WASHINGTON—The House Financial Services Committee’s Task Force on Financial Technology recently held its first-ever hearing on the fintech industry.
The hearing was titled “Overseeing the Fintech Revolution: Domestic and International Perspectives on Fintech Regulation.”
The Committee created the task force to explore the use of alternative data in loan underwriting, payments, big data, and data privacy challenges. The hearing’s witness panel consisted of high-ranking innovation officials across various agencies and associations, including the CFPB, OCC, SEC, CSBS, and the U.K.’s Financial Conduct Authority.
Among other things, the hearing discussed whether digital currency is considered a security, the OCC’s special purpose national bank charter, and the U.K.’s regulatory sandbox approach, Lexology reported.
SEC representative Valerie Szczepanik told the committee she believes the SEC has been “quite clear” with regard to initial coin offerings, noting that “each digital asset is its own animal. It has to be examined on its facts and circumstances to determine what in fact it is. It could be a security, it could be a commodity, it could be something else. So we stand ready to provide kind of guidance to folks if they want to come and talk to us. We encourage them to come talk to us before they do anything so they can get the benefit of our guidance.”
Concerns Expressed
While much of the OCC special purpose bank charter discussion focused on a social media’s plan to launch its own virtual currency, CSBS representative Charles Clark emphasized “state regulators oppose the special purpose charter because it lacks statutory authority,” adding it should be up to Congress to decide whether the OCC can regulate non-bank entities. Clark noted that a federal system would create an unlevel playing field compared to a state system where “a small company can enter the system, scale up, and be competitive with an innovative idea,” Lexology said.