Acting Comptroller of the Currency Julie L. Williams Supports Regulatory Burden Relief Legislation

WASHINGTON — In testimony before the Senate Banking Committee today, acting Comptroller of the Currency Julie L. Williams spoke in favor of regulatory burden relief legislation and emphasized to a Senate panel that efforts to streamline massive consumer disclosure requirements present an opportunity both to reduce regulatory burden and improve the quality of information provided to consumers.

"Today our system imposes massive disclosure requirements — and massive costs — on financial institutions," Ms. Williams said. "But do these requirements effectively inform consumers?"

Federal banking agencies have broken new ground by employing consumer testing as an essential part of the interagency project to simplify GLBA privacy notices — a project that has the potential to produce more effective and meaningful disclosures for consumers and reduced burden on institutions that generate and distribute privacy notices, Ms. Williams noted.

"We are asking consumers—directly through consumer focus groups and testing—what they most want to know and what style of disclosure is most effective in communicating that information to them," Ms. Williams said. "We need to do more of this."

Ms. Williams also expressed concern that small institutions may not have the resources to absorb regulatory or overhead expenses without adversely affecting the quality and delivery of the services they provide.

"We need to recognize that the risks presented by certain activities undertaken by a community bank are simply not commensurate with the risks of that activity conducted on a much larger scale," Ms. Williams said. "One-size-fits-all simply may not be a risk-based — or sensible — approach to regulation in many areas."

A distinction needs to be made between banks based on the size, complexity and scope of their operations in framing the regulatory approach, according to Ms. Williams.

The role of the OCC and the other agencies is clear. "We, as federal banking regulators, have a responsibility to look carefully at the regulations we adopt, to ensure that they are no more burdensome than is necessary to protect safety and soundness, foster the integrity of bank operations, and safeguard the interests of consumers," Ms. Williams said.

Related Links

• Oral Statement (PDF)
• Testimony (PDF)