On July 31, the US Department of the Treasury called for increased consumer data protection and notification guidelines for national data breaches in its fourth and final report in response to President Trump’s Executive Order 13772. The order, issued in February 2017, called on the department to pinpoint areas for improvement in financial regulations.
“American innovation is a cornerstone of a healthy U.S. economy. Creating a regulatory environment that supports responsible innovation is crucial for economic growth and success, particularly in the financial sector,” said Secretary Steven T. Mnuchin. “America is a leader in innovation. We must keep pace with industry changes and encourage financial ingenuity to foster the nation’s vibrant financial services and technology sectors.”
The final report discusses inconsistencies in laws and financial regulations, as well as radical improvements for nonbank financials, financial technology and digital innovation.
Considering the threat landscape and growing number of security incidents in the sector, consolidation and modernization of the regulatory environment, regulatory sandboxes to encourage innovation, increased consumer control over their personal data, as well as more sensible use of technology and consumer financial data are among the 80 improvement points mentioned in the report.
To ensure the recommendations are accurate, the Treasury collaborated with a number of experts in consumer financial data aggregation, lending, payments, credit servicing, financial technology, and innovation. Digitization in the modern economy allows companies to expand their business opportunities. The new technologies emerging deliver fast services to consumers but, if not regulated properly, the collection and storage of big data could affect data privacy and lead to data theft.