H.R. 4460: Stop Agency Fiat Enforcement of Guidance Act

This bill, known as the "Stop Agency Fiat Enforcement of Guidance Act" or the "SAFE Guidance Act," aims to bring clarity to the guidance documents issued by various financial agencies in the United States. It requires that when a financial agency publishes guidance, it must include a specific statement that clarifies the nature and authority of that guidance.

Key Provisions

• Guidance Clarity Statement: Each financial agency must place a clarity statement prominently at the beginning of any guidance document issued after the bill becomes law. This statement informs readers that the guidance:
• Does not have the force and effect of law.
• Does not create legal rights or obligations for individuals or entities.
• Is not binding on the agency or the public.
• Noncompliance with guidance does not automatically equate to violating applicable laws.
• Definition of Financial Agencies: The bill specifies which agencies are considered 'financial agencies' for the purpose of this requirement. These include:
• The Bureau of Consumer Financial Protection.
• The Department of Housing and Urban Development.
• The Department of the Treasury.
• The Federal Deposit Insurance Corporation.
• The Federal Housing Finance Agency.
• The Board of Governors of the Federal Reserve System.
• The National Credit Union Administration.
• The Office of the Comptroller of the Currency.
• The Securities and Exchange Commission.
• Guidance Definition: The bill defines guidance as statements issued by these financial agencies that are intended to affect the behavior of regulated parties but are not legally binding rules.

The bill is designed to reduce the potential for confusion among regulated entities regarding the nature of agency guidance, by clearly stating its non-binding nature and the lack of legal force behind it.

Intent of the Legislation

The overall intent is to ensure that regulated entities understand their rights and obligations concerning guidance documents. By specifying that such guidance does not have the authority of law, the bill seeks to protect entities from unintended regulatory consequences stemming from misinterpretations of agency guidance.

Impact on Financial Agencies

If this bill passes, financial agencies will have to change how they present guidance and ensure compliance with the requirements set out in the legislation. This could involve additional administrative work to revise existing documents and create new clarity statements for future guidance.

Relevant Companies

• JPM - JPMorgan Chase & Co.: As a major financial institution that interacts directly with regulatory agencies, JPMorgan could be affected by changes to the clarity and interpretation of agency guidance.
• BAC - Bank of America Corp.: Similar to JPMorgan, Bank of America will need to adapt to the non-binding nature of guidance from financial regulators to mitigate compliance risks.
• GS - The Goldman Sachs Group, Inc.: Goldman Sachs may experience changes in operational protocol in dealing with regulatory guidance under this legislation.
• SVG - Affected companies in the Securities sector, including those under the oversight of the Securities and Exchange Commission, such as investment firms, will need to reassess their strategies regarding compliance with agency guidance.