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HR 10230

Strengthening Oversight for the Financial Sector Act of 2026

119th Congress Introduced by Bill Foster

The act expands FHFA oversight to regulate and examine service providers performing outsourced activities for GSEs and FHLBanks, with 30-day notice to FHFA.

Introduced in House
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WeVote Research Nonpartisan
Bill Summary · HR 10230

Summary of HR 10230 — Strengthening Oversight for the Financial Sector Act of 2026

Purpose and intent

  • Establishes expanded regulatory oversight mechanisms for certain financial entities and their service providers.
  • Grants the Director of the Federal Housing Finance Agency (FHFA) authority to regulate the provision of services to Government-sponsored enterprises (GSEs) and Federal Home Loan Banks (FHLBanks).
  • Aims to enhance supervision and examination of credit unions and external service providers that perform activities for regulated entities.

Key provisions and changes

1) Regulation and examination of credit union organizations and service providers (Federal Credit Union Act)
- Amends Section 206A of the Federal Credit Union Act.
- Specific textual changes:
- Subsection (a)(1): Replaces the word “that” with “an” in a defined regulatory context (clarifying scope of regulation).
- Subsection (c)(2): Requires that notification to the Board about certain matters be made “in a manner and method prescribed by the Board.”
- Subsection (f): Entire subsection is repealed (removal of a provision, the practical effect of which would depend on the original text).

2) Regulation of service providers by the FHFA
- Adds a new statutory provision to the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (FHFS Act), creating a new Section 1329: Regulation and Examination of Certain Service Providers.
- Core requirements under proposed Section 1329:
- General rule: If a regulated entity (e.g., a GSE or Office of Finance) or its service relationships contract out activities that are permissible for the entity, the performance of those activities by the service provider is subject to regulation and examination by the FHFA Director as if performed by the entity itself.
- Notice obligation: The regulated entity or Office of Finance must notify the FHFA Director within 30 days after the service contract is established or the service activity begins, whichever occurs first.
- Construction/State authority: The provision does not limit state regulatory powers; states may continue to exercise jurisdiction over persons or entities regulated and examined by the FHFA Director.

Who/what is affected

  • Credit unions and their governance/regulatory framework:

    • Changes to how certain regulation and examination matters are described and notified within the Federal Credit Union Act.
    • Potentially broader or clarified oversight of outsourcing activities by credit unions.

  • Service providers to regulated entities (credit unions, GSEs, and FHLBanks):

    • Service providers performing activities for regulated entities will be subject to FHFA regulation and examination when those activities are permissible for the entity.
    • Requires notification of service arrangements to the FHFA Director within 30 days.

  • Federal Housing Finance Agency (FHFA):

    • Receives explicit authority to regulate and examine outsourced activities performed for GSEs and FHLBanks, expanding its oversight reach.

Procedural and timeline aspects

  • Introduction and referral:

    • Introduced September 2, 2026 by Rep. Foster.
    • Referred to the House Committee on Financial Services.

  • Effective dates:

    • The text provided does not specify explicit effective dates; typical implementation would follow committee and floor action, with regulatory agencies setting effective dates via rulemaking if enacted.

Potential impacts and considerations

  • Increased oversight burden on credit unions and service providers:

    • Service arrangements must be disclosed to the FHFA Director within 30 days of contract/performance commencement.
    • Service providers could face new regulatory scrutiny and examinations.

  • Clarity in regulatory processes:

    • Revisions to notification requirements to the Federal Credit Union Board may streamline or modify how regulatory communications are conducted.

  • State versus federal regulatory balance:

    • The bill preserves a State power construction, allowing states to exercise their own regulatory authority in addition to FHFA oversight.

  • Scope of impact:

    • The combination of credit union regulation changes and FHFA service-provider regulation could affect a wide range of outsourced activities across credit unions and GSE/FHLBanks-related operations.

If you’d like, I can provide a side-by-side comparison of current law versus the proposed changes, or outline potential compliance steps for financial institutions that might be affected.

Compiled from official sources — confirm details with the bill’s official record.

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