Washington, D.C. — Twenty-eight Members of the House of Representatives, led by Rep. Darrell Issa (R-CA), have reintroduced the Financial Transparency Act (H.R. 1530). If enacted, the Financial Transparency Act would be the nation’s first RegTech law. This morning the lead sponsors of the Financial Transparency Act, Reps. Darrell Issa, Carolyn Maloney, and Randy Hultgren took the stage at the Data Coalition’s third annual Financial Data Summit to make their case.
The bill would modernize the U.S. financial regulatory reporting process from unstructured documents into fully searchable, standardized, and machine-readable data. The bipartisan proposal directs the eight major U.S. financial regulatory agencies to adopt consistent data fields and formats for the information that they already collect from the private sector under existing securities, commodities, and banking laws.
“Passing the Financial Transparency Act would be a milestone for data transparency and the openness of public information,” said Congressman Darrell Issa (R-CA). “What my previous legislation, the DATA Act, is doing to open up government spending through online, searchable and freely accessible data, the Financial Transparency Act would do for financial reporting information. Financial reporting often relies on cumbersome – and duplicative – paper or PDF reports that make it difficult for regulators and the public to track down the information they need. By updating the process to an open data standard for the information already reported to the nation’s eight financial regulatory agencies, we’ll be able to reduce regulatory burdens on businesses, give the public and investors better access to information, and boost our ability to find, and prevent, instances of fraud.”
“The U.S. financial regulatory system is outdated, duplicative and inefficient,” said Hudson Hollister, Executive Director of the Data Coalition. “The Financial Transparency Act will use technology to modernize it. Under this bill, regulators will eliminate document-based financial filings and adopt open, structured data formats for all filings. When government information is reported and published as data instead of documents – industry, government and investors all win.”
What the Financial Transparency Act does:
- Directs the eight major U.S. financial regulatory agencies to adopt consistent data fields and formats for the information that they already collect from the private sector under existing securities, commodities, and banking laws
- For information that existing laws already require agencies to publish, directs agencies to make such information available online as open data – electronically searchable, downloadable in bulk, and without license restrictions.
- Directs the Treasury Department to adopt data standards for concepts that reach across multiple financial regulatory agencies, such as entity identification, and requires the agencies to follow Treasury’s instructions.
- Specifically mandates the adoption of the global Legal Entity Identifier (LEI) across all financial regulatory reporting regimes, to allow easy matching of filings from the same entity with multiple regulators.
- Requires the Securities and Exchange Commission, for the short term, to replace its current duplicative financial statement reporting requirement, in which public companies must submit each statement once as a document and again as data, with a single filing in the inline XBRL format.
- Does not authorize any new information collections; does not release any new information not already required to be published under existing laws.
About the Data Coalition:
The Data Coalition advocates on behalf of the private sector and the public interest for the publication of government information as standardized, open data. Open data enhances accountability, improves government management, reduces compliance costs, and stimulates innovation. Our members represent a cross-section of the technology industry and implementers, including market leaders such as Workiva, Donnelley Financial Solutions, Booz Allen Hamilton, PwC, and CGI Federal and growing start-ups such as idaciti and cBEYONData. Collectively, they employ over two hundred thousand Americans and have a combined market capitalization exceeding $1.5 trillion. For more information, visit datacoalition.org.