PROVIDING FOR CONSIDERATION OF H.R. 4061, FINANCIAL STABILITY OVERSIGHT COUNCIL IMPROVEMENT ACT OF 2017, AND PROVIDING FOR CONSIDERATION OF H.R. 4293, STRESS TEST IMPROVEMENT ACT OF 2017
Dennis A. Ross (Republican, FL) \u2014 2018-3-15

. Madam , I thank my friend from Colorado for yielding. prgtoken Madam , I rise in support of the rule and my underlying legislation, H.R. 4061, the Financial Stability Oversight Council Improvement Act of 2017. prgtoken Madam , when folks back home save for retirement, college, or a down payment on a house, they expect that the system is both safe and geared towards maximizing their benefit. prgtoken A beautiful thing about America's free enterprise system is how anyone can participate in the marketplace, strengthen the economy, and earn a dividend of the American Dream. That opportunity, however, is not guaranteed, and, as lawmakers, we have a duty to protect it. prgtoken My bill will help us do just that by improving the Financial Stability Oversight Council's process for reviewing nonbank financial institutions for potential systemic threats. We must be clear that simply designating more companies as systemically important financial institutions doesn't make our system safer. prgtoken The FSOC can better serve the American people by working with prudential regulators and the private sector to address threats to our economy before they transform into calamities. prgtoken Would you say it is sufficient for firefighters just to identify a house that is on fire? prgtoken Of course not. The key is preventing the fire in the first place. prgtoken This is the problem that we face with the FSOC's oversight of nonbank financial institutions. The FSOC may be able to identify tinderboxes, but fails to explain how they might be made less flammable, and, instead, the Council defaults to what should be the heavyhanded regulations of last resort. prgtoken To be sure, the FSOC has begun to recognize the benefits of leveraging the expertise of prudential regulators, as well as providing increased transparency. In recent years, they have taken steps to improve the designation process, including the February 2015 guidance providing increased transparency in the nonbank SIFI designation process. prgtoken These 2015 reforms were welcome, and this legislation will codify many of prgtoken them into law, as well as provide a path for a nonbank financial company to eliminate risk rather than be designated. prgtoken Importantly, our legislation will ensure a company's primary regulator has a meaningful role in the SIFI designation process. After 8 years, if we don't take steps to address the obvious shortcomings of the FSOC, like the nonbank designation process, the regulator intended to protect financial stability could very well become a liability. prgtoken The American Action Forum has found that additional capital requirements resulting from a SIFI designation of asset management firms could affect American retirees in the amount of at least $100,000 in potential savings over the lifetime of their investments. prgtoken That is why these reforms included in H.R. 4061 are critical to the more than 90 million investors who rely on the servic