Federal bank examiners could get new post-employment restrictions

Prompted in part by conflict-of-interest allegations stemming from the Riggs Bank investigation, Senate Governmental Affairs Investigations Subcommittee Chairman Norm Coleman, R-Minn., and ranking member Carl Levin, D-Mich., Monday introduced a bill calling for a "cooling off period" before certain federal bank examiners could go to work for financial institutions they had previously supervised.

The Coleman-Levin bill would require senior examiners who retire from their jobs at the Office of the Comptroller of the Currency and other federal banking regulatory agencies to wait at least one year before taking positions at the banks for which they once had oversight responsibility.

House Financial Services Oversight and Investigations ranking member Luis Gutierrez, D-Ill., introduced a similar bill last week. Financial Services Oversight and Investigations Subcommittee Chairwoman Sue Kelly, R-N.Y., is co-sponsoring that bill.

A one-year cooling-off period is among the recommendations included in a staff report Levin issued last July, following the subcommittee's year-long investigation into allegations that Riggs Bank had violated anti-money laundering laws. Comptroller of the Currency John Hawke also has urged lawmakers to enact a one-year cooling off period.

The report raised conflict-of-interest questions about a former OCC examiner who took an executive level job with Riggs shortly after retiring from OCC in 2002.

"Federal bank examiners are our first line of defense against money laundering and terrorist financing at U.S. banks, and we can't allow their independence to be undermined by the lure of a job at the banks they oversee," Levin said last week.

The Coleman-Levin bill falls under the jurisdiction of the Senate Banking Committee, which will examine the proposal as part of its broader inquiry into terrorist financing, according to a committee spokesman.

"We've held quite a few hearings on terror finance, and we think we will hold another couple of hearings prior to adjournment," the spokesman said. "It's a process we're moving through, and this is part of it."

A House aide familiar with the Gutierrez-Kelly bill said that legislation is not identical to the Senate bill, but is meant to cover the same ground. "I think there's a really large group of members who really think this needs to be done now," the House aide said.

The aide added that Gutierrez and Kelly hope to include their legislation in a package of proposals the House Financial Services Committee expects to mark up later this month to implement the recommendations of the 9/11 Commission. The Financial Services Committee also plans to hear testimony from Treasury officials Wednesday on 9/11-related proposals.

"We're having discussions with the [banking] agencies and working with committee staff to make changes and accommodate any concerns they may have," the House aide said of the Gutierrez-Kelly bill. "We're working out the details to make sure it captures the appropriate universe without being overzealous in scope."

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
FROM OUR SPONSORS
JOIN THE DISCUSSION
Close [ x ] More from GovExec
 
 

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Going Agile:Revolutionizing Federal Digital Services Delivery

    Here’s one indication that times have changed: Harriet Tubman is going to be the next face of the twenty dollar bill. Another sign of change? The way in which the federal government arrived at that decision.

    Download
  • Cyber Risk Report: Cybercrime Trends from 2016

    In our first half 2016 cyber trends report, SurfWatch Labs threat intelligence analysts noted one key theme – the interconnected nature of cybercrime – and the second half of the year saw organizations continuing to struggle with that reality. The number of potential cyber threats, the pool of already compromised information, and the ease of finding increasingly sophisticated cybercriminal tools continued to snowball throughout the year.

    Download
  • Featured Content from RSA Conference: Dissed by NIST

    Learn more about the latest draft of the U.S. National Institute of Standards and Technology guidance document on authentication and lifecycle management.

    Download
  • GBC Issue Brief: The Future of 9-1-1

    A Look Into the Next Generation of Emergency Services

    Download
  • GBC Survey Report: Securing the Perimeters

    A candid survey on cybersecurity in state and local governments

    Download
  • The New IP: Moving Government Agencies Toward the Network of The Future

    Federal IT managers are looking to modernize legacy network infrastructures that are taxed by growing demands from mobile devices, video, vast amounts of data, and more. This issue brief discusses the federal government network landscape, as well as market, financial force drivers for network modernization.

    Download
  • eBook: State & Local Cybersecurity

    CenturyLink is committed to helping state and local governments meet their cybersecurity challenges. Towards that end, CenturyLink commissioned a study from the Government Business Council that looked at the perceptions, attitudes and experiences of state and local leaders around the cybersecurity issue. The results were surprising in a number of ways. Learn more about their findings and the ways in which state and local governments can combat cybersecurity threats with this eBook.

    Download

When you download a report, your information may be shared with the underwriters of that document.