Senators introduced a bill Wednesday to improve collection and publication of data by eight federal financial regulatory agencies.
The Financial Data Transparency Act (FDTA) would require the agencies to create common standards around the organization, readability and availability of the data they collect from the institutions they regulate.
Investors and consumers currently lack a means to electronically search the information institutions report to financial regulators, but the FDTA would require that data be made open as appropriate in a machine-readable format within four years of its passage.
“Making financial data used by federal regulators more accessible and understandable to the American public is an important step in improving government transparency and accountability,” said Sen. Mike Crapo, R-Idaho, in the announcement.
Crapo has co-sponsored the bill with Sen. Mark Warner, D-Va.
Should the bill become law, the Treasury Department, Securities and Exchange Commission, Federal Deposit Insurance Corp., Office of the Comptroller of the Currency, Consumer Financial Protection Bureau, Federal Reserve Board, National Credit Union Administration, and Federal Housing Finance Agency would have two years to finalize data standards through a joint rulemaking. They’d have another two years to implement those standards in their data reporting.
Standards would build on government, industry and international best practices for data handling and processing and include common, non-proprietary legal identifiers for financial products, instruments and transactions. Identifiers would be available under an open license and free.
An open license format would promote competition to create data collection and analysis tools that reduce costs for agencies.
Agencies would also be required to make financial data interoperable for consistency, ease of use and streamlined compliance.
“The bipartisan Financial Data Transparency Act will modernize our national financial reporting infrastructure to leverage data in a smart, timely and critical way,” said Nick Hart, president of the Data Foundation, in a statement. “These necessary data reforms are a tremendous benefit to everyone, whether they are on Wall Street or Main Street, because we all need reliable, quality information at hand to make good decisions.”