House Committee Advances ABA-Backed Bills on Credit Reporting, SEC Reform, and Check Fraud
The House Financial Services Committee has advanced three banking-related bills backed by the American Bankers Association (ABA), moving forward proposals that would reshape liability under the Fair Credit Reporting Act (FCRA), reform the Securities and Exchange Commission (SEC), and strengthen protections against check fraud.
The measures were approved during a committee markup on June 30 as lawmakers considered a package of 10 bills.
Ahead of the markup, the ABA urged lawmakers to support the three bills, arguing they would modernize financial regulation, reduce unnecessary litigation, improve regulatory oversight, and help financial institutions combat increasingly sophisticated fraud schemes.
The bills cleared the committee with varying levels of bipartisan support and will now move to the next stage of the legislative process for further consideration.
FCRA bill seeks to limit class action liability
One of the measures approved was the FCRA Liability Harmonization Act (H.R. 5775), introduced by Rep. Barry Loudermilk (R-Ga.). The legislation would align liability standards under the Fair Credit Reporting Act with those found in other federal consumer financial protection laws.
If enacted, the bill would cap statutory damages in FCRA class action lawsuits, eliminate punitive damages, and place limits on attorneys’ fees in certain cases. Supporters argue these changes would reduce excessive litigation while maintaining consumer protections and preserving the dispute resolution process.
The ABA said the proposal would discourage abusive class action litigation without weakening consumers’ ability to challenge inaccurate credit reporting or seek legitimate remedies. The committee approved the measure by a 27-23 vote.
SEC reform proposal advances
The committee also voted 28-23 to advance the SEC Reform and Restructuring Act (H.R. 9329), sponsored by Rep. Ann Wagner (R-Mo.).
The legislation would introduce several procedural reforms designed to increase transparency and accountability within the Securities and Exchange Commission. Among its key provisions is a requirement that the SEC evaluate specified factors before issuing new regulations, including conducting cost-benefit analyses and considering the cumulative impact of existing regulations.
According to the ABA, these requirements would improve the quality and effectiveness of the commission’s rulemaking process by encouraging more comprehensive evaluations before new regulations are adopted.
Supporters of the bill argue the reforms would help ensure that future SEC rules are both transparent and appropriately tailored to achieve their intended objectives.
Check fraud legislation receives unanimous support
The committee unanimously approved the Strengthening Transaction Oversight and Preventing (STOP) Payments Fraud Act (H.R. 9331), introduced by Rep. Young Kim (R-Calif.).
The bill would amend the Expedited Funds Availability Act by allowing regulators to remove the current requirement that Treasury checks and cashier’s checks be made available for withdrawal on the next business day.
Banks have argued that the existing timeline often leaves insufficient time to verify high-risk checks before funds are released, creating opportunities for fraudsters to exploit the payment system.
The ABA said giving banks additional time to authenticate Treasury and cashier’s checks would strengthen fraud prevention efforts, reduce financial losses, and provide greater protection for consumers and financial institutions alike.
Check fraud has become an increasing concern across the banking industry in recent years, with financial institutions reporting more sophisticated counterfeit and altered check schemes targeting both consumers and businesses.
Supporters believe extending verification time would provide an additional safeguard against those risks.
ABA backs package of financial services reforms
The three measures formed part of a broader legislative package reviewed by the House Financial Services Committee during its June 30 markup session, where lawmakers considered 10 separate bills covering financial services, securities regulation, payments, and consumer protection.
While the legislation still faces additional steps before becoming law, the committee’s approval marks an important milestone for proposals the banking industry has identified as legislative priorities.
The ABA has consistently advocated for reforms that it says balance consumer protections with regulatory efficiency, while giving financial institutions greater flexibility to address emerging operational and fraud-related challenges. The advancement of the three bills signals continued congressional attention to issues affecting consumer credit reporting, securities oversight, and payment system security.
