A 34-line amendment to promote data transparency has turned into a financial reform bill whodunnit.
Members of the House Financial Services Committee are asking what happened to the concise amendment they tucked inside the massive bill to require the Federal Reserve, Treasury Department, Commodity Futures Trading Commission, National Credit Union Administration, and Federal Housing Finance Agency to standardize the format used for collecting financial data.
Meant to increase transparency of financial information, the amendment was approved late last month by House negotiators, only to disappear from Senate negotiators’ version of the financial reform bill. The measure would have required the federal agencies to use eXtensible Business Reporting Language (XBRL) when compiling financial data for the newly-created Financial Stability Oversight Council.
The XBRL format is already required by the Securities and Exchange Commission for all public company reporting, and by the Federal Deposit Insurance Corp. for bank data submissions. XBRL tags allow users to quickly find and download financial information into spreadsheets for analysis using off-the-shelf software.
“We really don’t have any idea what happened to the amendment,” said Frederick Hill, a spokesman for the amendment’s sponsor, Republican Rep. Darrell Issa of California. “That’s what’s kind of ironic about this — an amendment to foster transparency was pulled out in the least transparent way possible.”
The Senate Banking Committee had no immediate comment.
The final version of the financial reform bill has been passed by the House, and is expected to narrowly win approval from the Senate next week, sending it to the president to sign into law.
The XBRL language had bipartisan support from House members, adding to the mystery. Issa and Democratic Rep. Mike Quigley of Illinois in March launched a bipartisan Congressional Transparency Caucus that aims to make government information freely accessible, consistently organized and electronically searchable.
“Without this [amendment] in the legislation you have different arms of the government doing different things with no communication and no coordination. That can cause a great many problems,” Hill said.
Both Issa and Democrat Barney Frank, chairman of the House Financial Services Committee, have stated publicly that they plan to get the XBRL measure adopted by sending it to the House floor for a vote.
“The underlying reason Bernie Madoff wasn’t caught for so long is that there was no transparency,” Hill said, referring to the investment manager now serving a life sentence for bilking clients out of as much as $65 billion. “The disinfectant sunlight of transparency must prevail.”
ABOUT THE DATA:
What: XBRL tags on business information collected by U.S. government
Where: Fed, Treasury, CFTC, NCUA, FHFA
Availability: Already used at SEC, FDIC
Format: n/a
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