Regular Session 2023-2024 House Bill 0334 P.N. 0297

PRINTER'S NO. 297

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

334

Session of

2023

INTRODUCED BY STAMBAUGH, ZIMMERMAN, JAMES, M. MACKENZIE,

KAUFFMAN, HAMM, R. MACKENZIE, TWARDZIK, GLEIM, ROWE,

SCIALABBA, KEEFER AND LEADBETER, MARCH 13, 2023

REFERRED TO COMMITTEE ON COMMERCE, MARCH 13, 2023

AN ACT

Requiring fair access to financial services; imposing powers and

duties on the Department of Banking and Securities; and

imposing penalties.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. Short title.

This act shall be known and may be cited as the Fair Access

to Financial Services Act.

Section 2. Legislative intent.

The General Assembly finds and declares as follows:

(1) The Commonwealth recognizes the rights of its

residents, including the freedom of speech and association,

and that these rights may be infringed when financial

institutions limit access to financial services for any

reason other than objective financial criteria.

(2) The protection of the rights of this Commonwealth's

residents and businesses, including financial freedom, is a

fundamental role of government and any limitations on access

to financial services based on nontraditional criteria would

not only threaten the rights and proper privileges of this

Commonwealth's residents and businesses but would also be a

threat to the institutions and foundation of a free

democratic state and a threat to the peace, order, health,

safety and general welfare of this Commonwealth and residents

of this Commonwealth.

Section 3. Definitions.

The following words and phrases when used in this act shall

have the meanings given to them in this section unless the

context clearly indicates otherwise:

"Department." The Department of Banking and Securities of

the Commonwealth.

"Depository institution." The term includes:

(1) A depository institution as defined in 12 U.S.C. §

1813 (relating to definitions).

(2) A Federal credit union as defined in 12 U.S.C. §

1752 (relating to definitions).

(3) A State credit union as defined in 12 U.S.C. § 1752.

"Federal financial regulatory agency." The term includes the

Federal Reserve System, the United States Department of the

Treasury, the United States Office of the Comptroller of the

Currency, the National Credit Union Administration, the Federal

Deposit Insurance Corporation, the United States Securities and

Exchange Commission and the United States Consumer Financial

Protection Bureau.

"Financial institution." A depository institution, trust

company, licensee, an individual subject to the jurisdiction of

a Federal financial regulatory agency or person subject to the

jurisdiction of the department under the act of December 5, 1972

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(P.L.1280, No.284), known as the Pennsylvania Securities Act of

1972.

"Financial service." A financial product or service.

"Trust company." The term includes:

(1) A national bank authorized by 12 U.S.C. § 92a

(relating to trust powers).

(2) A trust company as defined in section 102 of the act

of November 30, 1965 (P.L.847, No.356), known as the Banking

Code of 1965.

(3) An interstate bank as defined in section 102 of the

Banking Code of 1965.

Section 4. Fair access to financial services.

To provide fair access to financial services, a financial

institution:

(1) Shall make each financial service the institution

offers available to all individuals in the geographic market

served by the financial institution on a nondiscriminatory

basis.

(2) May not deny a person a financial service that the

financial institution offers except to the extent justified

by the documented failure to meet quantitative, impartial

risk-based financial standards established in advance by the

financial institution or in compliance with section 5.

(3) May not deny a person a financial service that the

financial institution offers, other than as provided in

paragraph (2), if the effect of the denial is to prevent,

limit or otherwise disadvantage the person:

(i) From entering or competing in a market or

business segment.

(ii) In a way that benefits another person or

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business activity in which the financial institution has

a financial interest.

(iii) In coordination with a third party, from a

financial service that the financial institution offers.

Section 5. Disclosure of nontraditional evaluation criteria.

To provide financial services in this Commonwealth, a

financial institution that utilizes standards or guidelines

based on nonfinancial, nontraditional and subjective measures,

including environmental, social and governance criteria,

diversity, equity and inclusion policies or political and

ideological factors shall:

(1) Disclose to the department the specific standards,

guidelines and criteria used by the financial institution to

determine access or denial of a financial service to a person

in this Commonwealth.

(2) Comply with rules and regulations promulgated by the

department.

(3) Disclose to a person denied a financial institution

service the specific standards, guidelines and criteria used

to support the denial. The consumer disclosure shall be in

bold 14-point font.

Section 6. Regulations.

The department shall promulgate regulations relating to the

fair access to financial services to implement the provisions of

this act.

Section 7. Violations and penalties.

(a) Civil enforcement.--Unless otherwise authorized, a

financial institution that violates section 5 shall be subject

to civil enforcement by the Department of Revenue under the act

of December 17, 1968 (P.L.1224, No.387), known as the Unfair

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Trade Practices and Consumer Protection Law.

(b) Private civil action.--A person harmed by a violation of

this act may file a civil action.

under this section, violations of this act shall be a

misdemeanor if a financial institution has committed five or

more violations.

Section 8. Effective date.

This act shall take effect in 60 days.

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