Panel OKs safe harbor for FIs working with law enforcement, pares role of Federal Insurance Office

The House Financial Services Committee on Thursday marked up a bill to give financial institutions a safe harbor for maintaining certain, suspicious accounts; and another largely removing the Federal Insurance Office’s (FIO) current focus on domestic insurance issues.

H.R. 5783, the Cooperate with Law Enforcement Agencies and Watch Act of 2018, was introduced by Rep. French Hill (R-Ark.) and approved by the committee on a vote of 55-0. As amended through a substitute measure, it would allow a financial institution to comply with a written request by law enforcement – meaning federal, state, tribal or local law enforcement body – to maintain a suspicious account without being penalized by any federal or state department or agency.

Also approved was H.R. 3861, the Federal Insurance Office Reform Act of 2017. Introduced by Rep. Sean Duffy (R-Wis.) this bill would move the Federal Insurance Office (FIO, created under the Dodd-Frank Act) from Treasury’s Office of Domestic Finance to the Office of International Affairs and would also take it out of the Financial Stability Oversight Council (FSOC), where it currently has an advisory role. The bill eliminates the FIO’s subpoena power and limits its ability to issue reports. Its main goal is to focus the office on coordination between state insurance regulators and the federal government on international insurance matters, eliminating any direct role specific to domestic insurance matters.

An amendment modifying the FIO bill somewhat – reportedly allowing Treasury to direct the FIO to involve itself in domestic insurance issues – was sought and approved by Rep. Ed Royce (R-Calif.), but in the end, Royce voted against approving the marked-up bill. He was the only Republican to do so. The bill cleared the committee on a vote of 36-21.

Also approved were H.R. 5877, the Main Street Growth Act (on a vote of 56-0); H.R. 5054, the Small Company Disclosure Simplification Act of 2018 (32-23); H.R. 5756, requiring the Securities and Exchange Commission to adjust certain resubmission thresholds for share holder proposals (34-22); and H.R. 4557, the Reforming Disaster Recovery Act of 2017 (53-3).

Mark-up with amendments, votes

Committee advance six bills (press release)