Rep. García’s Bipartisan Legislation to Prevent Tech Companies and other Retailers to Act Like Unregulated Banks Passes in Committee
Rep. García’s Bipartisan Legislation to Prevent Tech Companies and other Retailers to Act Like Unregulated Banks Passes in Committee
The Close the ILC Loophole Act will help keep our financial system safe and secure
WASHINGTON, DC — Today, the House Financial Services Committee approved the bipartisan Close the ILC Loophole Act introduced by Congressman Jesús “Chuy” García (IL-04) and Congressman Lance Gooden (TX-05), both members of the committee. This legislation will prevent large technology companies, retail firms and payday lenders from owning an industrial loan company (ILC) charter and operating a bank without any of the oversight, safeguards and limitations that apply to such institutions. Congressman García issued the following statement:
“My constituents know that working class people like them pay the price when our financial system is unstable, and my bipartisan Close the ILC Loophole Act is an urgently needed measure that protects consumers, encourages competition, and promotes financial stability and fairness,” said Congressman García. “This bill will finally close the ILC loophole and create a level regulatory playing field for these banks. I urge my colleagues to pass it out of the House and into law as soon as possible.”
Congressman Gooden said, “Congress must prevent Big Tech companies from exploiting loopholes in our financial system to gather Americans’ personal financial information and crush smaller financial institutions. The ILC loophole allows these companies to avoid traditional banking regulations, providing them with a significant competitive advantage, and I am proud of the Financial Services Committee members who worked with me to close that loophole and ensure community banks are protected.”
The Close the ILC Loophole Act will end the issuance of new ILC’s, establish proper oversight of the parent companies of existing ILC’s, and provide a fair process for pending ILC applications.
This legislation is supported by a broad coalition of regulated banks, credit unions, and consumer protection organizations, including: Americans for Financial Reform, Bank Policy Institute, Center for Responsible Lending, Consumer Federation of America, Credit Union National Association, Independent Community Bankers of America, Mid-Size Bank Coalition of America, National Association of Federally-Insured Credit Unions, National Consumer Law Center, National Community Reinvestment Coalition and U.S. PIRG.
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