Hagerty Calls on Bank Regulators to Reform Confidential Supervisory Information Practices

Pursuant to Senate Policy, petitions, opinion polls and unsolicited mass electronic communications cannot be initiated by this office for the 60-day period immediately before the date of a primary or general election. Subscribers currently receiving electronic communications from this office who wish to unsubscribe may do so here . Home About Biography Committee Assignments Services Agency Help Academy Nominations Veterans Resources Student Resources Internships Flag Request Judicial Appointments Schedule A Meeting Visiting DC Grant Help Tennessee Tuesdays Legislation Introduced Co-Sponsored Newsroom Press Releases Columns/Op-Eds Hagerty Hits Press Packet Subscribe to Hagerty Happenings Contact Bill Email Bill Office Locations Newsletter Signup Follow Follow Follow Follow Hagerty Calls on Bank Regulators to Reform Confidential Supervisory Information Practices June 24, 2026 Long-overdue reforms will improve transparency and accountability in bank supervision. WASHINGTON — On Tuesday, United States Senator Bill Hagerty (R-TN), a member of the Senate Banking Committee, sent a letter to Vice Chairman for Supervision of the Federal Reserve Board of Governors Michelle Bowman, Comptroller of Currency Jonathan Gould, Chairman of the Federal Deposit Insurance Corporation Travis Hill, and Acting Director of the Consumer Financial Protection Bureau Russell Vought encouraging them to reform the rules governing the handling of confidential supervisory information (CSI). In recent years, overly restrictive rules governing the sharing of CSI have been exploited to stonewall congressional oversight, impose hostile supervisory agendas on disfavored industries, and prevent banks from voluntarily disclosing information to third parties in the ordinary course of business. Reviewing and reforming these rules and practices will strengthen accountability and transparency in bank supervision. A copy of the letter can be found here and below: Dear Vice Chairman Bowman, Comptroller Gould, Chairman Hill, and Acting Director Vought: Under your leadership, the Administration and financial regulators have taken significant and long-overdue steps to improve the accountability and transparency of bank supervision. To further these efforts, I urge you to review and reform the rules and practices governing the disclosure of confidential supervisory information (CSI). Confidentiality is a useful part of the supervisory process. Examiners often review proprietary business information and sensitive risk-management materials that should not be casually disclosed. An appropriate level of confidentiality facilitates candid engagement between regulators and the institutions they oversee. However, the application of CSI rules by banking agencies and the CFPB has been far too expansive in recent years. These rules have deterred banks from sharing information with parties that have legitimate, and often essential, reasons to access it. For example, existing rules and agency practices limit banks from sharing information with other parties, including outside counsel, auditors, consultants, third-party service providers, and potential counterparties in a merger, acquisition, or similar transaction. Under the status quo, banks are also restrained from sharing CSI with the Secretary of the Treasury. [1] This prevents supervised institutions from sharing details of their concerns with the Department, an unnecessary constraint that makes it more difficult to advance regulatory and supervisory policies. In addition to these overly burdensome and impractical restrictions, the expansive application of CSI rules has been abused in recent years to facilitate major policies without any semblance of accountability or congressional oversight. In the worst cases, the veil of confidentiality has been exploited to disfavor lawful industries and to impose partisan policy preferences without statutory authorization. For example, under former FDIC Chairman Marty Gruenberg, the agency told banks to “pause” or “refrain from providing” digital asset banking services. [2] According to current Chairman Travis Hill, Gruenberg’s supervisory letters effectively signaled that the agency was “closed for business if institutions are interested in anything related to blockchain or distributed ledger technology.” [3] Because the letters were labeled as CSI, recipient banks were effectively barred from making them public, limiting their opportunities to seek legal recourse and alert Congress and the public to the agency’s actions. Many institutions suspended or abandoned crypto- and blockchain-related activities. [4] The practical effect was that, without any statutory authorization, a federal regulator exploited CSI rules as a channel to suppress lawful activity in an emerging industry. In other instances, appeals to CSI have been exploited to stonewall congressional oversight. In 2022, a Federal Reserve Bank president cited CSI as a reason for denying Senator Pat Toomey, the Ranki