United States House Committee on Financial Services

Committee information

• Date created: December 11, 1865
• Members: Fifty-eight members in the 116th Congress (2019–2021)
• Subcommittees: Investor Protection, Entrepreneurship and Capital Markets; Consumer Protection and Financial Institutions; Housing, Community Development and Insurance; Oversight and Investigations; National Security, International Development and Monetary Policy; Diversity and Inclusion

Role

The United States House Committee on Financial Services is a legislative committee tasked with overseeing and writing legislation regulating industries related to finance and housing in the United States. All the members of the committee are members of the House of Representatives. Like all other House committees, the Committee on Financial Services is made up of various members from both major political parties and run by a chairperson, who is from the political party holding the most seats in the House of Representatives at the time.

The Committee on Financial Services is an important committee that helps oversee the financial industry in the United States. The committee has important oversight of banks and issues related to banking, such as deposit insurance and federal monetary policy. The committee oversees the insurance industry and the consumer credit industry. The committee also oversees parts of the government, such as the Consumer Financial Protection Bureau, that helps protect consumers. The committee helps ensure that federal laws protecting consumers are being implemented. Committee members also determine whether new laws protecting consumers might be necessary.

Another important role the Committee on Financial Services has is to monitor the ways the financial services industry affects national security. Terrorism and other threats to national security can be identified through monetary transactions, and the committee helps oversee issues related to identifying national security threats through these transactions. The committee is also interested in protecting the financial services sector itself from being attacked by terrorists or other groups that might want to harm the United States. Furthermore, the committee has an interest in economic sanctions that the US Treasury Department implements on other countries. The committee can draft legislation regarding sanctions, or it can make recommendations regarding sanctions and give those recommendations to the Treasury Department.

The Committee on Financial Services helps oversee private and public housing and urban development. The committee oversees government organizations, such as the US Department of Housing and Urban Development, that help regulate and enforce laws concerning housing. The committee also oversees mortgage lenders and other credit lenders, ensuring they treat customers fairly. Members also work to ensure that credit lenders do not take risks that could jeopardize the health of the entire US economy.

Additionally, the committee oversees the insurance industry. The insurance industry is a large part of the financial services industry, and the committee ensures that the insurance industry is strong and sound. The committee also makes sure consumers being protected by the insurance industry.

Another issue that the Committee on Financial Services is tasked with overseeing is protecting consumer financial information. During the twenty-first century, new threats to consumer financial information arose thanks to changes in technology. The committee has the task of ensuring that the financial service industry takes these threats seriously, takes action to protect consumer financial information, and takes appropriate steps when consumer financial information is compromised.

The committee does its work with the help of subcommittees, which can hold hearings and request documents to learn more about specific issues. The subcommittees can also help draft legislation that could eventually become a law if it passes both houses of Congress and the president signs the bill.

History

The Committee on Financial Services has a long history, as it grew out of other House committees. The Committee on Ways and Means, which is still the oldest House committee, was established in 1789. The Committee on Ways and Means dealt with important financial issues such appropriations, banking, and revenue. In the first few decades of the country’s history, one bill was all the government needed to track its spending. Appropriations grew over the years, however. By the mid-1800s, the committee had too much responsibility. In 1865, the House of Representatives restructured its committee organization, creating new committees, including the Committee on Banking and Currency, which would become the Committee on Financial Services.

The Committee on Banking and Currency took over some of the duties of the Committee on Coinage, Weights, and Measures in 1921, and it took over the rest of those duties in 1946, when the House of Representatives totally restructured its committees. The Committee on Banking and Currency helped create the Federal Reserve System in 1913 and continued to oversee the Federal Reserve. The committee also oversaw the valuation of the dollar and the country’s gold and silver. This was a powerful committee whose members had a great deal of power. The committee was renamed the Committee on Financial Services in 1968, but the committee’s role remained largely unchanged despite the name change.

That same year, the Committee on Financial Services helped draft one of the most important consumer protection laws passed in the second half of the twentieth century. The Truth in Lending Act (1968) protected consumers dealing with lenders and creditors. The act required lenders to provide customers with vital information about loans, such as the annual percentage rate (APR) and the total costs the customer would incur. The Fair Credit Reporting Act, which was passed in 1970, was another important consumer protection law that the committee continues to oversee and ensure is being enforced. This law requires that consumers are able to see the information in their credit reports. In addition, consumers are allowed to know if information in their credit reports has been used to deny an application for credit. The Community Reinvestment Act (CRA; 1977) is another law passed by Congress and overseen by the Committee on Financial Services. This law is supposed to encourage financial service businesses to help meet the credit needs of the people in their communities.

The committee was also instrumental in drafting the Dodd-Frank Wall Street Reform and Consumer Protection Act (2010). Congress felt the need to create this act after the 2008 financial crisis, which many experts believe was brought about in large part because of actions taken by the businesses in the financial services industry. The complex law included many provisions regulating the financial services industry. Some of the provisions helped protect consumers from mortgage lenders and other credit lenders. Other provisions prohibit banks and other financial institutions from making certain risky investments with their own funds in an effort to prevent them from becoming financially insolvent.

In 2019, the Committee on Financial Services create a Diversity and Inclusion subcommittee, which was the first of its kind in Congress. The point of the subcommittee was to oversee and encourage diversity and inclusion in the financial services sector.

Subcommittees

The Committee on Financial Services has had numerous subcommittees throughout its history. The subcommittees allow members to specialize in specific areas of expertise, and they help divide the work and the writing of bills into smaller groups.

United States House Committee on Financial Services Subcommittee on Investor Protection, Entrepreneurship and Capital Markets

The Subcommittee on Investor Protection, Entrepreneurship and Capital Markets oversees participants in the US securities market. Securities are financial instruments that hold monetary value. The subcommittee oversees the practices of brokers, mortgage insurers, financial advisers, and others who are involved in these financial industries. The subcommittee also oversees a number of other organizations. One organization it oversees is the Securities and Exchange Commission, which is an agency of the federal government that enforces securities laws and regulates the securities industry. The subcommittee also oversees organizations related to mortgages and housing such as the Federal Housing Finance Agency, the Federal National Mortgage Association, and the Federal Home Loan Mortgage Corporation.

United States House Committee on Financial Services Subcommittee on Consumer Protection and Financial Institutions

The Subcommittee on Consumer Protection and Financial Institutions helps write laws about and oversees financial institutions, including the Federal Deposit Insurance Corporation (FDIC) and the Federal Reserve. The FDIC is a government institution created after the Great Depression to insure bank deposits for at least $250,000. This insurance is meant to avoid bank runs, during which people panic and take all their money out of financial institutions. The Federal Reserve is the national bank, whose leader is chosen by the president of the United States. The subcommittee also deals with matters related to the Consumer Financial Protection Bureau and with all aspects of consumer credit, including consumer access to credit.

United States House Committee on Financial Services Subcommittee on Housing, Community Development and Insurance

The Subcommittee on Housing, Community Development and Insurance oversees a number of important government institutions, including the US Department of Housing and Urban Development, the Government National Mortgage Association, and the Federal Insurance Office (FIO). The subcommittee oversees housing issues—including rentals, homelessness, homeownership, and rural housing—and insurance issues.

United States House Committee on Financial Services Subcommittee on Oversight and Investigations

The Subcommittee on Oversight and Investigations has a broad mandate. It is supposed to make sure that the financial services industries and federal regulatory bodies are adhering to federal laws. The subcommittee can oversee these institutions by holding meeting, interviewing witnesses, subpoenaing evidence, and more. This subcommittee reports back to other subcommittees and the committee as whole and informs other members when they believe certain rules or laws need to be changed.

United States House Committee on Financial Services Subcommittee on National Security, International Development and Monetary Policy

The Subcommittee on National Security, International Development and Monetary Policy helps oversee issues relating to national security. This body is supposed to help monitor the financial services industry to ensure its safety against terrorists and other treats. The body is also tasked with monitoring the financial services industries to look for signs of possible terrorism funding. The subcommittee has oversight over the Federal Reserve System. It also helps oversee international financial institutions, such as the International Monetary Fund and the World Bank. The subcommittee has some oversight in trade deals in regards to market access issues. This subcommittee also plays a role in helping to make sure the country’s anti-money laundering and anti-terrorism financing laws are implemented. This subcommittee helps oversee the US Mint and the Bureau of Engraving and Printing. It ensures that coins and currency are being designed and distributed appropriately.

United States House Committee on Financial Services Subcommittee on Diversity and Inclusion

The Subcommittee on Diversity and Inclusion was created in 2019. This subcommittee was the first of its kind in Congress. The point of the subcommittee was to examine diversity and inclusion in financial service industries and other areas in which the committee has oversight. When the subcommittee was created, leaders on the committee pointed out that financial service industry companies had particularly low levels of women and other minorities in senior leadership roles. The leaders on the subcommittee wanted to encourage more diversity and inclusion among such businesses.

Bibliography

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“House Committees.” United States House of Representatives, history.house.gov/Education/Fact-Sheets/Committees-Fact-Sheet2/. Accessed 11 Jan. 2019.

“Jurisdiction.” U.S. House Committee on Financial Services, 2019, financialservices.house.gov/about/jurisdiction.htm. Accessed 24 Jan. 2019.

Spieler, Matthew. The U.S. House of Representatives: Fundamentals of American Government. Thomas Dunne Books, 2015.

“Subcommittee Assignments.” U.S. House Committee on Financial Services, 2019, financialservices.house.gov/about/subcommittees.htm. Accessed 24 Jan. 2019.

“Subcommittee on Capital Markets, Securities & Investment.” U.S. House Committee on Financial Services, 2019, financialservices.house.gov/about/subcommittee-on-capital-markets.htm. Accessed 24 Jan. 2019.

“Subcommittee on Financial Institutions and Consumer Credit.” U.S. House Committee on Financial Services, 2019, financialservices.house.gov/about/subcommittee-on-financial-institutions.htm. Accessed 24 Jan. 2019.

“Subcommittee on Housing and Insurance.” U.S. House Committee on Financial Services, 2019, financialservices.house.gov/about/subcommittee-on-housing-and-insurance.htm. Accessed 24 Jan. 2019.

“Subcommittee on Monetary Policy and Trade.” U.S. House Committee on Financial Services, 2019, financialservices.house.gov/about/subcommittee-on-monetary-policy-and-trade.htm. Accessed 24 Jan. 2019.

“Subcommittee on Oversight and Investigations.” U.S. House Committee on Financial Services, 2019, financialservices.house.gov/about/subcommittee-on-oversight-and-investigations.htm. Accessed 24 Jan. 2019.

“Waters Outlines Agenda in First Policy Speech as Committee Chairwoman.” Committee on Financial Services, 16 Jan. 2019, financialservices.house.gov/news/documentsingle.aspx?DocumentID=401718. Accessed 25 Jan. 2019.