Ed Royce

  • 1993-2019 - US House - (R-CA) 
  • 2008 0923 - WSJ - Insurance Companies Need a Federal Regulator, by John Sununu, Tim Johnson, Melissa Bean and Ed Royce - [link]
  • 2012 0712 - Bloomberg - Congressman Seeks Treasury Exam of State Insurance Group, By Noah Buhayar - [link]
  • 2012 0712 - ThinkAdvisor - Royce Demands FIO Probe of NAIC, By Arthur D. Postal - [link]
    • He said that he has observed over the years that he has been in Congress, that the insurance regulatory regime in this country is “out of date and inefficient, and the heart of that system is the NAIC.” 
    • Royce requested the review in a letter delivered today to Michael McRaith, FIO director.  <WishList>
    • 2012 0712 - Letter - GOV (Ed Royce) to NAIC (Michael McRaith) - 4p
  • 2012 0228 - Letter - GOV (Royce) to NAIC
    • <WishList> - http://royce.house.gov/UploadedFiles/Royce_Letter_to_the_NAIC_2.28.12.pdf
    • Response: 2012 0320 - Letter - NAIC (Kevin McCarty) to GOV (Royce) - 3p
  • 2012 0321 - RStreet - The Royce-NAIC spat heats up, By R.J. Lehmann - [link]
  • 2012 0712 - Letter - GOV (Royce) to FIO (Michael McRaith - Director - Federal Insurance Office) - 4p
  • 2012 0713 - InsuranceJournal - Rep. Royce Takes His NAIC Questions to Treasury, By R.J. Lehmann - [link] 
  • 2013 1004 - ThinkAdvisor - Rep. Royce again questions NAIC's authority, By Arthur D. Postal - [link]
    • “I do not think it is too much to ask that the $80 million trade association define who it is and what it can do…but of course tough questions draw criticism,” Royce said.
  • 2008 0710 - GOV (House) - Systemic Risk and the Financial Markets, (CSPAN) Transformation of Financial Markets, Barney Frank (D-MA)  ---  [BonkNote]
    • Paulson, Bernanke
    • 1:15:00 - Ed Royce (R-CA) - Runs
    • 1:17:30 - Paulson - need resolutions authority like FDIC
    • House - Committee on Financial Services 
  • (p35) - Ed ROYCE (R-CA) - Earlier, Mr. Bachus alluded to this notion that the underwriting side of AIG overseen by the State insurance regulators was somehow walled off from the abstract securities lending division.
    • Unfortunately, news reports, such as the Wall Street Journal article that was dated October 10, 2008, which I would like to insert into the record, detail the inaccuracy of this perception.

2009 0305 - GOV (House) - Perspectives on Systemic Risk, Paul Kanjorski (D-PA)  --- [BonkNote]

  • H.R. 3200, introduced last July by Representatives Melissa Bean and Ed Royce, is a strong consumer protection bill, which focuses on a centralized system that emphasizes safety, soundness, and consistency of regulation.
  • And as Representative Bean highlighted, these protections come without sacrificing State premium taxes.
  • We also strongly support the Treasury’s view that an optional Federal charter would play an important role in the new world of integrated financial markets, and would address the burdens imposed by the State system on insurers and consumers alike.
  • Insurers, banks, and capital markets investors are now offering products that may be substitutes for each other...

-- Alastair Shore (CUNA) on Behalf of the American Council Of Life Insurers

2008 0416 - GOV (House) - Examining Proposals on Insurance Regulatory Reform - [PDF-188p, Video-?]

  • 2009 0204 - GOV (House) - Assessing the Madoff Ponzi Scheme and Regulatory Failure
    • Investigations of Madoff Fraud Allegations
    • [PDF-202p] 
    • VIDEO-CSPAN - (Part 1 of 3) 
    • VIDEO-CSPAN - (Part 2 of 3) - Ackerman/SEC/KanjorskiS
      • Short - 23:58-Ackerman
      • Long - 23:58-36:20
      • Royce - 36:58-
    • [?] - Video - (Part 3 of 3)
    • House - Committee on Financial Services - Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises

Ed Royce (R-CA) -

  • But in early 2008, we had another issue surface, and we saw many of the top bond insurers suffer significant losses and subsequent rating downgrades resulting from their exposure to the U.S. mortgage market.
    • Their rating downgrades contributed to the freezing of credit markets, and that fed, of course, into the larger economic crisis and turmoil that we have had in this country.
  • And then came the fall of AIG.
    • And the bets that brought down AIG were made through the firm’s securities lending division as well as the financial products unit.
    • As we consider the events of the past as they relate to regulatory reform, it is worth noting that the securities lending division was facilitated and funded by AIG’s insurance subsidiaries as a vehicle to make unwise bets on the U.S. housing market.
    • At least, that is the way I would put it, since they were leveraged 170 to 1.
  • Using capital from their insurance subsidiaries with the approval of the various State insurance regulators, the securities lending division, in tandem with the financial products unit, put at risk the
    entire company and, to some degree, the broader financial system.

2009 0514 - GOV (House) - How Should the Federal Government Oversee Insurance?   ---  [BonkNote]

(p24) - Ed Royce (R-CA): That takes me to the theme of Harry Markopolos’ testimony here that I think riveted everyone when he said that it was his belief that the SEC was over-lawyered.

  • He noted, and then subsequently the SEC officials affirmed it, he noted there was a fundamental
    lack of understanding of the more intricate aspects of our financial markets within the SEC which prevented the SEC year after year from uncovering the Madoff incident.
  • I do think Mr. Markopolos is on to something ...that part of their problem was the ....lack of understanding of how the market works by the people who are supposed to regulate it.

2009 1006 - GOV (House) - Capital Markets Regulatory Reform: Strengthening Investor Protection, Enhancing Oversight of Private Pools of Capital, And Creating a National Insurance Office - [PDF-325p]

  • Brad Sherman (D-CA) - We saw with AIG an excellent case study.
    • That portion of the enterprise that was subject to State insurance regulation remained healthy even though the top managers in the company were behaving like drunken sailors.
    • Those parts of the company that were not subject to State insurance regulation crashed as if they were being run by drunken sailors.
    • The other thing this proves is that credit default swaps are insurance and should be treated as such.
    • And we probably would not have had a 5-year catastrophe in our economy had we done two 
  • Ed ROYCE  (R-CA) - And just a reminder for my friend from California, that the securities lending operation of AIG was regulated at the State level.  (p4)

2014 0520 - GOV (House) - Legislative Proposals to Reform Domestic Insurance Policy - [PDF-128p, VIDEO-YouTube] 

(p4) - Mr. ROYCE (R-CA). Well, with our fragmented regulatory regime over insurance, I think it is very clear that we are lagging behind the rest of the world.

  • Solvency II will be implemented by the EU in the coming months, and that will bring all of Europe under one market for insurance.
  • Yet the United States continues to struggle with 50 individual markets.

2009 1006 - GOV (House) - Capital Markets Regulatory Reform: Strengthening Investor Protection, Enhancing Oversight of Private Pools of Capital, And Creating a National Insurance Office - [PDF-325p]

  • Ed Royce (R-CA):  And I think this hearing today proves that memory is very fleeting.
    • Memory in terms of the failure at the Federal level and the failure at the State level with respect to regulation here.   (p33)

2017 1024 - GOV (House) - The Federal Government’s Role in the Insurance Industry - [PDF-140p

  • Ed ROYCE - (R-CA)
    • So we have the SEC. We have the Fed. We have the OCC that all serve to get financial instruments to represent the interests of the banking industry in terms of gaining access to markets overseas, and you are speculating that the National Association of Insurance Commissioners is not going to have that same clout or seat at the table in terms of opening those markets for competition?
  • Christopher M. Condron, Chairman of the Board and Chief Executive Officer, AXA Equitable Life Insurance Company, on behalf of the American Council of Life Insurers (ACLI)
    • They just cannot.
    • You know, they cannot agree on what the reserving requirements will be on universal life insurance policies, or when they do agree, they cannot get all of the States to go along, and that is the  frustration, I think, Commissioner Bell and all of the commissioners have always had with the NAIC.  (p163)

2007 1003 - GOV (House) - The Need for Insurance Regulatory Reform - [PDF-163p

  • Ed Royce (R-CA). Thank you, Mr. Chairman. At the outset, I would just like to set the record straight on an issue that I think was raised twice today, and that is the story of AIG.
    • If I could submit for the record, Mr. Chairman, the story that ran in last week’s American Banker? ...
    • It is by Hester Pierce. It is entitled, ‘‘AIG’s Collapse: The Part Nobody Likes to Talk About.’ - [link]

And that part, of course, is the securities lending portfolio run for the benefit of the State-regulated life insurance subsidiaries of AIG. (p55)

2014 0624 - GOV (House) - The Annual Report of The Financial Stability Oversight Council - [PDF-261p