Providing for Congressional Disapproval of the Rule Submitted By the Bureau of Consumer Financial Protection Relating to ``Small Business Lending Under the Equal Credit Opportunity Act (Regulation B)''
Floor Speech
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Mr. WILLIAMS of Texas. Madam Speaker, pursuant to House Resolution 891, I call up the joint resolution (S.J. Res. 32) providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Bureau of Consumer Financial Protection relating to ``Small Business Lending Under the Equal Credit Opportunity Act (Regulation B)'', and ask for its immediate consideration in the House.
The Clerk read the title of the joint resolution.
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Mr. WILLIAMS of Texas. Madam Speaker, I yield myself such time as I may consume.
Madam Speaker, I rise today in support of this joint resolution of disapproval. We must overturn the CFPB's small business lending rule to ensure small businesses across America, which are the backbone of our country, have continued access to affordable credit to support and grow our economy.
Access to affordable credit is key to ensuring communities across America remain vibrant. Unfortunately, the CFPB's small business lending rule undermines the goal of affordable and available credit, which I think we all should share.
Here is why. First, the CFPB's rule is overly broad. It will require lenders to collect massive amounts of data whenever a small business owner applies for credit. Most of the information is unnecessary to make a fair, equitable, safe, and sound loan. Requiring lenders to provide the information infringes on small business owners' rights to privacy about their personal and business information when applying for credit.
Second, the CFPB's rule is burdensome. Community banks and credit unions across America account for the majority of small business lending. They are doing their part. Despite claims from my colleagues across the aisle, this rule does not go after big banks. It will have the biggest impact on the small community financial institutions already operating under the thinnest of margins because of runaway inflation and increased interest rates through the Federal Reserve--in general, the Biden economy.
The rule also discourages banks and credit unions from expanding their lending portfolios. They might simply decide that the droves of new compliance officers they would have to hire to comply with this onerous rule would simply not be worth it, and Main Street is hammered again.
The CFPB Director says he is trying to be sensitive to the needs of small community financial institutions, oftentimes advocating for relationship banking. However, in the rule, CFPB sets the transaction threshold at an incredibly low 100 loans in the preceding 2 calendar years. This means the smallest of banks, small businesses, and their owners will be the ones to bear the brunt of the unnecessary data collection, and Main Street is hammered again.
Third, the rule will be difficult to implement. The rule itself is nearly 900 pages and requires lenders to report 81 data fields. Developing compliance systems to achieve this will be extremely costly for firms, which takes resources away from actually lending to small businesses, and Main Street is hammered again.
The timeline for implementation is also insufficient for lenders to develop the necessary systems to comply with such a complex and burdensome regulation. Each hour a lender spends on the overly broad data collection demanded by the rule is an hour not devoted to ensuring credit is available and affordable for small businesses, and Main Street is hammered again.
Finally, it is unclear what the Bureau intends to do with its exceedingly expansive data demands. What we do know is the CFPB plans to post the data publicly on the CFPB's website. This is concerning, given the Bureau's alarming record of facilitating the naming and shaming of companies whose business activities progressive activists want to attack, adding to the concerns of the CFPB's abysmal track record of protecting the highly sensitive data it already collects.
In fact, back in February of this year, there was a major unauthorized data breach by a CFPB employee, which included personally identifiable information and confidential supervisory information. Therefore, why should we ever trust them to protect sensitive information of small business owners this time around?
To sum it up, the rule is backward-looking, anti-small business, anti-capitalism, anti-competition, anti-free markets, and anti-risk and reward.
It is critical that we pass this resolution to overturn this reckless CFPB rule to protect small business access to the credit needed to continue to innovate and grow our economy. A new idea while we are at it: Let's put people back to work again.
Madam Speaker, I urge my colleagues to support this resolution, and I reserve the balance of my time.
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Mr. WILLIAMS of Texas. Madam Speaker, I yield 1 minute to the gentlewoman from the great State of Texas (Ms. De La Cruz).
Ms. De LA CRUZ. Madam Speaker, I thank the gentleman for yielding.
I rise today to express my strong support for S.J. Res. 32, a resolution disproving of the CFPB's overreaching and burdensome rule under section 1071 of the Dodd-Frank Act.
This rule is nearly 900 pages long. It imposes onerous data collection requirements on small business lenders in places like south Texas.
This regulatory overreach is not just impractical; it directly threatens the lifeline of America's economy--our great small businesses.
Mom-and-pop shops are the backbone of our communities and need access to create, to grow, and to thrive. This rule, with its misaligned definitions and excessive demands, will only hinder their access to the necessary financial resources.
By supporting this resolution, we stand for common sense, for small businesses, for community banks, for local families, and for a regulatory environment that fosters economic growth.
I urge my colleagues to join me in supporting this resolution to safeguard the health of our Nation's economy.
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Mr. WILLIAMS of Texas. Madam Speaker, I yield 2 minutes to the gentleman from the great State of Pennsylvania (Mr. Meuser).
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Mr. WILLIAMS of Texas. Madam Speaker, I yield 4 minutes to the gentleman from the great State of Arkansas (Mr. Hill).
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Mr. WILLIAMS of Texas. Madam Speaker, I yield 1 minute to the gentleman from the great State of Nebraska (Mr. Flood).
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Mr. WILLIAMS of Texas. Madam Speaker, I yield 4 minutes to the gentleman from Kentucky (Mr. Barr).
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Mr. WILLIAMS of Texas. Madam Speaker, I yield an additional 30 seconds to the gentleman from Texas.
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Mr. WILLIAMS of Texas. Madam Speaker, I yield 1 minute to the gentleman from North Carolina (Mr. McHenry), the chairman of the Financial Services Committee.
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Mr. WILLIAMS of Texas. Madam Speaker, may I inquire as to the time remaining.
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Mr. WILLIAMS of Texas. Madam Speaker, I yield 2 minutes to the gentlewoman from California (Mrs. Kim).
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Mr. WILLIAMS of Texas. Madam Speaker, as my colleagues and I have stated today, my biggest fear is that many lenders may decide to fully exit small business lending due to the overly burdensome collection requirements, or because they don't want to put their small business customers in an uncomfortable situation.
I do not believe this is the outcome Congress, or the CFPB, intended with the implementation of this section of Dodd-Frank. However, I know, as a small business owner myself, that if this rule goes into effect it will not bode well for small businesses seeking the credit needed to grow and support their communities. That is the bottom line.
We need to help small businesses. We need to help them create jobs but also to create net worth among their employees.
Madam Speaker, I urge my colleagues to support this resolution, and I yield back the balance of my time.
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