I 

116TH CONGRESS 

1ST SESSION H. R. 1491 

To establish a FinTech Council to designate a single primary regulator 

of eligible FinTech startups, to create the Offices of Financial Innovation, 

and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 4, 2019 

Mr. DAVID SCOTT of Georgia (for himself and Mr. LOUDERMILK) introduced 

the following bill; which was referred to the Committee on Financial Services, and in addition to the Committees on Agriculture, and Energy and 

Commerce, 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 committee concerned 

A BILL 

To establish a FinTech Council to designate a single primary 

regulator of eligible FinTech startups, to create the Offices of Financial Innovation, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Facilitating Innovation 

5 and New Technology so Entrepreneurs Create and Hire 

6 Act of 2019’’ or the ‘‘FINTECH Act of 2019’’. 


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1 SEC. 2. FINTECH COUNCIL. 

2 (a) ESTABLISHMENT.—There is established within 

3 the Department of the Treasury the FinTech Council, 

4 which shall determine which Federal financial regulator 

5 or regulators should be the Designated Financial Regu6 lator of an eligible FinTech startup. 

7 (b) PETITION TO AGENCY.— 

8 (1) IN GENERAL.—An eligible FinTech startup 

9 may submit a petition to the FinTech Council, in 

10 such form and in such manner as the Council may 

11 require, to request a determination on which Federal 

12 financial regulators have enforcement authority with 

13 respect to the eligible FinTech startup. 

14 (2) CONTENTS.—In a petition submitted under 

15 this subsection, the eligible FinTech startup shall 

16 demonstrate that the eligible FinTech startup is of17 fering or intending to offer a financial innovation 

18 that— 

19 (A) will serve the public interest; 

20 (B) improves access to financial products 

21 or services; 

22 (C) does not present systemic risk to the 

23 United States financial system; 

24 (D) is a new technology or is an innovative 

25 use of existing technology; 


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1 (E) does not pose a risk to consumer pro2 tection; and 

3 (F) will not permit unfair, deceptive, or 

4 abusive acts and practices. 

5 (3) MULTIPARTY PETITIONS.—One or more eli6 gible FinTech startups that offer or intend to offer 

7 similar financial innovations may jointly submit a 

8 petition under this subsection. 

9 (c) DETERMINATION.—Upon the request of an eligi10 ble FinTech startup, the FinTech Council shall— 

11 (1) determine which one or more Federal finan12 cial regulators should be the regulators primarily re13 sponsible for oversight of the eligible FinTech start14 up; 

15 (2) designate such agencies as the Designated 

16 Financial Regulator of the eligible FinTech startup; 

17 and 

18 (3) notify the eligible FinTech startup and each 

19 Federal financial regulator of such determination. 

20 (d) SOLE ENFORCEMENT AUTHORITY BY DES21 IGNATED FINANCIAL REGULATOR.—Except for the Des22 ignated Financial Regulator, the Federal financial regu23 lators may not take any enforcement action against an eli24 gible FinTech startup. 

25 (e) AUTHORITY TO REVIEW DESIGNATION.— 


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1 (1) IN GENERAL.—With respect to an entity 

2 that has had primary regulators designated under 

3 subsection (c)(2), the FinTech Council may review 

4 the designation on an annual basis, or pursuant to 

5 a request made under paragraph (2), to determine 

6 whether— 

7 (A) there has been a material change in 

8 the business model of the entity; 

9 (B) the entity is no longer an eligible 

10 FinTech startup; 

11 (C) there are material unseen risks that 

12 weren’t present at the time of the application; 

13 or 

14 (D) the entity can no longer demonstrate 

15 that it meets the requirements described under 

16 subsection (b)(2). 

17 (2) RECOMMENDATION OF REVIEW.—If a Fed18 eral financial regulator determines that it would 

19 have, but for the prohibition under subsection (d), 

20 taken an enforcement action against an entity that 

21 has had primary regulators designated under sub22 section (c)(2), the Federal financial regulator may 

23 recommend that the FinTech Council review such 

24 designation under paragraph (1). 


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1 (3) AUTHORITY TO RESCIND DESIGNATION.—If, 

2 in reviewing a designation under paragraph (1), the 

3 FinTech Council makes a determination under sub4 paragraph (A), (B), (C), or (D) of paragraph (1), 

5 the FinTech Council may rescind the designation. 

6 (4) REAPPLICATION PERMITTED.—An eligible 

7 FinTech startup that loses its designation under this 

8 section may reapply for designation. 

9 (5) NOTICE.—If the FinTech Council rescinds 

10 a designation under this section, the Council shall— 

11 (A) immediately notify the entity that was 

12 the subject of the designation and the Congress; 

13 and 

14 (B) upon making a final determination, 

15 publicly provide a written explanation of the 

16 basis for the Council’s decision with sufficient 

17 detail to provide the public with an under18 standing of the specific basis of the Council’s 

19 determination, including any assumptions re20 lated thereof. 

21 (f) TWO-YEAR LIMITATION.—After the end of the 

22 two-year period beginning on the date an entity first has 

23 a primary regulatory designated under subsection (c)(2)— 

24 (1) any such designation is terminated; and 


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1 (2) the entity is not eligible for any future des2 ignation under subsection (c)(2). 

3 SEC. 3. OFFICE OF FINANCIAL INNOVATION. 

4 (a) ESTABLISHMENT.— 

5 (1) IN GENERAL.—Each Federal financial regu6 lator shall establish an Office of Financial Innova7 tion (‘‘Office’’). 

8 (2) DIRECTOR.—The head of each Office shall 

9 be a Director, who shall be appointed to a 5-year 

10 term by, and report to, the head of the Federal fi11 nancial regulator. 

12 (3) STAFFING.—The head of each Federal fi13 nancial regulator shall ensure that the regulator’s 

14 Office is adequately staffed at all times. 

15 (b) DUTIES.—The duties of the Office are to— 

16 (1) draft a mission statement, which shall in17 clude the phrase ‘‘responsible innovation’’; 

18 (2) coordinate and make publicly available ef19 forts made by Designated Financial Regulators re20 lated to covered actions so as to reduce the regu21 latory burden for eligible FinTech startups; 

22 (3) establish and maintain an easily-accessible 

23 website, which shall include the Office’s mission 

24 statement and a portal where eligible FinTech 


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1 startups can submit questions or request meetings 

2 with the Office; 

3 (4) respond to questions and meeting requests 

4 described under paragraph (3) in a timely manner; 

5 (5) implement recommendations from the Advi6 sory Council of FinTech Directors; 

7 (6) conduct outreach to eligible FinTech 

8 startups when a covered action is made public or fi9 nalized; and 

10 (7) provide support for the Director of the Of11 fice with respect to the Director’s duties on the Ad12 visory Council of FinTech Directors. 

13 (c) INCLUSION IN RULEMAKING.—Each Federal fi14 nancial regulator shall, throughout the development of a 

15 new rule, including prior to the publication of a notice of 

16 proposed rulemaking in the Federal Register, work with 

17 the Office in assessing the potential effects of the rule on 

18 eligible FinTech startups. Each Office shall also advise the 

19 applicable Federal financial regulator on possible alter20 natives that may lessen the burden on eligible FinTech 

21 startups without meaningfully affecting the rule’s ability 

22 to achieve its purpose. 

23 SEC. 4. REGULATORY HARMONIZATION FOR FINTECH. 

24 (a) HARMONIZATION.—Each Designated Financial 

25 Regulator shall, in taking any covered action, harmonize 


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1 and coordinate with the other Designated Financial Regu2 lators in order to eliminate duplication and conflicting reg3 ulations that will impact eligible FinTech startups. 

4 (b) ADVISORY COUNCIL OF FINTECH DIRECTORS.— 

5 (1) ESTABLISHMENT.— 

6 (A) IN GENERAL.—There is established the 

7 Advisory Council of FinTech Directors, which 

8 shall consist of— 

9 (i) the Director of each Office of Fi10 nancial Innovation; and 

11 (ii) an independent member appointed 

12 by the Secretary of the Treasury, having 

13 State-banking regulatory expertise. 

14 (B) COMPENSATION.—All members of the 

15 Advisory Council who are officers or employees 

16 of the United States shall serve without com17 pensation in addition to that received for their 

18 services as officers or employees of the United 

19 States. 

20 (2) PURPOSE.—The purpose of the Advisory 

21 Council is to provide each Federal financial regu22 lator with advice on its rules, regulations, and poli23 cies with regard to how financial innovation is re24 shaping the regulatory landscape of the financial 

25 services marketplace and whether there is any dupliVerDate Sep 11 2014 01:59 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H1491.IH H1491

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1 cation in supervision or material failure in super2 vision of eligible FinTech startups that is limiting 

3 responsible innovation for eligible FinTech startups. 

4 (3) DUTIES.—The Advisory Council shall func5 tion solely as an advisory body. Its duties shall ex6 tend only to providing advice, including advice in the 

7 form of recommendations, to each Federal financial 

8 regulator. Each Federal financial regulator shall re9 tain full authority to determine actions to be taken 

10 and policies to be expressed with respect to matters 

11 within its jurisdiction upon which the Council may 

12 provide advice. 

13 (4) REPORTS.— 

14 (A) ANNUAL REPORT.—The Advisory 

15 Council shall annually report to Congress on 

16 the activities of the Council and any significant 

17 financial market and regulatory developments 

18 that might impact eligible FinTech startups. 

19 (B) ADVICE.—The Advisory Council shall 

20 provide its advice to the Federal financial regu21 lators through the Secretary of the Treasury. 

22 The Advisory Council need not reach consensus 

23 on every issue, and may choose to provide the 

24 Federal financial regulators with differing views 

25 or a range of view. 


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1 (5) MEETINGS.—The Advisory Council of 

2 FinTech Directors shall meet at the call of the Sec3 retary of the Treasury or a majority of the members 

4 then serving, but not less frequently than annually. 

5 (6) RECORDKEEPING.—The official records 

6 generated by or for the Advisory Council shall be 

7 handled in accordance with General Records Sched8 ule 6.2, or another approved agency records disposi9 tion schedule. These records shall be available for 

10 public inspection and copying, subject to section 552 

11 of title 5, United States Code (commonly known as 

12 the ‘‘Freedom of Information Act’’). 

13 SEC. 5. DEFINITIONS. 

14 For purposes of this Act: 

15 (1) COVERED ACTION.—The term ‘‘covered ac16 tion’’ means any regulations, guidance, interpretive 

17 rules, interim final rules, bulletins, statement of pol18 icy, letters, examination manuals, frequently asked 

19 questions, notices, directives, or any other authori20 tative action that would impact an eligible FinTech 

21 startup. 

22 (2) DESIGNATED FINANCIAL REGULATOR.—The 

23 term ‘‘Designated Financial Regulator’’ means— 

24 (A) any Federal financial regulator or reg25 ulators that have been designated under section 


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1 2(c)(2) with respect to any eligible FinTech 

2 startup; and 

3 (B) with respect to an eligible FinTech 

4 startup, the specific Federal financial regulator 

5 or regulators designated under section 2(c)(2) 

6 for such eligible FinTech startup. 

7 (3) ELIGIBLE FINTECH STARTUP.—The term 

8 ‘‘eligible FinTech startup’’ means an entity that— 

9 (A) provides an application or product and 

10 has no more than 10,000 total users of such 

11 application or product; 

12 (B) has no more than 15 employees; 

13 (C) has received less than 5 rounds of ven14 ture capital; and 

15 (D) has not yet partnered with an insured 

16 depository institution (as defined under section 

17 3 of the Federal Deposit Insurance Act). 

18 (4) FEDERAL FINANCIAL REGULATOR.—The 

19 term ‘‘Federal financial regulator’’ means each of 

20 the Board of Governors of the Federal Reserve Sys21 tem, the Bureau of Consumer Financial Protection, 

22 the Commodity Futures Trading Commission, the 

23 Department of Housing and Urban Development, 

24 the Department of the Treasury, the Farm Credit 

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1 mission, the Federal Deposit Insurance Corporation, 

2 the Federal Housing Finance Agency, the Federal 

3 Trade Commission, the National Credit Union Ad4 ministration Board, the Office of the Comptroller of 

5 the Currency, and the Securities and Exchange 

6 Commission. 

Æ 


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