Rep. García Introduces Bills Targeting Tech Companies Pursuing Financial Services

U.S.  Rep. Jesus “Chuy” García (D-Ill.), who represents parts of Chicago and its suburbs, has drafted three bills aimed at keeping big tech companies like Facebook, Google, and Amazon out of the financial services industry. He says that his plan is to prohibit monopolies that cause income inequality, telling POLITICO that these tech giants “have repeatedly used their access to users’ data to manipulate market outcomes and increase their economic dominance.”

The first bill, titled the Keep Big Tech Out of Finance Act, would prohibit tech companies from creating exclusive digital currencies, like Facebook has announced with their plans to launch Libra. The next would stop banks from owning commodities and also block tech companies from collecting 5 percent of their earnings from financial activity, affirming the line between banking and commerce. The last bill would require non-financial firms (“industrial loan companies”) to undergo more strict regulatory oversight for banking units when established with a state charter.

The banking industry has long been opposed to this exemption. Greg Baer, CEO of the Bank Policy Institute, told Politico that “tech firms [attempt] to exploit loopholes to gain access to consumers’ financial data in addition to personal data that they already control.” The Independent Community Bankers of America has also signaled that they may support the effort.