ICBA-advocated legislation to close the industrial loan company loophole added a House Republican co-sponsor.
GOP Co-sponsor: Rep. Lance Gooden (R-Texas) on Wednesday said he has signed on as a co-sponsor to the Close the ILC Loophole Act (H.R. 5912) because the loophole has been abused as a vehicle for companies to provide financial products and services while avoiding regulatory supervision.
Legislative Details: Introduced by Rep. Jesús “Chuy” García (D-Ill.), the legislation would amend the Bank Holding Company Act to remove the exemption for ILCs from the definition of a bank with a one-year transition period, thereby permanently closing the ILC loophole.
ICBA Position: ICBA last fall told Congress that while it is working with García’s office to improve the legislation, it supports all efforts to close the ILC loophole and encouraged a moratorium on ILC applications.
More: ICBA also offers a comprehensive white paper detailing why policymakers should close the legal loophole, which allows ILCs and their parent companies to skirt regulatory oversight.