure in a transparent and expeditious fashion?
  10. Do you believe the CFPB would be more transparent and effective as a single director or a commission and why? How will you direct the CFPB to balance protecting consumers while keeping access to needed financial products available to consumers across the financial spectrum?

The Government Accountability Office released a report earlier this year finding that the Dodd-Frank Act did not ensure efficient, effective or consistent oversight of financial institutions and that the “overly complex” structure and fragmentation of regulations may allow some to escape proper regulation.

Regulators have been undertaking their first review under the Economic Growth and Regulatory Paperwork Reduction Act of 1996 (EGRPRA) to identify outdated, unnecessary or unduly burdensome regulations that impact a bank’s ability to serve its customers effectively and efficiently.

Rules transferred to the Consumer Financial Protection Bureau (CFPB) and anti-money laundering regulations issued by the Treasury’s Financial Crimes Enforcement Network (FinCEN) were not covered by the EGRPRA process, despite requests from lawmakers and industry stakeholders to review the Dodd-Frank Act.

The agencies held their last outreach meeting for EGRPRA in December 2015. In March, the Office of the Comptroller of the Currency issued a proposal to revise certain regulations as part of the EGRPRA process.

Each week leading up to the conventions, FSR will highlight a specific consumer issue to raise awareness, educate the candidates and further the conversation.

“Presidential candidates should outline for the American people how they will grow the economy, encourage innovation and modernize our regulatory system to help consumers and protect taxpayers,” FSR CEO Tim Pawlenty said.

Other topics that will, or have been, covered in the FSR’s series include:

  • Protecting Americans’ personal and financial data,
  • Ending Fannie Mae and Freddie Mac bailouts,
  • Encouraging innovation,
  • Enhancing financial literacy and financial inclusion,
  • Ensuring a secure retirement for all,
  • Protecting inventions and innovation from trolls, and
  • Economic growth and tax reform.

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