A Free State
By: Mark Uncapher

Hidden away in a corner of bureaucratic Washington, DC, the Biden administration’s regulators sought to remake consumer finance by turning a single 300-word section of the 2010 Dodd-Frank Act into an expansive regulatory regime.

Congress adopted Section 1033 with a straightforward purpose. The provision gives consumers the right to access their own financial data. Lawmakers intended to ensure that individuals could obtain account information from financial institutions and use it as they saw fit. The statute was about consumer access, not about restructuring the financial services marketplace.

However, the Biden Consumer Financial Protection Bureau attempted to stretch Section 1033 to take greater control over consumer banking services. The agency sought to construct a sweeping “open banking” regime that would require banks, credit unions, and financial technology firms to share customer data with numerous third-party companies.

This raises a legal question: Does Section 1033 authorize such mandates? The statute grants consumers the ability to obtain their data. It does not clearly authorize a federal agency to design a nationwide data-sharing infrastructure across the financial sector.