Legislative Update

Last Friday, Rep. Blaine Luetkemeyer released the text of legislation that would codify federal regulators’ data breach notification standards for the financial services industry and preempt state-by-state requirements. The new bill includes language targeted at the insurance industry, mandating that state insurance officials establish data security safeguards for customer information that are the same as the guidelines drafted by federal bank regulators.

As retailers and banks have been unsuccessful at reaching a consensus on data security in the past, this bill is a step back from legislation Luetkemeyer proposed earlier this year that would have applied data security requirements beyond the financial services industry to a larger number of retailers that handle consumers’ information.

“We thought we needed to get the bill moving and get something done this session,” Luetkemeyer said last week. “We’re going to hopefully get the bill moved out of committee and we’ll raise the bar that much.”

House Financial Services Committee Chairman Jeb Hensarling and Rep. John Delaney released their discussion draft of legislation that would repeal Fannie Mae’s and Freddie Mac’s charters and replace them with Ginnie Mae. Hensarling also released a summary and section-by-section analysis.

“Housing finance reform will not get done unless it is done on a bipartisan basis and unless it has the support of the administration,” Hensarling told reporters last week. He went on to note that the discussion draft “lays the foundation for what I believe to be the grand bargain for housing finance reform.”