Bill to create fintech task force, address illicit use of digital currencies passes House

A bill to create a Treasury-led financial technology (fintech) task force to improve public and private sector coordination on ways to reduce terrorist and illicit use of new financial technologies, including digital currencies, was passed by the House Wednesday.

Titled the Financial Technology Protection Act (H.R. 5036), the measure would create the “Independent Financial Technology Task Force to Combat Terrorism and Illicit Financing” and a new program called the “FinTech Leadership in Innovation and Financial Intelligence Program.” Headed by the Treasury secretary, the task force would research and develop legislative and regulatory proposals to improve counter-terrorist and counter-illicit financing efforts, and it would provide yearly reports to Congress on its proposals.

In addition to the Treasury secretary, task force members would include the U.S. attorney general, director of national intelligence and the heads of the Financial Crimes Enforcement Network (FinCEN), Secret Service and FBI. Six private-sector representatives, appointed by the Treasury secretary, would also be included. These could be representatives from the banking industry, nonprofit groups and think tanks; at least two of the six private-sector posts would be reserved for someone with experience in the fintech industry.

The bill would also require creation of a fund, not exceeding $450,000, to pay a reward “to any person who provides information leading to the conviction of an individual involved with terrorist use of digital currencies.”

Additional bills passed Wednesday (and reported on previously by Regulatory Report) included:

  • Federal Reserve Supervision Testimony Clarification Act (H.R. 4753), to require the Fed Board vice chairman to fulfill the statutory requirement for semi-annual testimony of the Fed’s vice chairman for supervision if the latter position is vacant (passed on voice vote);
  • Banking Transparency for Sanctioned Persons Act of 2018 (H.R. 6751), to require the Treasury secretary to issue a semi-annual report to the House Financial Services Committee and Senate Banking Committee regarding financial services provided to state sponsors of terrorism or certain sanctioned individuals (passed on voice vote);
  • Protect Affordable Mortgages for Veterans Act of 2018 (H.R. 6737), making a technical change to ensure that recently executed mortgage loans refinanced by the Department of Veterans Affairs Home Loans remain eligible for pooling in Ginnie Mae securities (passed on voice vote); and
  • Empowering Financial Institutions to Fight Human Trafficking Act of 2018 (H.R. 6729), instructing the Treasury secretary to implement a safe harbor for non-profit organizations when sharing specific information with financial institutions that facilitates their duties of customer due diligence and suspicious activity reporting related to human trafficking, (approved on a roll-call vote of 297-124).

The House earlier this week also passed the 7(a) Real Estate Appraisal Harmonization Act (H.R. 6347), and Small Business Access to Capital and Efficiency Act (H.R. 6348), which would conform the Small Business Administration’s appraisal thresholds in its 7(a) and 504 programs with those of federal banking regulators. Both were passed on voice vote.