,,ib ,union ,calendar ,no4 #agf #aaith ,,congress #ast ,session ,h4 ,r4 #idj ,report ,no4 #aai-baf ,,in ,,the ,,house ,,of ,,representatives ,february #d1 #bjbe,mr4 ,hill of ,arkansas 7for himself1 ,mr4 ,meuser1 ,mrs4 ,wagner1 ,mr4 ,huizenga1 ,mr4 ,timmons1 ,mr4 ,moore of ,north ,carolina1 and ,mr4 ,williams of ,texas7 introduced the following bill2 which was referred to the ,committee on ,financial ,services ,july #be1 #bjbe;,additional sponsors3 ,mr4 ,haridopolos1 ,mr4 ,sessions1 ,mr4 ,david ,scott of ,georgia1 and ,mr4 ,fields ,july #be1 #bjbe,reported with an amendment1 committed to the ,committee of the ,whole ,house on the ,state of the ,union1 and ordered to be printed,strike out all after the enacting clause and insert the part printed in italic,for text of introduced bill1 see copy of bill as introduced on ,february #d1 #bjbe ,a ,,bill ,to amend the ,federal ,financial ,institutions ,examination ,council ,act of #aigh to improve the examination of depository institutions1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,fair ,audits and ,inspections for ,regulators' ,exams ,act or the ,,fair ,exams ,act4 #b4 ,timeliness of examinations and examination reports ,the ,federal ,financial ,institutions ,examination ,council ,act of #aigh 7#ab ,u4,s4,c4 #ccja et seq47 is amended by adding at the end the following3 #ajab4 ,timeliness of examinations and examination reports 7a7 ,timeliness of examinations ,a ,federal financial institutions regulatory agency shall complete any examination of a financial institution within #bgj days of commencing the examination1 except that such period may be extended by the ,federal financial institutions regulatory agency by providing written notice to the financial institution describing with particularity the reasons that a longer period is needed4 7b7 ,final examination report ,a ,federal financial institutions regulatory agency shall provide a final examination report to a financial institution not later than #ij days after the later of-- 7#a7 the exit interview for an examination of the institution2 or 7#b7 the provision of additional material information by the institution relating to the examination4 7c7 ,exit interview requirement ,within #cj days of completing an examination1 a ,federal financial institutions regulatory agency shall conduct an exit interview with the financial institution's senior management1 except that such period may be extended by the ,federal financial institutions regulatory agency by providing written notice to the institution and the ,board describing with particularity the reasons that a longer period is needed to complete the exit interview4 7d7 ,examination materials ,upon the request of a financial institution1 the ,federal financial institutions regulatory agency shall include with the final report an appendix listing all examination or other factual information relied upon by the agency in support of a material supervisory determination4 4 #c4 ,timeliness of required permission1 regulatory1 and reporting guidance ,the ,federal ,financial ,institutions ,examination ,council ,act of #aigh 7#ab ,u4,s4,c4 #ccja et seq471 as amended by section #b1 is further amended by adding at the end the following3 #ajac4 ,timeliness of required permission1 regulatory1 and reporting guidance 7a7 ,request for permission or guidance ,with respect to an action that a financial institution is taking or is intending to take1 the financial institution may request a written determination by the applicable ,federal financial institutions regulatory agency of-- 7#a7 the agency's non-objection to the financial institution conducting a particular activity2 7#b7 the agency's interpretation of a law or regulation2 and 7#c7 the agency's interpretation of generally accepted accounting principles or accounting objectives1 standards1 and requirements4 7b7 ,contents of request ,a request made under subsection 7a7 shall be in writing and contain-- 7#a7 the nature of the request2 7#b7 applicable facts relating to the matter2 7#c7 applicable law1 regulation1 or generally accepted accounting principles relating to the matter2 and 7#d7 a summary of the request4 7c7 ,response to request ,a ,federal financial institutions regulatory agency receiving a request under subsection 7a7 shall1 not later than #cj days after receiving the request-- 7#a7 provide the financial institution making the request with written notification that the agency received the request and stating whether the request contains all of the information required under subsection 7b72 and 7#b7 if the request does not contain all of the information required under subsection 7b71 provide the financial institution with an explanation of what information is missing4 7d7 ,providing missing information ,if a ,federal financial institutions regulatory agency informs the financial institution under subsection 7c7 that the request does not contain all the information required under subsection 7b71 the financial institution may provide the missing information to the ,federal financial institutions regulatory agency during the #cj-;day period beginning on the date the financial institution receives the explanation of the missing information under subsection 7c74 7e7 ,determination ,a ,federal financial institutions regulatory agency receiving a request under subsection 7a7 shall make a determination on the request and provide the financial institution with a written notice of such determination-- 7#a7 if the initial request contains the information required under subsection 7b71 not later than the end of the #fj-;day period beginning on the date the ,federal financial institutions regulatory agency notifies the financial institution of the receipt of the request under subsection 7c72 or 7#b7 if the initial request does not contain the information required under subsection 7b71 but the financial institution provides the missing information during the #cj-;day period described under subsection 7d71 not later than the end of the #fj-;day period beginning on the date such missing information is provided2 or 7#c7 if the initial request does not contain the information required under subsection 7b71 and the financial institution does not provide the missing information during the #cj-;day period described under subsection 7d71 not later than the end of the #fj-;day period beginning on the end of such #cj-;day period4 7f7 ,reports and publication ,each ,federal financial institutions regulatory agency shall1 within #abj days after making a determination under paragraph 7#e71 publish a summary of the determination on the public website of the ,federal financial institutions regulatory agency4 ,each ,federal financial institutions regulatory agency shall redact any confidential supervisory information about the financial institution1 any identifying facts about the financial institution1 and any sensitive personally identifiable information1 and anonymize any un-redacted information that could1 individually or in the aggregate1 identify the financial institution4 4 #d4 ,office of ,independent ,examination ,review 7a7 ,in general ,the ,federal ,financial ,institutions ,examination ,council ,act of #aigh 7#ab ,u4,s4,c4 #ccja et seq471 as amended by section #c1 is further amended by adding at the end the following3 #ajad4 ,office of ,independent ,examination ,review 7a7 ,establishment ,there is established in the ,council an ,office of ,independent ,examination ,review 7the ,office74 7b7 ,board of ,independent ,examination ,review 7#a7 ,in general ,the head of the ,office shall be the ,board of ,independent ,examination ,review1 which shall be comprised of #c members1 appointed by the ,president1 by and with the advice and consent of the ,senate4 7#b7 ,qualifications ,the ,president shall appoint the #a member of the ,board from each of the following classes of individuals3 7,a7 ,individuals who have been employed by a ,federal financial institutions regulatory agency4 7,b7 ,individuals who-- 7i7 are a licensed attorney or a certified public accountant authorized to practice under the laws of a ,state1 the ,district of ,columbia1 or a territory of the ,united ,states2 7ii7 have either academic or private sector experience2 7iii7 have relevant work-related experience in consumer affairs or compliance with consumer protection laws with respect to financial institutions2 and 7iv7 are not1 and were not during the previous #aj-year period1 employed by a ,federal banking agency1 a ,federal reserve bank1 or the ,national ,credit ,union ,administration4 7,c7 ,individuals-- 7i7 with at least #aj years private sector financial services senior management-level experience2 and 7ii7 recommended by-- 7,i7 an insured depository institution2 7,,ii7 an insured credit union2 or 7,,iii7 a trade association for such institutions or credit unions4 7#c7 ,prohibition on certain individuals serving as a ,board member ,the ,president may not appoint an individual as a member of the ,board if the individual-- 7,a7 is1 or was during the previous #b-year period1 employed by a ,federal financial institutions regulatory agency or a ,federal reserve bank2 7,b7 is1 or was during the previous #b-year period1 employed by a financial institution2 or 7,c7 is reporting1 or was reporting in the past #e years1 directly or indirectly to a ,federal financial institutions regulatory agency official who makes material supervisory determinations4 7#d7 ,consultation ,in appointing members of the ,board1 the ,president shall consult with the ,federal financial institutions regulatory agencies and financial institutions4 7#e7 ,term 7,a7 ,in general ,each member of the ,board shall serve for a term of #c years4 7,b7 ,term limitation ,no individual may serve more than #b full terms on the ,board4 7#f7 ,political affiliation ,not more than #b members of the ,board shall be members of the same political party4 7#g7 ,quorum 7,a7 ,in general #c members of the ,board shall constitute a quorum4 7,b7 ,initial quorum ,during the #f-month period beginning on the date of enactment of this section1 #a member of the ,board shall constitute a quorum until the ,board has #c members4 7c7 ,staffing ,the ,board is authorized to hire staff to support the activities of the ,office of ,independent ,examination ,review4 ,one-fifth of the costs and expenses of the ,office1 including the salaries of its employees1 shall be paid by each of the ,federal financial institutions regulatory agencies4 ,annual assessments for such share shall be levied by the ,council based upon its projected budget for the year1 and additional assessments may be made during the year if necessary4 7d7 ,duties ,the ,board shall-- 7#a7 receive and1 at the discretion of the ,board1 investigate complaints from financial institutions1 their representatives1 or another entity acting on behalf of such institutions1 concerning examinations1 examination practices1 or examination reports2 7#b7 hold meetings1 at least once every three months and in locations designed to encourage participation from all sections of the ,united ,states1 with financial institutions1 their representatives1 or another entity acting on behalf of such institutions1 to discuss examination procedures1 examination practices1 or examination policies2 7#c7 review examination procedures of the ,federal financial institutions regulatory agencies to ensure that the written examination policies of those agencies are being followed in practice and adhere to the standards for consistency2 7#d7 conduct a continuing and regular program of examination quality assurance for all examination types conducted by the ,federal financial institutions regulatory agencies2 7#e7 carry out an independent review of any supervisory appeal initiated under section #ajae2 and 7#f7 report annually to the ,committee on ,financial ,services of the ,house of ,representatives1 the ,committee on ,banking1 ,housing1 and ,urban ,affairs of the ,senate1 and the ,council1 on the reviews carried out pursuant to paragraphs 7#c7 and 7#e71 including compliance with the requirements set forth in section #ajac regarding timeliness of examination reports1 and the ,board's recommendations for improvements in examination procedures1 practices1 and policies4 7e7 ,confidentiality ,the ,board and the ,council shall keep confidential-- 7#a7 all meetings1 discussions1 and information provided by financial institutions and ,federal financial institutions regulator agencies that involve confidential supervisory information or privileged information2 7#b7 all information and communications exchanged between a financial institution and the ,office of ,independent ,examination ,review2 and 7#c7 all information and communications exchanged between a ,federal financial institutions regulator agency and the ,office of ,independent ,examination ,review4 4 7b7 ,definitions ,section #ajjc of the ,federal ,financial ,institutions ,examination ,council ,act of #aigh 7#ab ,u4,s4,c4 #ccjb7 is amended-- 7#a7 in paragraph 7#b71 by striking and at the end2 and 7#b7 by adding at the end the following3 7#d7 the term ,board means the ,board of ,independent ,examination ,review established under section #ajad7;b72 7#e7 the term material supervisory determination has the meaning given such term in section #cji7;c7 of the ,riegle ,community ,development and ,regulatory ,improvement ,act of #aiid2 7#f7 the term insured depository institution has the meaning given that term in section #c of the ,federal ,deposit ,insurance ,act2 and 7#g7 the term insured credit union has the meaning given that term in section #aja of the ,federal ,credit ,union ,act4 4 #e4 ,right to independent review of material supervisory determinations ,the ,federal ,financial ,institutions ,examination ,council ,act of #aigh 7#ab ,u4,s4,c4 #ccja et seq471 as amended by section #d1 is further amended by adding at the end the following3 #ajae4 ,right to independent review of material supervisory determinations 7a7 ,in general ,a financial institution shall have the right to obtain an independent review1 as described in this section1 of a material supervisory determination contained in a final report of examination4 7b7 ,notice 7#a7 ,timing ,a financial institution seeking review of a material supervisory determination under this section shall file a written notice with the ,board within #fj days after receiving the final report of examination that is the subject of such review4 7#b7 ,extension ,the institution may file a written request with the ,board for an extension of the #fj-;day time period described under paragraph 7#a71 which shall state good cause for granting the extension4 ,such request shall be granted in the sole discretion of the ,board4 7#c7 ,identification of determination ,the written notice shall-- 7,a7 identify the material supervisory determination that is the subject of the requested independent examination review2 7,b7 state the reasons why the institution believes that the material supervisory determination is incorrect or should otherwise be modified2 and 7,c7 include-- 7i7 a clear and complete statement of all relevant facts and issues2 7ii7 all arguments that the institution wishes to present2 and 7iii7 all relevant and material documents in the possession of the institution that the institution wishes to be considered4 7#d7 ,information made available to institution ,an institution seeking an appeal of a material supervisory determination may1 not later than #g days after receiving the final examination report1 request that the ,federal financial institutions regulatory agency that made the material supervisory determination provide the institution with all examination and factual information relied upon by the agency in making the material supervisory determination4 ,the agency shall provide that information to the institution not later than #ad days after receiving the request4 7c7 ,determination2 right to hearing 7#a7 ,in general ,the ,board shall-- 7,a7 determine the merits of the appeal on the record1 including whether the material supervisory determination being appealed should be upheld1 canceled1 or modified2 or 7,b7 at the election of the financial institution1 conduct a hearing1 which shall take place not later than #fj days after the petition for review is received by the ,board4 7#b7 ,right to obtain testimony ,a financial institution electing for a hearing under paragraph 7#a77;,b7 shall have the right the obtain testimony under oath from agency employees and obtain documents and other evidence at the hearing1 or in advance of the hearing1 according to procedures instituted by the ,board consistent with those set forth under sections #eef and #eeg of title #e1 ,united ,states ,code4 7#c7 ,basis of decision ,the ,board shall issue a written decision based upon the record of the examination1 supplemented by the record established at any hearing4 7#d7 ,standard of review ,the ,board's review of a material supervisory determination being appealed under this subsection shall be de novo1 and the ,board shall not defer to the opinions of the examiner or agency1 but shall independently determine the appropriateness of the agency's material supervisory determination based upon the relevant statutes1 regulations1 other appropriate guidance1 and the evidentiary record4 7d7 ,final decision ,a decision by the ,board on an independent review under this section shall-- 7#a7 be made not later than #fj days after the record has been closed2 and 7#b7 be deemed final agency action and shall bind the agency whose supervisory determination was the subject of the review and the financial institution requesting the review4 7e7 ,right to judicial review ,a financial institution shall have the right to petition for review of a ,board determination made under subsection 7d7 by filing a petition for review not later than #fj days after the date on which the decision is made in the ,united ,states ,court of ,appeals for the ,district of ,columbia ,circuit or the ,circuit in which the financial institution is located4 7f7 ,referral of violations ,if the ,board1 in carrying out this section1 determines that a financial institution has violated a law or regulation1 the ,board shall refer such determination to the applicable ,federal financial institutions regulatory agency4 7g7 ,annual report 7#a7 ,in general ,the ,board shall report annually to the ,committee on ,financial ,services of the ,house of ,representatives1 the ,committee on ,banking1 ,housing1 and ,urban ,affairs of the ,senate1 and the ,council on actions taken under this section1 including the types of issues that the ,board has reviewed and the results of those reviews1 including information on each final determination with respect to a material supervisory determination4 7#b7 ,confidentiality ,in reporting under paragraph 7#a71 the ,board shall redact information about individual financial institutions and any confidential or privileged information shared by financial institutions1 and shall anonymize any un-redacted information that could1 in the aggregate1 identify a financial institution4 7h7 ,retaliation prohibited 7#a7 ,in general ,a ,federal financial institutions regulatory agency may not-- 7,a7 retaliate against a financial institution1 including service providers1 or any institution-affiliated party1 for exercising appellate rights under this section2 or 7,b7 delay or deny any agency action that would benefit a financial institution or any institution-affiliated party on the basis that an appeal under this section is pending under this section4 7#b7 ,retaliation ,for purposes of this subsection1 retaliation includes delaying consideration of1 or withholding approval of1 any request1 notice1 or application that otherwise would have been approved1 but for the exercise of a financial institution's rights under this section4 7i7 ,rulemaking ,the ,board shall issue rules to establish procedures for hearings described under this section1 including that-- 7#a7 a financial institution may appear at the hearing personally or through counsel2 7#b7 a financial institution may provide an oral and written presentation at the hearing2 7#c7 the ,board may ask questions of any person participating in the hearing2 7#d7 the hearing may not involve-- 7,a7 a cross-examination2 or 7,b7 discovery2 7#e7 the hearing shall not be governed by the ,federal ,rules of ,evidence2 and 7#f7 the ,board shall have a verbatim transcript of the hearing prepared4 7j7 ,safety and soundness exception ,the appeal of a material supervisory determination by a financial institution under this section shall not affect the authority of a ,federal financial institutions regulatory agency to enforce the material supervisory determination or to take an action based on such material supervisory determination1 if the ,federal financial institutions regulatory agency determines that such enforcement or action is necessary to ensure the safety and soundness of the financial institution4 4 #f4 ,additional amendments 7a7 ,regulator appeals process1 ombudsman1 and alternative dispute resolution 7#a7 ,in general ,section #cji of the ,riegle ,community ,development and ,regulatory ,improvement ,act of #aiid 7#ab ,u4,s4,c4 #dhjf7 is amended-- 7,a7 in the heading1 by striking ,,regulatory ,,appeals ,,process1 ,,ombudsman1 and inserting ,,ombudsman 7and by conforming the item relating to such section in the table of contents accordingly72 7,b7 by striking subsections 7a71 7b71 and 7c72 7,c7 by redesignating subsections 7d71 7e71 7f71 and 7g7 as subsections 7a71 7b71 7c71 and 7d71 respectively2 7,d7 in subsection 7b71 as so redesignated-- 7i7 in paragraph 7#b7-- 7,i7 in subparagraph 7,b71 by striking and at the end2 7,,ii7 in subparagraph 7,c71 by striking the period and inserting 2 and2 and 7,,iii7 by adding at the end the following3 7,d7 ensure that appropriate safeguards exist for protecting any party from retaliation by any agency for exercising rights under this subsection4 2 and 7ii7 by adding at the end the following3 7#f7 ,retaliation ,for purposes of this subsection1 retaliation includes delaying consideration of1 or withholding approval of1 any request1 notice1 or application that otherwise would have been approved1 but for the exercise of a financial institution's rights under this section4 2 and 7,e7 in paragraph 7#a77;,a7 of subsection 7c71 as so redesignated-- 7i7 in clause 7ii71 by striking 2 and and inserting a semicolon2 7ii7 in clause 7iii71 by striking 2 and and inserting a semicolon2 and 7iii7 by adding at the end the following3 7iv7 any issue specifically listed in an exam report as a matter requiring attention by the institution's management or board of directors2 and 7v7 any suspension or removal of an institution's status as eligible for expedited processing of applications1 requests1 notices1 or filings on the grounds of a supervisory or compliance concern1 regardless of whether that concern has been cited as a basis for a material supervisory determination or matter requiring attention in an examination report1 provided that the conduct at issue did not involve violation of any criminal law2 and 4 7#b7 ,effect ,nothing in this subsection affects the authority of an appropriate ,federal banking agency or the ,national ,credit ,union ,administration ,board to take enforcement or other supervisory action4 7b7 ,federal ,credit ,union ,act ,section #bje7;j7 of the ,federal ,credit ,union ,act 7#ab ,u4,s4,c4 #aghe7;j77 is amended by inserting the ,bureau of ,consumer ,financial ,protection1 before the ,administration each place that term appears4 7c7 ,federal ,financial ,institutions ,examination ,council ,act ,the ,federal ,financial ,institutions ,examination ,council ,act of #aigh 7#ab ,u4,s4,c4 #ccja et seq471 as amended by sections #b through #d of this ,act1 is further amended-- 7#a7 in section #ajjc 7#ab ,u4,s4,c4 #ccjb7-- 7,a7 by striking paragraph 7#a7 and inserting the following3 7#a7 the term ,federal financial institutions regulatory agencies-- 7,a7 means the ,office of the ,comptroller of the ,currency1 the ,board of ,governors of the ,federal ,reserve ,system1 the ,federal ,deposit ,insurance ,corporation1 and the ,national ,credit ,union ,administration2 and 7,b7 includes the ,bureau of ,consumer ,financial ,protection for purposes of sections #ajab through #ajae2 2 and 7,b7 in paragraph 7#c71 by striking the semicolon at the end and inserting 1 except that for purposes of sections #ajab through #ajae1 the term financial institution does not include a credit union that is not an insured credit union22 7#b7 in section #ajjd7;a77#d7 7#ab ,u4,s4,c4 #ccjc71 by striking ,consumer ,financial ,protection ,bureau and inserting ,bureau of ,consumer ,financial ,protection2 and 7#c7 in section #ajje 7#ab ,u4,s4,c4 #ccjd7-- 7,a7 by striking ,one-fifth and inserting ,one-fourth2 and 7,b7 by inserting described under section #ajjc7a77;,a7 after agencies4 ,july #be1 #bjbe,reported with an amendment1 committed to the ,committee of the ,whole ,house on the ,state of the ,union1 and ordered to be printed