Congress - Snippets - 2010s

  • 2012 0124 - GOV (House) - How Will the CFPB Function Under Richard Cordray, Patrick McHenry (R-NC)

    • [PDF-107p, VIDEO-CSPAN-02:35:51] 

    • Unreasonable Advantage of Consumers vs Reasonable Advantage of Consumers

    • 1:59 - Trey Gowdy (R-SC):  Senator Warren never answered the question.  Dodd-Frank - Unreasonable Advantage of Consumers - Duties of Consumers in regard to Educating themselves

    • 2:00 - Richard Cordray, CFPB, Educate yourself, High School, People have to be Responsible for their decisions, what we can do it make clear / transparent, if they make a bad deal... they'll have to live with it... nobody is going to make a magic wand.

    • Trey Gowdy (R-SC): note that he has answered the question.

  • (p60) - David Schweikert - (R-AZ) - Are we going to wake up tomorrow and find out that the shadow on the horizon, the black swan was something that because of the concentration of the way you look at the world you completely miss?

2015 1208 - GOV (House) - Oversight of the Financial Stability Oversight Council (FSOC), Jeb Hensarling (R-TX)   ---   [BonkNote]

2024 0215 – GOV (House) – Protecting American Savers and Retirees from DOL’s Regulatory Overreach, Bob Good (R-VA)

2015 0429 – GOV (House) – The Impact of International Regulatory Standards, Blaine Luetkemeyer (R-IA)

  • 2015 0429 – GOV (House) – The Impact of International Regulatory Standards, Blaine Luetkemeyer (R-IA)  —  [BonkNote]
  • [PDF-125p, Part 1 – VIDEO-YouTube  —  Part 2 – 1:04 – VIDEO-YouTube]
  • [PDF-125p, Part 2 – 1:04 – VIDEO-YouTube] – <mp3, mp4>
  • VIDEO-CLIP – Westmoreland at International Regulatory Standards Hearing
  • House – Committee on Financial Services – Housing and Insurance
  • 29:00 – Mike Capuano, Optional Federal Charter, IAIS,
  • 39:00 – Garrett – different standards – FSOC vs. IAIS
  • (p19) – Mark Van Der Weide – (Deputy Director, Division of Banking Supervision and Regulation, at the Federal Reserve Board of Governors)
    • The FSOC publicizes a summary of its decision whenever it designates a non-bank SIFI.
      • And that was true as well for the three insurance non-bank SIFIs that the FSOC has designated.
    • They have also put out a public framework to describe the factors that they used to assess whether a particular non-bank financial firm is a SIFI.
      • And those procedures were followed in the process that led to the designation of the three U.S. insurers as non-bank SIFIs.
    • I think the FSOC recognizes that traditional insurance activities tend to generate low amounts of systemic risk.
      • But there are a fair amount of nontraditional insurance activities that are engaged in by those three firms, and those did generate some amounts of systemic risk.
    • Some of the key factors that were cited in the FSOC’s decisions included:
      • the extent of short-term funding activities at those organizations,
      • the extent of their capital markets activities- repos, securities, lending, OTC derivatives-which create interconnectedness with the rest of the financial system,
      • and also the runnable liabilities of some of those firms embedded in their insurance or annuities products, which would enable the annuitant or the insurance policyholder to potentially take out its money from the firm on short notice.
      • But those are some of the factors that…
  • (p21) – Chairman LUETKEMEYER. Thank you. Mr. Van Der Weide, I want to let you know that you gave us more information in your 2 or 3 minutes’ response here than all of the other folks we have had before this committee, put together, when we asked that question about SIFIs. Thank you for your response.

1982 – GOV (Senate) – Administration’s Fiscal Year 1983 Budget Proposal, Bob Dole (R-KS)

Part 1 of 5

  • STATEMENT BY THE HONORABLE DONALD T. REGAN, SECRETARY OF THE TREASURY
    • p26 – The federal corporate income paid by the largest mutual life insurance companies fell by 35 percent from 1979 to 1980, and by more than 40 percent from 1980 to 1981. The  primary reason for this reduction is modified coinsurance. In several cases, the effect was to nearly eliminate tax liability.

Part 2 of 5

  • p22 – STATEMENT OF BURTON E. BURTON, SENIOR VICE PRESIDENT, AETNA LIFE & CASUALTY CO., ON BEHALF OF THE HEALTH INSURANCE ASSOCIATION OF AMERICA …and the American Council of Life Insurance.
    •  

2015 0430 – GOV (Senate) – Examining Insurance Capital Rules and FSOC Process, Mike Crapo (R-ID)

  • 2015 0430 – GOV (Senate) – Examining Insurance Capital Rules and FSOC Process, Mike Crapo (R-ID)  —  [BonkNote]
    • Examining the Federal Reserve’s Implementation of the Collins Amendment to Tailor Capital Rules for Insurers on FSOC’s Designation Process for Nonbank SIFIs and for International Capital Developments for Insurers
    • [PDF-70p, VIDEO-Senate] – <mp3, mp4> –
    • Tim Scott (R-SC)
    • ACLI /AIA – Robert M. Falzon, Executive Vice President and Chief Financial Officer, Prudential Financial, on behalf of the American Council of Life Insurers and the American Insurance Association
    • PCI / NAMIC – Kurt Bock – Chief Executive Officer, COUNTRY Financial, on behalf of PCI and NAMIC
    • Law Professor – Daniel Schwarcz, Professor and Solly Robins Distinguished Research Fellow, University of Minnesota Law School
    • AAA – Elizabeth Brill, Chairperson, Solvency Committee Risk Management and Financial Reporting Council, American Academy of Actuaries – 5p
    • Senate – Committee on Banking, Housing, and Urban Affairs – Subcommittee on Securities, Insurance, and Investment

  • (p12) – Daniel SCHWARCZ, Law Professor – Absolutely, I think stress testing is very important. I think the difference is the Fed needs to stress-test specific to systemic circumstances, and so the types of stresses that it is going to consider are stresses to the broader financial system that occur simultaneously with stresses to the firm.

    • The other point I would like to make is it is absolutely true that most of the time life insurers’ liabilities are long term. But the very reason or one of the core reasons why firms get designated as SIFIseven though they engage predominantly in insurance is because liabilities that seem long term and usually are long term can become short term in systemic scenarios. For instance, policyholders can cash out or surrender; guaranteed investment contracts can be canceled. So stress testing for SIFIs needs to specifically look at the possibility that otherwise long-term liabilities will become short term and ask whether or not the firm can handle that given the sort of dominant assumption that in most times the liabilities are very long term and predictable.

  • (p12) – Mr. FALZON. Senator, I need to object to the observation that was just made. I think that both the review process for Prudential as a designation as a SIFI and that that was done for Metropolitan Life, we demonstrated with a body of evidence that, in fact, the acceleration of liabilities on an insurance company’s balance sheet does not give rise to systemic risk and, in fact, has been fairly modest. The evidence does not support the conjecture of that argument. I have not gone through the books. They are not available to me. But FSOC has indicated that is one of the reasons why both Prudential and MetLife were designated, and for that reason, stress tests need to take that into account

  • (p12) – Mr. SCHWARCZ. Can I just say one thing? Much of the information is not in the public domain, so I cannot say one way or another whether that is right. What I can say is that the FSOC decided in its public basis that indeed there was systemic risk associated with the possibility of a run on-and that was one of the bases of its designation. So I cannot personally say whether that is right. I have not gone through

1980 0320 – GOV (Senate) – Cancer Insurance and the Elderly, Birch Bayh (D-IN)

  • 1980 0320 – GOV (Senate) – Cancer Insurance and the Elderly, Birch Bayh (D-IN)  —  [BonkNote]
    • Senate – Subcommittee on Antitrust, Monopoly, and Business Rights conducted joint hearings with the House Select Committee on Aging 
  • (p32-) – Statement of Herbert Denenberg, Former Insurance Commissioner of Pennsylvania
    • (p32-33) – I would summarize by saying cancer insurance is an expensive form of junk, gimmick, Mickey Mouse, limited coverage that gives little value for its premium ; that is inherently inefficient and uneconomical; that often contains tricky, deceptive and unfair provisions, loopholes and fine print : that has often been sold not by fact but by appeals to fear, superstition , and the irrational ; that has been frequently mis-represented in advertisements and sales presentations, and that is often sold to those that are least likely to need its limited protection . 
    • (p35) – When a product is sold irrationally, out of fear, not reason, people buy it who will never benefit from it.
    • (p35) – We found our guides created an embarrassing glow of publicity that often forced high cost and Mickey Mouse companies to change their ways.
    • (p36) – We can survive even if we are free to get information to the public and to freely discuss and criticize abuses and problems in the marketplace. The one thing that is intolerable is a stifling and muzzling of criticism and discussion. 
    • (p36) – American Family Life, of Columbus, Ga., has apparently decided that it has to end the criticism and discussion of its products. So it has virtually admitted it is going to try to silence the critics by filing libel and slander suits.
      • Earlier this year I was sued by American Family Life Assurance Co. for $5 million for making this statement to a Changing Times reporter: “It makes no more sense to take out a cancer policy then it does to take out a leprosy or a chickenpox policy.”
      • Incidentally, I afterward told a reporter that that was the kindest thing I ever said about cancer insurance.
      • I would say if that is libel, virtually everything insurance experts have said about cancer insurance is libel, everything you gentlemen have said in Congress about cancer insurance is libel, and everything in that great 200-page report is libel.
      • In fact, my statement is quite mild compared to what other critics have said. Ralph Nader, for example, described cancer insurance as one of the biggest frauds in the insurance industry.
      • My statement was mild, true, and not libelous.
      • The suit filed against me was clearly frivolous. The intention of the suit was perhaps best suggested by the public statement of John P. Amos, chairman and chief executive officer of the American Family Life Assurance Co., at the time he filed another $275 million suit against ABC for a series it did on cancer insurance.
        • Mr. Amos then said, according to the National Underwriter of January 19, 1980, “We are prepared to answer malicious stone throwers with cannon fire.”
        • When Mr. Amos sued me, he also sued Changing Times and other defendants and made this statement: Anyone who did not and does not now take American Family seriously is a fool and should be fully prepared legally to defend its position. Protecting the integrity, good name and reputation of our company and the equity of our policies from being further maligned must at all times receive top priority. These threats cannot go unanswered and they will not. 
    • (p36) – Mr. Amos is saying in effect anyone who criticizes American Family Life Assurance Co. has to be prepared to defend legally his position and to face ” cannon fire. ” Mr. Amos has apparently decided it is cheaper to file frivolous lawsuits and to attempt to silence critics than to defend cancer insurance in the marketplace of ideas.
      • I think Mr. Amos knows that he can’t defend cancer insurance in the marketplace of ideas. That is why he is not here today.
    • (p37) – He once debated me on Good Morning America, and I guess he decided that wasn’t the right way to go. The right way to go is not to talk about it, to try to silence critics such as myself and perhaps such as this Congress.
      • I think this all raises some important questions. Should a corporation be able to use its resources to silence critics?
      • It should be noted that there are few if any remedies against this kind of lawsuit however frivolous, and the cost of defense can easily run $25,000 to $75,000 and up. Some law firms wanted a $25,000 down payment before they start talking. 
    • (p37) – Here is one business practice aimed directly at the first amendment and even aimed at Congress itself as one of the defendants in the Changing Times lawsuit is a congressional investigator. It is no coincidence that a company which uses improper tactics to sell cancer insurance will also use improper tactics to silence legitimate criticism.

1999 0428 and 0505 – GOV (House) – The Financial Services Act of 1999, Michael G. Oxley (R-OH)

  • 1999 0428 and 0505 – GOV (House) – The Financial Services Act of 1999, Michael G. Oxley (R-OH)  —  [BonkNote]
    • [PDF-205p, VIDEO-?]
    • House – Committee on Commerce – Subcommittee on Finance and Hazardous Materials 
    • 1999 0505 – Testimony – NAIC – HR 10 and Financial Services Modernization – George Nichols, III (KY) – 24p
    • (p111) – NAIC – Prepared Statement of Commissioner George Nichols III Chairman, Committee on Financial Services Modernization 
      • (p111-112) – Collectively, the insurance premiums paid by American consumers in 1997 amounted to … $107 billion for life insurance…
        • Consumers clearly have an enormous financial and emotional stake in assuring that the promises made by insurance providers are kept.
      • (p112) – State Regulators Are the Only Protection for Insurance Consumers
      • (p112) – HR 10 Prevents State Insurance Regulators from Protecting Consumers
        • NAIC pointed out the following serious flaws in HR 10 during NAIC President and Connecticut Insurance Commissioner George Reider’s testimony before the House Banking and Financial Services Committee on February 11, 1999.
  • (p71) – [Privacy] – Edward J. Markey (D-MA) – And when you drop by your insurance agent a few days later to take out a new life insurance policy, will he, after a few clicks of the mouse on his computer, look over to you and ask, so, can you tell me what all those recent charges are for sky-diving lessons?
    • Well, if we allow all of this to be mixed into one company, each one of these people will have access to your file whether or not they have any basis to have access to it.
    • Now, your friendly banker or broker or insurer in that one company wouldn’t be foolish enough to actually reveal to you that they have gathered all of this sensitive information about you because they know that if they ever did, you would reach right across the desk and throttle them for their insolence in prying into your personal affairs and talking about your daughter, your wife, your mother in those terms. But they do have the file right in front of them even though you didn’t go to them, that broker or that insurance agent or any other part of that affiliate for those services.
    • Under current law, there is nothing, absolutely nothing to prevent them from taking your family secrets and selling or transferring them to their affiliates all in the name of synergies. H.R. 10 does very little to stop the principal harm done by those much touted synergies, the taking of an individual’s most precious private property right, their right to privacy.
    • We are going to form a Congressional privacy caucus. We need one.

2024 2015 – PIABA – Testimony – Joseph C. Peiffer – 30p

  •  1 – At the beginning of my career, I represented hundreds of Exxon retirees. We tried a very long, hard fought case for 32 of these retirees. They were all chemical and refinery plant workers. Good, solid men and women, who were hard-working, remarkable Americans. They were told by the advisor that they should retire early, roll their 401(k) accounts over to the advisor’s care, and that they could withdraw 10-14% of their money every year with nothing to worry about.
    • But, in the trial of the case, the advisor and his firm said he just had the duty of a salesman.
    • The fact of the matter is that these folks did the right thing. They went to an advisor, who held himself out as an expert and told them that he had their best interest at heart. Their advisor did not. And when called to account for his behavior, their advisor argued he had no duty to put their interest in a long and happy retirement ahead of his interest in making huge commissions.
  • Department of Labor Retirement Security Rule (“DOL Rule”) would settle the duty that advisors have when dealing with retirement money.
  • p2 – The Scope of the Conflicted-Advice Problem is Huge and Getting Bigger
    • These costs are particularly acute when retirees roll over their employer 401(k) plan to an individual retirement account (“IRA”) because advice related to one-time rollovers is exempt from ERISA’s fiduciary obligations. This problem is compounded by the fact that advice to 401(k) sponsors and advice regarding the sale of fixed-indexed annuities and certain other non-securities is also not covered by ERISA’s protections.
  • p2 – How the DOL Rule Helps Mainstreet Investors
    • As it stands, financial advisors who sell would-be retirees on either liquidating or rolling over their 401(k)s into complex financial products are not always held to a fiduciary standard. 6
      • 6 2024 0102 – Letter – CFP to DOL- CFP Board, Letter to DOL Assistant Secretary Gomez re: DOL’s Retirement Security Rule (Jan. 2, 2024), at 4.- 1210-AC02 – 15p
    • p3 – The DOL Rule would put investors’ interest first by requiring advice on the roll-over or liquidation of a 401(k) to be up to ERISA standards, which is a fiduciary standard. This change is long overdue.
    • Morningstar
    • The DOL Rule doesn’t just help investors. It also helps ethical advisors. As the AARP says the decision to roll over a 401(k) is “often the single most important financial decision a plan participant makes, involving a lifetime of retirement savings and the fact [is] that these recommendations carry with them an inherent conflict of interest.”10 The DOL Rule closes this loophole.
  • p4 – Retirees in Every State and District Have Been Harmed by Conflicted Advice
    • Behind the huge numbers illustrating the problem are real people, who have been severely impacted by the current lack of a fiduciary requirement. These people exist throughout the United States, in every state, and in every congressional district. I have gathered some examples below.
    • Some of these folks were represented by my office and others were represented by PIABA members.
    • “IRA Reboot” – These investors, the vast majority of whom were either retired or in their 60s, were told they should undergo an “IRA Reboot” that would “turbocharge their IRA” or “turbocharge their 401(k)” by liquidating their retirement account and purchasing a complex insurance product along with premium financing. Many of our Utah clients were also advised that in addition to liquidating their 401(k)s, they should mortgage their homes.
      • They were lured in by “seminars” that purported to give objective, fiduciary advice, but in reality, were just sales sessions used by these advisors, sometimes called “Wealth Architects,” to line their pockets with huge commissions. It is telling that while the marketing material to my clients talked about “turbocharging their 401(k)s” the marketing material aimed at the advisors talked about “turbocharging [the agent’s] commission.
      • All suffered a loss of dignity and trust.
        • ⇒  I have attached a small sample of the impact on some these clients in their own words as Exhibit “A” to this testimony.
  • p5 – The DOL Rule Brings Regulation into Line with Investor Expectations 
    • All of my clients over my nearly 25 years of experience, like nearly all investors, thought that their advisors were their fiduciaries. This is not unusual.
      • According to the Certified Financial Planner Board of Standards (“CFP Board”), a nonprofit organization that sets and upholds standards for financial planners, investors now overwhelmingly expect that financial professionals always provide them advice in the investors’ best interests.11 Several studies that illustrate this trend; for example, the Center for Capital Markets Competitiveness indicated 97% of investors already believed their financial professionals had their best interests in mind, and a recent AARP study revealed 89% of investors over the age of 50 felt the same.12
    • Investors’ beliefs that their financial professional have their best interest in mind is due at least in part to these advisors and their trade associations marketing that way. Investment professionals routinely use titles, such as “financial advisors,” “financial consultants,” or “wealth managers,” or even “wealth architects.” I have never heard a financial professional refer to themselves simply as a salesman.
    • Here is a sample of what investment professionals, firms and their trade associations say now to position themselves as providing advice that is in investors’ best interest:
      • NAIFA, Red Bird Advisor, The Insurance Pro Shop, F&G, NationWide, The Standard, SuccessCE, Brighthouse, New York Life
      • Yet, when we attempt to make advisors account for the advice that investors liquidate or roll over their retirement accounts, the advisors and the companies they work for claimed that these advisors owed these investors no duty for the advice. The DOL Rule would simply bring the legal standard up to the standard that nearly all investors expect when dealing with a financial professional in their retirement account.
  • (p7) – The DOL Rule will Close the Disclaimer Loophole
  • (p8) – Small Savers will be Helped, not Harmed, by The DOL Rule
  • (p8) – The DOL Rule Provides Investors Protection that Reg BI does not. 
    • First, the SEC’s Reg. BI does not apply to advice to purchase anything other than securities.
      • This excludes investments such as certain insurance products, bank products, commodities, real estate and cryptocurrency. These are large and emerging areas of investments that are still subject to conflicted advice without the DOL Rule.
  • (p9) – The NAIC Standard is Best Interest in Name Only
  • (p10) – Exhibit “A”
    • Dolores – IRA – Minnesota Life – Gold Star
    • John – [Bonk: No Specific Information] 
    • Michael – 2 PacLife Policies
      • The bogus Pac Life accounts will set me back quite a few years unless money is recovered. Right now, I have $181,000 into both of these policies and was recently told by the company that since last year was a bad stock year and they only yielded 1% the accounts will be broke in 7 years.
    • Elizabeth – Not Life Insurance
    • Earl – 
    • Bobby
    • Alan – IUL – FIP – 
    • Diane
    • Paul and Susan – PacLife – FIP – 
    • Mary – 
    • Jerome
    • Jane
    • Stanley – IUL – FIP
    • Debra
    • Devon Jr & Barbara – IUL – Minnesota Life 
    • Glenn & Gudrun – IUL – FIP – 
    • Kurt – Minnesota Life – FIP – Tax-Free Income – We did not need Life insurance
    • Dennis – 
    • Christine
    • Debbie
    • Steven – IUL – Minnesota Life – Gold Star – FIP
    • Suzanne
    • Florence – [IUL] – Pacific Life – FIP
    • Thomas
    • David – IUL – tax free for retirement – 
    • Robert – IUL – Tax-Free Income
    • Frederick
    • Dennis & Maxine – IUL – FIP
    • David – IUL – 
    • Virginia
    • Vandy – 
    • Kelley
    • Samuel
    • Sara
    • Pam
    • Robert
    • Walter
    • William – IUL – FIP –
    • Jeffrey
    • Gloria – IUL

Government Hearings – 2024

  • 2024 0110 – GOV (House) – Regulatory Whiplash: Examining the Impact of FSOC’s Ever-changing Designation Framework on Innovation, French Hill (R-AR)
    • [PDF-118p,  VIDEO-YouTube-02:16:20]
    • House – Committee on Financial Services – Subcommittee on Digital Assets, Financial Technology and Inclusion

TNEC – Temporary National Economic Committee

  • 1938-1941 – GOV (Senate) – TNEC – Temporary National Economic Committee, Joseph C. O’Mahoney (D-WY)  —  [BonkNote]
  • 1941 – GOV (Senate) – TNEC – Final Report and Recommendations of the Temporary National Economic Committee, Investigation of Concentration of Economic Power – 464p
    • (p269) – Life insurance funds are not venture capital; they are seeking safe, long-term investments, preferably the bonds of well-established enterprises or ….
  • Dr. Dewey Anderson, executive secretary of the Temporary National Economic Committee