Patrick McHenry

Mr. McHENRY

Mr. McHENRY. What I am highlighting is the fact that, in one section of the bill, you have the study to say whether or not using Social Security numbers is good or bad. I think that is good. That was laudable. The problem is, in another part of the bill, you mandate immediately that they need the fullness of the Social Security numbers in order for the data to be included. That is what I am highlighting, and that is one of the rubs that I have with the bill.

Mr. McHENRY. The point is, we could have had a massive vote on something that reformed them rather than bring them in and wag our finger again.

Mr. McHENRY

Mr. McHENRY. Madam Speaker, I reserve the balance of my time.

Mr. McHENRY. Madam Speaker, I yield 3 minutes to the gentleman from Michigan (Mr. Huizenga), my friend and the ranking member of the Subcommittee on Investor Protection, Entrepreneurship, and Capital Markets.

Mr. McHENRY

Mr. McHENRY. Madam Speaker, due to a family situation, I was unable to attend yesterday's vote. Had I been present, I would have voted NAY on Roll Call No. 103, and YEA on Roll Call No. 104.

Mr. McHENRY

Mr. McHENRY. Mr. Speaker, this unprecedented time in our nation's history calls for an unprecedented response. This is not like any economic or health issue we've faced. This is a voluntary shut down of vast parts of the economy in an effort to save American lives, and, as a result, we need the CARES Act. It's important to remember, this is not a stimulus package, this is emergency relief. And this is not a bailout for bad business decisions or one specific industry. The CARES Act, while not perfect, is the appropriate action to provide necessary resources to get Americans and our economy through this national emergency. My ultimate goal for this legislation is to keep Americans employed. Specifically, this bill will provide relief to our small businesses to help them keep employees on payroll and prepare those businesses to be up and running as soon as America is open for business again. The CARES Act provides $377 billion in small business loans. This will allow a small business to go to any federally insured financial institution to access those loans--many of which will be forgiven if used to support keeping employees on payroll, another important provision to help keep folks employed. This bill also provides Treasury Secretary Mnuchin and Fed Chairman Powell with the resources they need to address the liquidity crisis facing the main street businesses that employ millions of Americans. The CARES Act allows them the flexibility to meet the needs of American businesses in the coming weeks and months by allocating $500 billion to an Exchange Stabilization Fund, or ESF. This critical funding will allow the Treasury Secretary to provide loans and loan guarantees to businesses of all sizes. Of that $500 billion, $454 billion assists the Treasury Department and Federal Reserve in loan facilities and programs to help distressed businesses. This funding has the potential to unleash more than $4 trillion in lending to businesses of all sizes, consumers, local governments, and money market funds. We know Americans can't wait for this relief. I'm glad the CARES Act is soon headed to the President's desk for his signature and to the aid of families across our country.

Mr. McHENRY

Mr. McHENRY. Mr. Chairman, I yield myself such time as I may consume. I am happy to see my friends on the other side of the aisle take the same interest that we have on this side of the aisle in protecting cybersecurity and protecting consumer data. I think it is great that this is a bipartisan concern that we share. This amendment reaffirms the data security concerns that Republicans have highlighted in the past with respect to credit reporting agencies, including back in February of last year, the only time we had a hearing in the House Financial Services Committee on the credit reporting agencies. We want to ensure that these credit reporting agencies protect our data. The collection and maintenance of our personal information and exposing that to risk is deeply problematic. All we need to do is look back a few years ago to the Equifax breach to understand how vital cybersecurity standards are, not only at the consumer credit reporting agencies, but across the financial sector. I appreciate the gentleman from Maryland using the language from my substitute amendment that I offered before the Rules Committee and before the House Financial Services Committee and incorporating it into this amendment. I am disappointed that the rest of the bill was not as bipartisan as this amendment text. Since this bill is not going anywhere, I would ask whether or not the author of the amendment would be interested in drafting a separate suspensionable--I think it has wide bipartisan support--a suspension- worthy version of this as a stand-alone bill. I yield to the gentleman from Maryland.

Mr. McHENRY. Mr. Chair, as we all know, homelessness is an issue that has plagued the lives of many Americans across this country, and we know the particular crisis that is in Los Angeles. I know that the gentleman is trying to deal with the particular issues of his home State, and so I commend him for that. But he is also highlighting something that has been a big debate--not debate, but a big point of discussion, I would say, and shared concern about homelessness that we have in the Financial Services Committee. I know every committee of jurisdiction has homelessness as a part of their agenda, but we are the committee that does housing, and we are trying to draw some consensus on how we deal with this homelessness crisis. We have a crisis of affordability across the country, but in particular, in high growth areas. It is a blessing that it is a high- growth area, but there is an enormous number of challenges that come along the way. It means that commutes get longer for people who are working-class folks. It means that you have folks who are making serious life decisions with a great limitation, right? So that impairs, I think, economic growth. It is not just in New York or Los Angeles or San Francisco where there is a homelessness crisis. I say this not using it as words of attack to the sponsor of this. It is not. We have a homelessness crisis in every community in America because we have homeless. We have a veterans homelessness crisis because if we have a single veteran who is homeless, that is not in keeping with who we are as America. So I think it is important to raise this issue of homelessness in every way we can. I think a number of the policies that have been offered this Congress will make things worse, not better. For the affordability challenge, I feel like national rent control policies and things of that sort will move us in the wrong direction for ensuring that we have enough housing stock for those who seek it. With the changing nature of how people want to live, we have to make sure that housing stock fits with that so you are able to grow housing stock to meet that need, not just for young people, but for old people and everybody in between, as I find out I am getting old, right? But with this, I appreciate my colleague for offering this amendment. I think it is a thoughtful approach. It gives us the opportunity to have a wider discussion about homelessness and the challenges therein to those experiencing it, to the communities that are struggling with it, and to all of us to come to terms with the best way to approach it. Look, this doesn't tip the balance in my view of the underlying bill. For those of you who have been paying attention to this debate, I won't repeat myself on this, but this is the final amendment. I think the bill's sponsor is of goodwill in trying to address this. The underlying bill is still deeply problematic to me, but I commend my colleague for raising that. Mr. Chair, I reserve the balance of my time.

Mr. McHENRY. Mr. Chair, I claim the time in opposition to the amendment, even though I am not opposed to it.

Mr. McHENRY. Mr. Chairman, reclaiming my time, I thank my new colleague, but bipartisanship is kind of rare to happen around here, so when it is offered, let's just go try to get it, try to work on it. That would be my suggestion, Mr. Chairman. Since this is the language, verbatim, from my substitute, I am trying to be charitable. But with that, like I said, I am not opposed to the amendment. In fact, I am proud to really have written the contents of what is being offered. I am grateful that the gentleman offered it and the Rules Committee approved it, because they didn't approve my stand-alone amendment in the nature of a substitute. Mr. Chairman, we are not going to resolve those broader issues, but I am happy to work with the gentleman if he is ever interested in a bipartisan bill on this measure. I am happy to do that. I am fine with the passage of this. I think the underlying bill is still deeply flawed. This doesn't tip the balance for me to make an awful bill really good, but it does make an awful bill just slightly less awful. Mr. Chairman, I yield back the balance of my time.

Mr. McHENRY. Mr. Chair, I claim the time in opposition. I am opposed to the amendment.

Mr. McHENRY. I will inquire of the Chair; how much time remains on both sides.

Mr. McHENRY. Mr. Chair, again, for the overall bill, to put a bow on this, if you will, this bill is about socializing credit scores. If you socialize credit scores, you can socialize credit. If you can socialize credit, then you can have government make the decision about the allocation of credit in the private sector. This is a larger narrative from the far left in this country, which has now taken the opportunity to attempt to make legislative gains. The President has said he will not sign this bill, thankfully, which is good for the American consumer. Furthermore, I don't see this seeing the light of day in the Senate. Having said that, we still need to have a serious bipartisan conversation about how to reform the credit reporting agencies and the law that underlies their regulatory framework. Mr. Chair, I am grateful for the opportunity to debate here on the House floor. While I am not opposed to this amendment, I remain opposed to the overall bill and will urge my colleagues to vote ``no'' on that. But, again, I commend the gentleman from California (Mr. Panetta) for his offering of a thoughtful amendment dealing with homelessness and raising this issue, not as a local issue, but as one of national import and one worthy of debate here on the House floor. Mr. Chair, I yield back the balance of my time.

Mr. McHENRY. Mr. Chairman, I would say I think the gentleman from California (Mr. Takano) has offered a thoughtful amendment. We don't want any unjust actions taken against somebody because they are accused of something at one period of time or made a mistake and the courts found that that was not, in fact, something illegal. So I think he has the right intent. I think the gentleman's inclination is right. I would be happy to work with him on a standalone measure to achieve something similar, but I appreciate that. Mr. Chairman, I reserve the balance of my time.

Mr. McHENRY. Yes.

Mr. McHENRY. The second document is a letter to Members of the House of Representatives expressing opposition to each of the bills that was included in this overarching bill, including opposition to: H.R. 3621, H.R. 3614, H.R. 3618, H.R. 3622, H.R. 3642, from the United States Chamber of Commerce. Chamber of Commerce of the United States of America, January 27, 2020. To the Members of the U.S. House of Representatives: The U.S. Chamber of Commerce strongly opposes H.R. 3621, the ``Comprehensive Credit Act of 2020,'' which is composed of a number of bills regarding credit reporting that were reported out of the House Financial Services Committee in 2019. The Chamber has previously expressed opposition to each of the bills below which are now included as part of this comprehensive package: H.R. 3621, the ``Student Borrower Credit Improvement Act,'' would arbitrarily remove repayment information regarding student loans issued by private lenders. Reducing the quality of information in credit reports would in the aggregate reduce their utility, making it more difficult for consumers to access credit or other services. H.R. 3614, the ``Restricting Use of Credit Checks for Employment Decisions Act,'' would restrict an employer from initiating a credit check of an employee despite the fact that the Fair Credit Reporting Act requires an employee to first provide consent. This legislation would make it more difficult for employers to review the backgrounds of prospective employees, which would make it more difficult to hire for sensitive positions or would otherwise delay the hiring process. H.R. 3618, the ``Free Credit Scores for Consumers Act,'' would require credit bureaus to pay for and disclose for free a credit scoring model that is owned by a third party. Credit bureaus already provide ample information to consumers at no charge to assist them with understanding their credit standing. The legislation would make it more difficult for credit bureaus to provide for the accurate flow of useful information between consumers, furnishers, and entities that need to make informed decisions. H.R. 3622, the ``Restoring Unfairly Impaired Credit and Protecting Consumers Act,'' would reduce the quality of credit reports by arbitrarily reducing the term of adverse information and instituting redundant remediation mechanisms. Disrupting the utility of information in credit reports would make it more difficult for credit providers, and nonfinancial entities such as telecommunications companies and utilities to efficiently provide their services to consumers. H.R. 3642, the ``Improving Credit Reporting for All Consumers Act,'' would create dispute resolution requirements that are redundant to services voluntarily provided by credit bureaus and existing requirements under both the Fair Credit Reporting Act and a recent agreement among 38 State Attorneys General. Additionally, the legislation would frustrate the ability of credit bureaus to provide information to consumers by imposing new restrictions on the marketing of products intended to improve credit standing. H.R. 3629, the ``Clarity in Credit Score Formation Act of 2019,'' would make the CFPB, not lenders, the de facto underwriter of consumer loans and is redundant to existing supervisory and regulatory authority. The CFPB currently supervises larger participants in consumer reporting under its authority in the Dodd-Frank Act and has broad regulatory authority via enforcement of the Fair Credit Reporting Act. Interference in the proprietary models developed by credit bureaus and used by lenders would increase lenders' risk and decrease their ability to provide objective information. The Chamber urges you to oppose the Comprehensive Credit Act. Sincerely, Neil L. Bradley.

Mr. McHENRY. Mr. Chairman, I claim the time in opposition to the amendment.

Mr. McHENRY. Mr. Chairman, again, I still have concerns, but in the interest of due process, the direction of this amendment I think is a thoughtful one, and the gentleman's explanation is a strong explanation of his amendment. I would say in language such as no conviction, perhaps acquittal may be some better form of this, but this is something I am happy to work on if this ever gets to a conference committee, which I don't believe the bill will. But I am happy to engage with my colleague from California on the contents of this, and, as a separate measure, potentially, to work with him on that. Mr. Chairman, I yield back the balance of my time.

Mr. McHENRY. Mr. Chair, for the express purpose of this amendment, in legislative text it says that you cannot use a consumer credit report or the information therein to deny employment. And the gentleman in the very debate, Mr. Chair, said that he thinks some different standard. But that is not what this amendment does. This is a deeply-flawed amendment that has not been--I think it has been thought through, because the gentleman wants to ban every potential limitation on employment, even in a sensitive industry, even dealing with the elderly, even dealing with children; and I think that is way too far to the left and out of the mainstream. And this amendment is not conforming with the rhetoric that he used on the floor. In fact, it is much more far-reaching. But it is also quite fitting with the overall bill, because the overall bill is about socializing credit; and if you socialize credit, you can't use any form or factor, and so I think this is really problematic. If employers have a real fear that hiring an individual can jeopardize the integrity of an institution, for instance, a financial institution, or cause harm to the very people they are trying to care for, or share sensitive information on their customers, then they should have the opportunity to not hire those people that will cause harm or wreck our financial system. So this is a way-out-left amendment, and it is a way-out-left bill. So while I oppose it, I wish the gentleman well. And I wish that we could actually engage in some reasonable debate like I had with other Members. But I realize not all Members are the same. Mr. Chairman, I yield back the balance of my time.

Mr. McHENRY. Mr. Chair, I yield myself such time as I may consume. I include in the Record three documents in opposition to this bill. The first is a letter to Chairwoman Waters and to me from the Consumer Data Industry Association expressing their opposition to this bill. Consumer Data Industry Association, Washington, DC, January 23, 2020. Hon. Maxine Waters, Chairwoman, Hon. Patrick McHenry, Ranking Member, Committee on Financial Services, House of Representatives, Washington, DC. Dear Chairwoman Waters and Ranking Member McHenry: On behalf of the Consumer Data Industry Association (CDIA), I want to share our opposition to H.R. 3621, the ``Comprehensive CREDIT Act of 2020.'' This approximately 200- page bill would impose new costs to consumers and the economy and negatively impact credit underwriting standards. We request that House Members vote no when the bill is considered. As the trade association representing companies who provide consumer reporting services, we and our members strive to ensure that consumer credit reports are accurate, the information within them is protected and consumers are empowered to correct inaccurate information in a timely and straightforward fashion. Our member companies work constantly to improve the consumer reporting system by making technology and process improvements to enhance accuracy and improve the consumer experience. Overview The negative outcomes of H.R. 3621 would strike consumers, community banks, credit unions, automobile dealers, mortgage lenders, other non-bank lenders, data furnishers, employees and employers, insurers, property owners and consumer reporting agencies (CRAs). This legislation makes extensive and complicated changes to the consumer reporting industry and the rights and obligations established under the Fair Credit Reporting Act (FCRA), and will affect the entire credit allocation and risk management ecosystem; the bill is not solely targeted at CRAs. In previous instances when Congress considered major FCRA changes, extensive hearings were held in the House and Senate, featuring consumers, regulators, the consumer reporting industry, data contributors and end users of credit reports, such as banks and retailers. In the past, this has resulted in legislation that was supported by most stakeholders and bi-partisan Congressional majorities. The legislation in this Congress was taken up by Committee after only a single hearing last February, which was not focused on specific legislative issues. We believe proceeding without additional scrutiny is a mistake, given the bill's complexity and its impact. Consumer reports are a critical driver of economic growth and opportunity. Our economy relies on the ability of CRAs to interact with lenders, employers, insurers and others to enable consumers to access low-cost credit, employment opportunities and housing. The Federal Reserve noted, for example, that ``[a]vailable evidence indicates that [credit report] data and the credit-scoring models derived from them have substantially improved the overall quality of credit decisions and have reduced the costs of such decision-making. Almost certainly, consumers would receive less credit and the price of the credit they received would be higher, if not for the information provided by credit reporting companies.'' Current law provides consumers with a robust set of protections and rights. Ongoing debates regarding consumer privacy have shown that many, including consumer advocates, identify the FCRA as an example of effective consumer protection legislation and a model for other segments of the economy. In 2010, Congress passed the Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), which established the Consumer Financial Protection Bureau (CFPB). That law gave CFPB authority over much of the consumer reporting system, and since then, oversight by the Bureau has resulted in significant improvements within the consumer reporting system; CRAs, furnishers and users of credit reports have adopted multiple changes increasing consumer report accuracy and improving the consumer dispute process. If H.R. 3621 were to become law, consumers who pay their bills on time and manage their debts responsibly will pay more for credit than they do today. Consumers who have faced challenges with their credit will be worse off as well, as banks will lose the ability to accurately judge their credit history because key information will no longer appear on reports. The economy will suffer, as credit decisions will be based on fewer facts, and lenders will be forced to increase prices or reduce the amount of consumer credit available. The legislation to be considered was passed by the Committee on Financial Services as six bills, now embodied in H.R. 3621. We communicated our concerns in a letter on July 6, 2019. Those concerns continue to be valid; the following highlights some of the concerns we raised then.

Mr. McHENRY. Mr. Chairman, this amendment is more of the same. It prevents employers from identifying and fulfilling the needs of their companies. Now, use of a credit score, you would argue, is not perfect for every job, but there are certain cases where that would, in fact, be a reasonable thing and a reasonable limitation on employment; and I would ask the amendment sponsor if that is the case. Are there reasonable limitations that we could find here for the types of employment where a credit report may be helpful to an employer? I would ask the bill's sponsor, Mr. Cohen of Tennessee, who is here in the room, so your amendment says you cannot use the credit report for anything related to hiring; is that correct? I yield to the gentleman from Tennessee.

Mr. McHENRY. I have the right to close and I intend to do so.

Mr. McHENRY. Mr. Chairman, I yield 2\1/2\ minutes to the gentleman from Texas (Mr. Williams), my colleague from Weatherford.

Mr. McHENRY. Mr. Chairman, I reserve the balance of my time.

Mr. McHENRY. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, I submit for the Record page 114 of the bill, and I would highlight these sections, line 4, ``Maintenance of Credit Scores.'' ``Subsection A: In General. All consumer credit reporting agencies shall maintain the consumer's file credit scores relating to the consumer for a period of 2 years from the date on which such information is generated. ``Subsection B: Disclosure Only to Consumers. A past credit score maintained in a consumer's file pursuant to subparagraph A may only be provided to the consumer to which the credit score relates and may not be included in a consumer report or used as a factor in generating a credit score or educational credit score. ``Subsection C: Removal of the Past Credit Scores. A past credit score maintained in a consumer's file pursuant to subparagraph A shall be removed from the consumer's file after the end of the 2-year period described under subparagraph A.'' This is the section of the bill that says that your consumer credit report can only be 2 years old--your score. Now, the data can be longer, but your score can only use 2 years of past data. That is deeply problematic because, as we know, these things are more long-run occurrences. Creditworthiness doesn't happen overnight, nor do somebody's riskier habits happen overnight. So for a 2-year period, we have not seen any testimony why 2 years is sufficient. The current industry standard is much longer than that, but each different user of this credit information can determine for themselves what that appropriate time is, and that is not mandated by current law. So I find this troublesome, and problematic, and riskier than what we currently have in the law; and that is one of the components of this bill that I oppose. There are numerous other examples, but I know we will have more debate and I will be able to bring up those exact details as those on the other side tout the so-called benefits. Mr. Chairman, I reserve the balance of my time.