WASHINGTON (12/10/15)--Votes from the House Financial Services Committee Wednesday will help make consumer data safer, said CUNA President/CEO Jim Nussle. The committee passed two bills that have strong CUNA support, the Data Security Act of 2015 (H.R. 2205) and the National Credit Union Administration Budget Transparency Act (H.R. 2287) during its markup.
H.R. 2205 passed the committee with a 46-9 vote and H.R. 2287 passed with a 40-16 vote.
“The House Financial Services Committee voted today to protect consumers by strengthening our country’s data security laws. The CUNA-backed Data Security Act will prevent breaches by providing a higher standard for all who accept payments, better notification procedures and a federal law that will replace the cumbersome patchwork of state laws,” said CUNA President/CEO Jim Nussle. “We thank the members of the committee who voted in favor of protecting the American consumer, and urge House leadership to quickly bring the legislation to the House floor.
“Until retailers adhere to the same standards that financial institutions are beholden to, millions of consumers will remain at risk,” Nussle added.
H.R. 2205 would:
The bill also recognizes that credit unions and other financial institutions already have strict data security standards set forth under the Gramm-Leach-Bliley Act, and thus does not impose any additional standards on them.
“We need to stop these data breaches. The way to do that is assign responsibility and cost to the entities best positioned to stop the data breaches. That is, the entities holding the information,” said Rep. Brad Sherman (D-Calif.).
Rep. Ed Royce (R-Calif.), speaking in support of the bill, cited a number of costs borne by credit unions in his district due to several data breaches.
Data security legislation with more stringent security standards for merchants has long been a top advocacy priority for CUNA. CUNA’s efforts to support such legislation only intensified after the Target data breach of 2013, which exposed millions of cards and cost credit unions at least $30 million.
CUNA issued an action alert this week to engage credit unions members in support of H.R. 2205, urging them to contact their legislators.
The Data Security Act of 2015 has a Senate equivalent bill, S. 961, introduced by Sens. Tom Carper (D-Del.) and Roy Blunt (R-Mo.) in April.
The European Union has agreed on new rules for its 28 nations, rules that oblige businesses to strengthen cybersecurity defenses and force companies to report cyberattacks, according to a report in Bloomberg.
H.R. 2287, also strongly supported by CUNA, would require the NCUA to publish its budget in the Federal Register, accept comments on the budget and address those comments.
“The NCUA is a little bit unusual. It is funded entirely by the credit unions that it oversees, and those credit unions represent their members,” said Rep. Mick Mulvaney (R-S.C.), one of the bill’s sponsors. “So this is one of those unique situations where all these not-for-profit entities are contributing to their own regulatory budget, and it would be nice if they actually had a chance to defend their members’ interests and look at the budget.
CUNA said the budget bill would promote more efficient use of NCUA funds, which primarily come from credit unions, and would increase transparency and accountability at the agency, thereby fulfilling its mission.
There is a provision in the Financial Regulatory Improvement Act of 2015 (S. 1484) that calls for the NCUA to publish its budget and hold a public hearing to accept comments on the draft budget.
The text of S. 1484 has been included in the omnibus appropriations bill being currently being discussed by the House and Senate conference committee.