Rounds, Sinema Introduce Legislation to Increase Transparency and Accountability for Financial Regulators
WASHINGTON – U.S. Senators Mike Rounds (R-S.D.), a member of the Senate Committee on Banking, Housing, and Urban Affairs, and Kyrsten Sinema (I-Ariz.) introduced legislation to increase transparency and accountability within the Financial Stability Oversight Council (FSOC). The FSOC Improvement Act would enhance transparency and procedural fairness of the systemically important financial institutions (SIFI) designation process.
Specifically, this legislation would codify 2019 guidance that requires FSOC to determine whether systemic risks could be better addressed through means other than designating a financial institution as a SIFI. It would also require them to consult with the primary regulator and the company on other means to address potential threats to financial stability. Finally, the legislation enhances transparency at the FSOC by requiring the council and its member agencies to report on crisis planning activities and potential threats.
“I believe the FSOC Improvement Act is a crucial step towards enhancing the effectiveness and transparency of our financial regulatory system,” said Rounds. “SIFI designation is a blunt tool that comes with a significant increase in regulatory burden for individual companies. By allowing an affected institution to modify its business, structure or operations prior to the SIFI designation, we are creating a more resilient financial environment for the American people, fostering economic growth and stability.”
“We’re fueling growth and creating careers for Arizonans while increasing transparency,” said Sinema.
Rounds first introduced the FSOC Improvement Act in 2018 during the 115th Congress. Rounds reintroduced this legislation to the 116th Congress in 2019, with Sinema as an original cosponsor.
Click HERE for full bill text.