The House of Representatives approved H.R. 10, the Financial Services Act, July 1.
The bill, passed by a vote of 343-to-86, is designed to deregulate the nation’s financial systems and allow banks, securities firms and insurance companies to enter into each other’s businesses.
Proponents of the bill believe that consumers will benefit from H.R. 10 through more convenient and less expensive financial services. They also believe it will enable U.S. companies to compete more effectively for business around the world and provide community banks with the tools to compete against mega-banks Internet banking.
The bill also contains consumer protection and financial privacy protections. For example, it requires banks to disclose their privacy policies to customers, and outlaws pretext calling — where a person uses fraudulent means to obtain private financial information of another person-making it a federal crime punishable by up to five years in jail and a fine of up to $250,000.
Opponents of the bill — privacy advocates in particular — believe that it could undermine privacy, however, by giving financial institutions and insurance companies free reign to share consumer information.
Lawmakers believe the bill will pass during this session of Congress, despite the fact that it now has to move onto a conference committee between the Senate and the House. The Senate version of the bill would take away the authority of the Treasury Department to regulate banks.