House Financial Services Task Force Holds Hearing on Role of Big Data in Financial Services
Last week, in a hearing convened by the House Financial Services Committee’s Task Force on Financial Technology, members of the committee discussed the increased use of big data—the immense amount of consumer information collected by institutions and businesses—in the financial services industry. This has led to the development of new services and products, as well as the increased participation of technological companies in the financial sphere.
At present, the Gramm-Leach-Bliley Act (GLBA) and the Fair Credit Reporting Act (FCRA) are the two main laws protecting big data, according to the Committee Memorandum. The former enforces data protection on financial businesses while the latter regulates the collection of data for credit reporting, but there are clarification issues with the rise of technological businesses entering the financial industry.
The Committee proposed three draft pieces of legislation for consideration to help resolve issues of privacy and discrimination. The Safeguarding Non-bank Consumer Information Act clarifies GLBA’s privacy provisions and gives the Bureau of Consumer Financial Protection authority over the safeguards rule. The Financial Information Data Modernization Act clarifies “non-financial institutions” and “financial data” for the protection of the consumer under GLBA. The No Biometric Barriers to Housing Act of 2019 aims to stop discrimination by prohibiting the use of biometric data analysis in public housing.
Witnesses at the hearing included Ms. Lauren Saunders, Associate Director of the National Consumer Law Center; Dr. Seny Kamara, PhD., Professor of Computer Science at Brown University and Chief Scientist at Aroki Systems; Dr. Christopher Gillard, PhD., Professor of English at Macomb Community College and Digital Pedagogy Lab Advisor; Mr. Don Cardinal, Managing Director at Financial Data Exchange; and Mr. Duane Pozza, Partner at Wiley Rein.