Financial Data Transparency Act


What is it?
  • On May 24, 2022, the Financial Data Transparency Act (S. 4295) was introduced by U.S. Senators Mark R Warner (D-VA) and Mike Crapo (R-ID) as legislation to improve the accessibility and transparency of information published by US financial regulatory agencies.
  • Similar legislation was introduced by Reps. Carolyn Maloney (D-NY) and Patrick McHenry (R-NC) in the House of Representatives (H.R. 2989) in May 2021 and was passed by a 400-19 vote on October 25, 2021.
  • The language was included in the Fiscal Year 2023 National Defense Authorization Act (NDAA) which passed into law in December 2022. 

What does it do?
  • Requires the major U.S. financial regulators to adopt and implement uniform and non-proprietary data standards to collect and disseminate information. The data standards will include common legal identifiers for financial products, instruments, and transactions.
  • In addition to the U.S. Department of Treasury, the seven major regulators will develop the new standards:
    • The Federal Reserve
    • The Securities and Exchange Commission (SEC)
    • The Federal Deposit Insurance Corporation (FDIC)
    • The Office of the Comptroller of the Currency (OCC)
    • The Consumer Financial Protection Bureau (CFPB)
    • The Federal Housing Finance Agency (FHFA
    • The National Credit Union Administration (NCUA)
  • Information that needs to be published under existing laws needs to be made available in an open data format that facilitates digital access and bulk downloads with no restrictions.
  • The Act does not require new disclosure.

How does this affect state government?
  • Of note is the requirement that the Securities and Exchange Commission issue data standards for information that municipal securities issuers provide to the Municipal Securities Rulemaking Board and have the information be machine readable.
  • State and local governments that issue bonds are required to provide both primary and continuing disclosure to the Municipal Securities Rulemaking Board’s Electronic Municipal Market Access (EMMA). Financial data including Annual Comprehensive Financial Reports (ACFRs) are included in municipal market information submitted to EMMA. 
  • How the law is ultimately implemented regarding municipal market information will be determined by the SEC.

The NASACT Community

NASACT serves as the premier organization working to bring together state auditors, state comptrollers and state treasurers to cooperatively address government financial management issues. NASACT also manages two secretariats - the National State Auditors Association (NSAA) and the National Association of State Comptrollers (NASC). Both NSAA and NASC are included under the umbrella of NASACT’s budget and utilize staff hired by NASACT.