Scott Provisions Headed to President’s Desk, Will Help Protect Children and Families from ID Theft, Increase Access to Credit for Low-Income and Minority Americans
WASHINGTON, DC – It may be raining again in Washington today, but it is a fantastic day for Main Street America as multiple provisions introduced by U.S. Senator Tim Scott (R-SC) are headed to the President’s desk for his signature after passage of the bipartisan Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155) by the U.S. House of Representatives. The Senate previously passed the legislation in March.
“As the Economic Growth, Regulatory Relief, and Consumer Protection Act heads to the President’s desk for signature, I am excited that four of my provisions to protect American families are included,” Senator Scott said. “To be able to strengthen protections for children and families in the fight against identity theft, provide more access for low-income and minority communities that often do not have access to credit and banking, and ensure educational and job training opportunities are available for more families all in the same bill is absolutely fantastic. This legislation is a huge victory for Main Street and will open doors to a brighter future for so many families across South Carolina and the nation.”
The following consumer-friendly provisions were secured in S. 2155 by Senator Scott:
- Credit Score Competition Act: The bipartisan 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. The exclusion of these data disproportionately hurts minorities and first-time homebuyers. 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.
- Family Self-Sufficiency Act: The bipartisan Family Self-Sufficiency Act streamlines the already existing Family Self-Sufficiency (FSS) program which pairs individuals living in public housing with job opportunities and achieving financial goals. Under the measure, the FSS Act broadens the scope of supportive services to include receiving a GED or other post-secondary training, while eliminating redundant costs at the Department of Housing and Urban Development. The legislation is supported by the National Association of Public Housing Authorities.?
- Protecting Children From Identity Theft Act: A recent study found that one in ten children had their Social Security Numbers stolen and used to open bank accounts and lines of credit fraudulently. 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.?
- Making Online Banking Initiation Legal and Easy (MOBILE) Act: The MOBILE Act addresses the fact that current laws in regard to identity verification have not kept up with the changing technologies of the Internet era. This amendment would allow banks and credit unions to use a scan or picture of a driver’s license to verify a customer’s identification when they open an account online. It also specifically stipulates the image must be destroyed after the account is created in order to protect privacy. Approximately 16 million adults live in households without a checking or savings account and an additional 51 million adults live in households that have a bank account but rely on nonbank lenders like payday lenders and pawnbrokers with sky-high interest rates. However, about 90 percent of underbanked adults own a mobile phone, of which 75 percent are smartphones.