Financial Transparency Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 4476 To amend securities, commodities, and banking laws to make the information reported to financial regulatory agencies electronically searchable, to fur- ther enable the development of RegTech and Artificial Intelligence appli- cations, to put the United States on a path towards building a com- prehensive Standard Business Reporting program to ultimately har- monize and reduce the private sector’s regulatory compliance burden, while enhancing transparency and accountability, and for other purposes. IN THE HOUSE OF REPRESENTATIVES SEPTEMBER 24, 2019 Mrs. CAROLYN B. MALONEY of New York (for herself and Mr. MCHENRY) introduced the following bill; which was referred to the Committee on Fi- nancial Services, and in addition to the Committee on Agriculture, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the com- mittee concerned A BILL To amend securities, commodities, and banking laws to make the information reported to financial regulatory agencies electronically searchable, to further enable the develop- ment of RegTech and Artificial Intelligence applications, to put the United States on a path towards building a comprehensive Standard Business Reporting program to ultimately harmonize and reduce the private sector’s regulatory compliance burden, while enhancing trans- parency and accountability, and for other purposes. VerDate Sep 11 2014 20:54 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6652 E:\BILLS\H4476.IH H4476 pamtmann on DSKBC07HB2PROD with BILLS 2 •HR 4476 IH Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 3 (a) SHORT TITLE.—This Act may be cited as the 4 ‘‘Financial Transparency Act of 2019’’. 5 (b) TABLE OF CONTENTS.—The table of contents for 6 this Act is as follows: 7 Sec. 1. Short title; table of contents. TITLE I—DEPARTMENT OF THE TREASURY Sec. 101. Data standards. Sec. 102. Open data publication by the Department of the Treasury. Sec. 103. Rulemaking. Sec. 104. Classified and protected information. Sec. 105. No new disclosure requirements. Sec. 106. Report. Sec. 107. Conforming amendments to the Office of Financial Research. TITLE II—SECURITIES AND EXCHANGE COMMISSION Sec. 201. Data standards requirements for the Securities and Exchange Com- mission. Sec. 202. Open data publication by the Securities and Exchange Commission. Sec. 203. Data transparency at the Municipal Securities Rulemaking Board. Sec. 204. Data transparency at national securities associations. Sec. 205. Shorter-term burden reduction and disclosure simplification at the Securities and Exchange Commission; sunset. Sec. 206. No new disclosure requirements. TITLE III—FEDERAL DEPOSIT INSURANCE CORPORATION Sec. 301. Data standards requirements for the Federal Deposit Insurance Cor- poration. Sec. 302. Open data publication by the Federal Deposit Insurance Corporation. Sec. 303. Rulemaking. Sec. 304. No new disclosure requirements. TITLE IV—OFFICE OF THE COMPTROLLER OF THE CURRENCY Sec. 401. Data standards and open data publication requirements for the Office of the Comptroller of the Currency. Sec. 402. Rulemaking. Sec. 403. No new disclosure requirements. TITLE V—BUREAU OF CONSUMER FINANCIAL PROTECTION Sec. 501. Data standards and open data publication requirements for the Bu- reau of Consumer Financial Protection. VerDate Sep 11 2014 20:54 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6211 E:\BILLS\H4476.IH H4476 pamtmann on DSKBC07HB2PROD with BILLS 3 •HR 4476 IH Sec. 502. Rulemaking. Sec. 503. No new disclosure requirements. TITLE VI—FEDERAL RESERVE SYSTEM Sec. 601. Data standards requirements for the Board of Governors of the Fed- eral Reserve System. Sec. 602. Open data publication by the Board of Governors of the Federal Re- serve System. Sec. 603. Rulemaking. Sec. 604. No new disclosure requirements. TITLE VII—COMMODITY FUTURES TRADING COMMISSION Sec. 701. Data standards. Sec. 702. Open data publication by the Commodity Futures Trading Commis- sion. Sec. 703. Rulemaking. Sec. 704. No new disclosure requirements. TITLE VIII—NATIONAL CREDIT UNION ADMINISTRATION Sec. 801. Data standards. Sec. 802. Open data publication by the National Credit Union Administration. Sec. 803. Rulemaking. Sec. 804. No new disclosure requirements. TITLE IX—FEDERAL HOUSING FINANCE AGENCY Sec. 901. Data standards requirements for the Federal Housing Finance Agen- cy. Sec. 902. Open data publication by the Federal Housing Finance Agency. Sec. 903. Rulemaking. Sec. 904. No new disclosure requirements. TITLE X—MISCELLANEOUS Sec. 1001. Rule of construction. TITLE I—DEPARTMENT OF THE 1 TREASURY 2 SEC. 101. DATA STANDARDS. 3 (a) IN GENERAL.—Subtitle A of title I of the Finan- 4 cial Stability Act of 2010 (12 U.S.C. 5311 et seq.) is 5 amended by adding at the end the following: 6 ‘‘SEC. 124. DATA STANDARDS. 7 ‘‘(a) IN GENERAL.—The Secretary of the Treasury 8 shall, by rule, promulgate data standards, meaning a 9 VerDate Sep 11 2014 20:54 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4476.IH H4476 pamtmann on DSKBC07HB2PROD with BILLS 4 •HR 4476 IH standard that specifies rules by which data is described 1 and recorded, for the information reported to member 2 agencies by financial entities under the jurisdiction of the 3 member agency and the data collected from member agen- 4 cies on behalf of the Council. 5 ‘‘(b) STANDARDIZATION.—Member agencies, in con- 6 sultation with the Secretary of the Treasury, shall imple- 7 ment regulations promulgated by the Secretary of the 8 Treasury under subsection (a) to standardize data re- 9 ported to member agencies or collected on behalf of the 10 Council, as described under subsection (a). If a member 11 agency fails to implement such regulations prior to the 12 expiration of the 3-year period following the date of publi- 13 cation of final regulations, the Secretary of the Treasury, 14 in consultation with the Chairperson, may implement such 15 regulations with respect to the financial entities under the 16 jurisdiction of the member agency. 17 ‘‘(c) DATA STANDARDS.— 18 ‘‘(1) COMMON IDENTIFIERS.—The data stand- 19 ards promulgated under subsection (a) shall include 20 common identifiers for information reported to mem- 21 ber agencies or collected on behalf of the Council, in- 22 cluding a common nonproprietary legal entity identi- 23 fier that is available under an open license (as de- 24 fined under section 3502 of title 44, United States 25 VerDate Sep 11 2014 20:54 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4476.IH H4476 pamtmann on DSKBC07HB2PROD with BILLS 5 •HR 4476 IH Code) for all entities required to report to member 1 agencies. 2 ‘‘(2) DATA STANDARD.—The data standards 3 promulgated under subsection (a) shall, to the extent 4 practicable— 5 ‘‘(A) render data fully searchable and ma- 6 chine-readable (as defined under section 3502 7 of title 44, United States Code); 8 ‘‘(B) enable high quality data through 9 schemas, with accompanying metadata (as de- 10 fined under section 3502 of title 44, United 11 States Code) documented in machine-readable 12 taxonomy or ontology models, which clearly de- 13 fine the data’s semantic meaning as defined by 14 the underlying regulatory information collection 15 requirements; 16 ‘‘(C) assure that a data element or data 17 asset that exists to satisfy an underlying regu- 18 latory information collection requirement be 19 consistently identified as such in associated ma- 20 chine-readable metadata; 21 ‘‘(D) be nonproprietary or made available 22 under an open license; 23 VerDate Sep 11 2014 20:54 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H4476.IH H4476 pamtmann on DSKBC07HB2PROD with BILLS 6 •HR 4476 IH ‘‘(E) incorporate standards developed and 1 maintained by voluntary consensus standards 2 bodies; and 3 ‘‘(F) use, be consistent with, and imple- 4 ment applicable accounting and reporting prin- 5 ciples. 6 ‘‘(3) CONSULTATION.—In promulgating data 7 standards under subsection (a), the Secretary of the 8 Treasury shall consult with other Federal depart- 9 ments and agencies and multi-agency initiatives re- 10 sponsible for Federal data standards. 11 ‘‘(4) INTEROPERABILITY OF DATA.—In promul- 12 gating data standards under subsection (a), the Sec- 13 retary of the Treasury shall seek to promote inter- 14 operability of financial regulatory data across mem- 15 bers of the Council.’’. 16 (b) CLERICAL AMENDMENT.—The table of contents 17 under section 1(b) of the Dodd-Frank Wall Street Reform 18 and Consumer Protection Act is amended by inserting 19 after the item relating to section 123 the following: 20 ‘‘Sec. 124. Data standards.’’. SEC. 102. OPEN DATA PUBLICATION BY THE DEPARTMENT 21 OF THE TREASURY. 22 Section 124 of the Financial Stability Act of 2010, 23 as added by section 101, is amended by adding at the end 24 the following: 25 VerDate Sep 11 2014 20:54 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H4476.IH H4476 pamtmann on DSKBC07HB2PROD with BILLS 7 •HR 4476 IH ‘‘(d) OPEN DATA PUBLICATION.—All public informa- 1 tion published by the Secretary of the Treasury under this 2 subtitle shall be made available as an open Government 3 data asset (as defined under section 3502 of title 44, 4 United States Code), freely available for download in bulk, 5 and rendered in a human-readable format and accessible 6 via application programming interface where appro- 7 priate.’’. 8 SEC. 103. RULEMAKING. 9 Not later than the end of the 2-year period beginning 10 on the date of the enactment of this Act, the Secretary 11 of the Treasury shall issue the regulations required under 12 the amendments made by this title. The Secretary may 13 delegate the functions required under the amendments 14 made by this title to an appropriate office within the De- 15 partment of the Treasury. 16 SEC. 104. CLASSIFIED AND PROTECTED INFORMATION. 17 Nothing in this title or the amendments made by this 18 title shall require the disclosure to the public of— 19 (1) information that would be exempt from dis- 20 closure under section 552 of title 5, United States 21 Code (commonly known as the ‘‘Freedom of Infor- 22 mation Act’’); or 23 (2) information protected under section 552a of 24 title 5, United States Code (commonly known as the 25 VerDate Sep 11 2014 20:54 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H4476.IH H4476 pamtmann on DSKBC07HB2PROD with BILLS 8 •HR 4476 IH ‘‘Privacy Act of 1974’’), or section 6103 of the In- 1 ternal Revenue Code of 1986. 2 SEC. 105. NO NEW DISCLOSURE REQUIREMENTS. 3 Nothing in this title or the amendments made by this 4 title shall be construed to require the Secretary of the 5 Treasury to collect additional information under the stat- 6 utes amended by this title, beyond information that was 7 collected under such statutes before the date of the enact- 8 ment of this Act. 9 SEC. 106. REPORT. 10 Not later than 1 year after the end of the 2-year pe- 11 riod described in section 103, the Comptroller General of 12 the United States shall submit to Congress a report on 13 the feasibility, costs, and potential benefits of building 14 upon the taxonomy established by this Act to arrive at 15 a Federal Government-wide regulatory compliance stand- 16 ardization mechanism similar to Standard Business Re- 17 porting. 18 SEC. 107. CONFORMING AMENDMENTS TO THE OFFICE OF 19 FINANCIAL RESEARCH. 20 Section 153 of the Financial Stability Act of 2010 21 (12 U.S.C. 5343) is amended— 22 (1) in subsection (a)— 23 (A) by striking paragraph (2); and 24 VerDate Sep 11 2014 20:54 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H4476.IH H4476 pamtmann on DSKBC07HB2PROD with BILLS 9 •HR 4476 IH (B) by redesignating paragraphs (3) 1 through (7) as paragraphs (2) through (6), re- 2 spectively; and 3 (2) by amending subsection (c) to read as fol- 4 lows: 5 ‘‘(c) RULEMAKING AUTHORITY.—The Office, in con- 6 sultation with the Chairperson, shall issue rules, regula- 7 tions, and orders only to the extent necessary to carry out 8 the purposes and duties described in paragraphs (1) and 9 (6) of subsection (a).’’. 10 TITLE II—SECURITIES AND 11 EXCHANGE COMMISSION 12 SEC. 201. DATA STANDARDS REQUIREMENTS FOR THE SE- 13 CURITIES AND EXCHANGE COMMISSION. 14 (a) DATA STANDARDS FOR INVESTMENT ADVISERS’ 15 REPORTS UNDER THE INVESTMENT ADVISERS ACT OF 16 1940.—Section 204 of the Investment Advisers Act of 17 1940 (15 U.S.C. 80b–4) is amended— 18 (1) by redesignating the second subsection (d) 19 (relating to Records of Persons With Custody of 20 Use) as subsection (e); and 21 (2) by adding at the end the following: 22 ‘‘(f) DATA STANDARDS FOR REPORTS FILED UNDER 23 THIS SECTION.— 24 VerDate Sep 11 2014 20:54 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H4476.IH H4476 pamtmann on DSKBC07HB2PROD with BILLS 10 •HR 4476 IH ‘‘(1) REQUIREMENT.—The Commission shall, 1 by rule, adopt data standards for all reports filed by 2 investment advisers with the Commission under this 3 section. 4 ‘‘(2) CHARACTERISTICS.—The data standards 5 required by paragraph (1) shall, to the extent prac- 6 ticable— 7 ‘‘(A) render data fully searchable and ma- 8 chine-readable (as defined under section 3502 9 of title 44, United States Code); 10 ‘‘(B) enable high quality data through 11 schemas, with accompanying metadata (as de- 12 fined under section 3502 of title 44, United 13 States Code) documented in machine-readable 14 taxonomy or ontology models, which clearly de- 15 fine the data’s semantic meaning as defined by 16 the underlying regulatory information collection 17 requirements; 18 ‘‘(C) assure that a data element or data 19 asset that exists to satisfy an underlying regu- 20 latory information collection requirement be 21 consistently identified as such in associated ma- 22 chine-readable metadata; 23 VerDate Sep 11 2014 20:54 Oct 01, 2019 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H4476.IH H4476 pamtmann on DSKBC07HB2PROD with BILLS 11 •HR 4476 IH ‘‘(D) be nonproprietary or made available 1 under an open license (as defined under section 2 3502 of title 44, United States Code); 3 ‘‘(E) incorporate standards developed and 4 maintained by voluntary consensus standards 5 bodies; and 6 ‘‘(F) use, be consistent with, and imple- 7 ment applicable accounting and reporting prin- 8 ciples. 9 ‘‘(3) INCORPORATION OF STANDARDS.—In 10 adopting data standards by rule under this sub- 11 section, the Commission shall incorporate all applica- 12 ble data s [Text truncated for display. 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