The Council of Insurance Agents + Brokers showed its support to The House Financial Services Committee Chairman Mike Oxley (R-OH) and Rep. Mike Rogers (R-MI) on the recent passage of the Financial Services Antifraud Network Act 2001 (HR 1408) by the House Financial Services Committee.
According to The Council, the legislation helps stop the spread of fraud in the financial services industry, promoting the partnership of financial services regulators to work together and present one front against those looking to take advantage of the market freedoms engendered in Gramm-Leach-Bliley, via fraud and deceptive plans.
The legislation also will help state insurance regulators to gain access to federal criminal records to conduct background checks on those entering the insurance industry as presently, only a number of state insurance regulators can carry out those checks.
Recently, The Council Board of Directors adopted a policy position in favor of a criminal history check for each producer as a function of the resident licensing process.
According to the Alliance of American Insurers, HR 1408 would create a computerized network to allow state regulators and federal law enforcement agencies greater access to each other’s anti-fraud databases.
Alliance Washington Counsel Kenneth Schloman stated that several aspects of the bill were amended slightly in committee to give functional regulators, including state insurance commissioners, the opportunity to create a plan for putting the network into effect. Those provisions, similar to the NARAB versions, would give regulators six months to submit the plan and then two years to put it into effect. These changes tightened the bill and included privacy protection for those subject to a background check, Scholman said. He added that overall this is a good bill demonstrating exactly the kind of positive influence the federal government can have in helping the states to harmonize their activities in the interest of the greater good.
The House Judiciary Committee will now review the bill’s provisions regarding access to the Federal Bureau of Investigation (FBI) fingerprint database. The House Agriculture Committee will consider a small portion of the bill, dealing with commodity traders, before it is sent to the floor. At this point there is no comparable legislation in the Senate.
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