Scott Initiatives Included in Major Bipartisan Banking Legislation
Washington – Several initiatives introduced by U.S. Senator Tim Scott (R-SC) have been included in S. 2155, the Economic Growth, Regulatory Relief, and Consumer Protection Act, which the U.S. Senate is debating this week. Scott’s amendments included in the broader legislative package are the Protecting Children From Identity Theft Act, legislation that will help prevent children’s identity being stolen by a type of theft known as “synthetic ID fraud,” and the Credit Score Competition Act, which will help more Americans achieve homeownership by including 26 million “credit invisible” individuals in the housing market.
“It is a great day when we have the opportunity to pass legislation that will create real, tangible change for the American people,” said Scott. “I am very pleased that my amendments will be included, as they will take a significant step forward in curbing ‘synthetic ID fraud’ – a crime that negatively impacts millions of people, and also a seeks to help credit-invisible Americans be more competitive for mortgage lending and homeownership.”
Scott’s first amendment, the Credit Score Competition Act, was first introduced late last summer and was a bipartisan effort spearheaded by Scott and Sen. Mark Warner (D-VA). The Credit Score Competition Act directs the Federal Housing Finance Agency to create a process by which new credit scoring models can be validated and approved for use by Fannie Mae and Freddie Mac (GSEs) when they purchase mortgages. Currently, the GSEs are mandated to consider a decades-old credit scoring model that does not take into account consumer data on rent, utility, and cell phone bill payments. For example, In South Carolina alone, only 77% of adults can be scored under the model currently used by the GSEs. An additional 16% of South Carolinians can be scored under newer credit scoring models in the market.
Scott’s second amendment, the Protecting Children From Identity Theft Act, was introduced this week by a group of bipartisan cosponsors including Senators Bill Cassidy (R-LA), Claire McCaskill (D-MO), and Gary Peters (D-MI). A recent study found that one in ten children had their SSN stolen, and used to open fraudulent accounts. This amendment aims to stop this illegal activity by directing the Social Security Administration (SSA) to accept electronic signatures as consumer consent for financial institutions trying to verify customer ID and root out synthetic ID fraud.
Last year, two additional provisions authored by Scott were added to the bill, the MOBILE Act and the Family Self-Sufficiency Act.
The vote for final passage of the Economic Growth, Regulatory Relief, and Consumer Protection Act is anticipated to take place next week.