119-hr1658

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1658 Introduced in House

    (IH) ]

<DOC>

119th CONGRESS
 1st Session
 H. R. 1658

To amend the Truth in Lending Act to address certain issues relating to 
 the extension of consumer credit, and for other purposes.

_______________________________________________________________________

 IN THE HOUSE OF REPRESENTATIVES

 February 27, 2025

Ms. Bonamici (for herself, Ms. Jayapal, and Ms. Schakowsky) introduced 
 the following bill; which was referred to the Committee on Financial 
 Services

_______________________________________________________________________

 A BILL

To amend the Truth in Lending Act to address certain issues relating to 
 the extension of consumer credit, and for other purposes.

 Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

 This Act may be cited as the ``Stopping Abuse and Fraud in 
Electronic Lending Act of 2025'' or the ``SAFE Lending Act of 2025''.

SEC. 2. CONSUMER CONTROL OVER BANK ACCOUNTS.

    (a) Prohibiting Unauthorized Remotely Created Checks.--

Section 905 
of the Electronic Fund Transfer Act (15 U.S.C. 1693c) is amended by 
adding at the end the following:
 ``
            (d) Limitations on Remotely Created Checks.--
 ``

    (1) === Definition. ===
-In this subsection--
 ``
        (A) the term `Federal consumer financial law' has 
 the meaning given the term in 

section 1002 of the 
 Consumer Financial Protection Act of 2010 (12 U.S.C. 
 5481); and
 ``
        (B) the term `remotely created check' means a 
 check, including a paper or electronic check and any 
 other payment order that the Bureau, by rule, 
 determines is appropriately covered under this 
 subsection, that--
 ``
            (i) is not created by the financial 
 institution that holds the customer account 
 from which the check is to be paid; and
 ``
            (ii) does not bear a signature applied, 
 or purported to be applied, by the person from 
 whose account the check is to be paid.
 ``

    (2) Limitations.--Subject to the limitations in paragraph

    (3) and any additional limitations that the Bureau may 
 establish by rule, a remotely created check may only be issued 
 by a person designated in writing by a consumer, with that 
 written designation specifically provided by the consumer to 
 the insured depository institution at which the consumer 
 maintains the account from which the check is to be drawn.
 ``

    (3) Additional limitations.--
 ``
        (A) In general.--A designation provided by a 
 consumer under paragraph

    (2) may be revoked at any time 
 by the consumer.
 ``
        (B) Consumer financial protection laws.--No 
 payment order, including a remotely created check, may 
 be issued by any person in response to the exercise of, 
 or attempt to exercise, any right by a consumer under--
 ``
            (i) any Federal consumer financial law; 
 or
 ``
            (ii) any other provision of any law or 
 regulation within the jurisdiction of the 
 Bureau.''.

    (b) Consumer Protections for Certain One-Time Electronic Fund 
Transfers.--

Section 913 of the Electronic Fund Transfer Act (15 U.S.C. 
1693k) is amended--

    (1) in the matter preceding paragraph

    (1) , by inserting 
 ``

    (a) In General.--'' before ``No person'';

    (2) in subsection

    (a)

    (1) , as so designated, by striking 
 ``preauthorized electronic fund transfers'' and inserting ``an 
 electronic fund transfer''; and

    (3) by adding at the end the following:
 ``

    (b) Treatment for Electronic Fund Transfers in Credit 
Extensions.--If a consumer voluntarily agrees to repay an extension of 
a small-dollar consumer credit transaction, as defined in 

section 110

    (a) of the Truth in Lending Act, by means of an electronic fund 
transfer, the electronic fund transfer shall be treated as a 
preauthorized electronic fund transfer subject to the protections of 
this title.''.

SEC. 3. TRANSPARENCY AND CONSUMER EMPOWERMENT IN SMALL-DOLLAR LENDING.

    (a) Small-Dollar Consumer Credit Transactions.--

    (1) In general.--The Truth in Lending Act (15 U.S.C. 1601 
 et seq.) is amended--
        (A) by inserting after 

section 109 (15 U.S.C. 1608) 
 the following:

``

SEC. 110. REGISTRATION REQUIREMENT FOR SMALL-DOLLAR CONSUMER CREDIT 
 TRANSACTION LENDERS.

 ``

    (a) 

=== Definition. ===
-In this section, the term `small-dollar consumer 
credit transaction'--
 ``

    (1) means any transaction that extends credit that is--
 ``
        (A) made to a consumer in an amount that is not 
 more than--
 ``
            (i) $5,000; or
 ``
            (ii) such greater amount as the Bureau 
 may, by rule, determine to reflect changes in 
 the Consumer Price Index for all urban 
 consumers published by the Department of Labor; 
 and
 ``
        (B) extended pursuant to an agreement that is--
 ``
            (i) 
            (I) other than an open end credit 
 plan; and
 ``
            (II) payable in 1 or more installments of 
 less than 12 months;
 ``
            (ii) an open end credit plan in which 
 each advance is fully repayable within a 
 defined time or in connection with a defined 
 event, or both; or
 ``
            (iii) any other plan as the Bureau 
 determines, by rule; and
 ``

    (2) includes any action that facilitates, brokers, 
 arranges, or gathers applications for a transaction described 
 in paragraph

    (1) .
 ``

    (b) Registration Requirement.--A person shall register with the 
Bureau before extending credit to a consumer under a small-dollar 
consumer credit transaction.''; and
        (B) in 

section 173 (15 U.S.C. 1666j), by adding at 
 the end the following:
 ``
            (d) Small-dollar Consumer Credit Transactions.--Notwithstanding 
any other provision of this title, any small-dollar consumer credit 
transaction, as defined in 

section 110

    (a) , shall be made in compliance 
with the laws of the State in which the consumer to which credit in the 
transaction is extended resides with respect to annual percentage 
rates, interest, fees, charges, and such other similar or related 
matters as the Bureau may determine, by rule, if the small-dollar 
consumer credit transaction is--
 ``

    (1) made--
 ``
        (A) over the internet;
 ``
        (B) by telephone;
 ``
            (C) by facsimile;
 ``
            (D) by mail;
 ``
        (E) by electronic mail; or
 ``
        (F) through another electronic communication; or
 ``

    (2) conducted by a national bank.''.

    (2) Technical and conforming amendment.--The table of 
 sections for chapter 1 of the Truth in Lending Act (15 U.S.C. 
 1601 et seq.) is amended by inserting after the item relating 
 to 

section 109 the following:

``110. Registration requirement for small-dollar consumer credit 
 transaction lenders.''.

    (b) Prohibition on Certain Fees.--

Section 915 of the Electronic 
Fund Transfer Act (15 U.S.C. 1693l-1) is amended--

    (1) by redesignating subsection
            (d) as subsection

    (e) ; and

    (2) by inserting after subsection
            (c) the following:
 ``
            (d) Additional Fees Prohibited.--
 ``

    (1) === Definition. ===
-In this subsection, the term `prepaid 
 account' has the meaning given the term in 

section 1005.2 of 
 title 12, Code of Federal Regulations, or any successor 
 regulation.
 ``

    (2) Prohibition.--With respect to the use of a prepaid 
 account by a consumer--
 ``
        (A) it shall be unlawful for any person to charge 
 the consumer a fee for an overdraft with respect to the 
 prepaid account;
 ``
        (B) any transaction for an amount that exceeds 
 the account balance of the prepaid account may be 
 declined by the financial institution holding the 
 prepaid account; and
 ``
            (C) the Bureau may, by rule, prohibit any person 
 from charging a fee with respect to the prepaid account 
 (other than a fee described in subparagraph

    (a) ) so 
 that the Bureau may--
 ``
            (i) prevent unfair, deceptive, or abusive 
 practices; and
 ``
            (ii) promote the ability of the consumer 
 to understand and compare the costs of prepaid 
 accounts.''.

SEC. 4. RESTRICTIONS ON LEAD GENERATION IN SMALL-DOLLAR CONSUMER CREDIT 
 TRANSACTIONS.

    (a) In General.--Chapter 2 of the Truth in Lending Act (15 U.S.C. 
1631 et seq.) is amended by adding at the end the following:
``

Sec. 140B. Restrictions on lead generation in small-dollar consumer 
 credit transactions
 ``

    (a) 

=== Definitions. ===
-In this section--
 ``

    (1) the terms `Internet access service' and `Internet 
 information location tool' have the meanings given those terms, 
 respectively, in 

section 231

    (e) of the Communications Act of 
 1934 (47 U.S.C. 231

    (e) );
 ``

    (2) the term `sensitive personal financial information' 
 means a social security number, financial account number, bank 
 routing number, bank account number, or security or access code 
 that is immediately necessary to permit access to the financial 
 account of an individual; and
 ``

    (3) the term `small-dollar consumer credit transaction' 
 has the meaning given the term in 

section 110

    (a) .
 ``

    (b) Identification Information.--Any person facilitating, 
brokering, arranging for, or gathering applications for the 
distribution of sensitive personal financial information in connection 
with a small-dollar consumer credit transaction shall prominently 
disclose information by which the person may be contacted or 
identified, including for service of process and for identification of 
the registrant of any domain name registered or used.
 ``
            (c) Prohibition on Lead Generation in Small-Dollar Consumer 
Credit Transactions.--No person may facilitate, broker, arrange for, or 
gather applications for the distribution of sensitive personal 
financial information in connection with a small-dollar consumer credit 
transaction unless the person is directly providing the small-dollar 
consumer credit to a consumer.
 ``
            (d) Rule of Construction.--
 ``

    (1) In general.--Nothing in this section may be construed 
 to limit the authority of the Bureau to further restrict 
 activities covered by this section.
 ``

    (2) Clarification.--For the purposes of this section, it 
 shall not be considered facilitating, brokering, arranging for, 
 or gathering applications for the distribution of sensitive 
 personal financial information in connection with a small-
 dollar consumer credit transaction to be engaged solely in one 
 of the following activities:
 ``
        (A) The provision of a telecommunications 
 service, an Internet access service, or an Internet 
 information location tool.
 ``
        (B) The transmission, storage, retrieval, 
 hosting, formatting, or translation (or any combination 
 thereof) of a communication, without selection or 
 alteration of the content of the communication, except 
 the deletion of a particular communication or material 
 made by another person in a manner that is consistent 
 with 

section 230
            (c) of the Communications Act of 1934 
 (47 U.S.C. 230
            (c) ).''.

    (b) Technical and Conforming Amendment.--The table of sections for 
chapter 2 of the Truth in Lending Act (15 U.S.C. 1631 et seq.) is 
amended by adding at the end the following:

``140B. Restrictions on lead generation in small-dollar consumer credit 
 transactions.''.

SEC. 5. STUDIES.

    (a) 

=== Definitions. ===
-In this section--

    (1) the term ``appropriate committees of Congress'' means--
        (A) the Committee on Banking, Housing, and Urban 
 Affairs of the Senate;
        (B) the Committee on Indian Affairs of the Senate;
            (C) the Committee on Financial Services of the 
 House of Representatives; and
            (D) the Committee on Natural Resources of the House 
 of Representatives; and

    (2) the term ``Indian Tribe'' has the meaning given the 
 term in 

section 4 of the Indian Self-Determination and 
 Education Assistance Act (25 U.S.C. 5304).

    (b) Study Required.--Not later than 180 days after the date of 
enactment of this Act, the Comptroller General of the United States 
shall conduct a study regarding--

    (1) the availability of capital on reservations of Indian 
 Tribes; and

    (2) the impact that small-dollar consumer credit extended 
 through internet and non-internet means to members of Indian 
 Tribes has had on economic opportunity and wealth for members 
 of Indian Tribes.
            (c) Consultation.--In conducting the study required under 
subsection

    (b) , the Comptroller General of the United States shall 
consult, as appropriate, with--

    (1) the Bureau of Consumer Financial Protection;

    (2) the Board of Governors of the Federal Reserve System;

    (3) the Director of the Bureau of Indian Affairs;

    (4) federally recognized Indian Tribes; and

    (5) community development financial institutions operating 
 in Indian lands.
            (d) Congressional Consideration.--The Comptroller General of the 
United States shall submit to the appropriate committees of Congress 
the study required under subsection

    (b) .

SEC. 6. RULEMAKING.

 Not later than 1 year after the date of enactment of this Act, the 
Director of the Bureau of Consumer Financial Protection shall adopt any 
final rules that are necessary to implement the provisions of this Act 
and the amendments made by this Act.
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