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As of September 29, 2023, there are 5005 open recommendations that still need to be addressed. 521 of these are priority recommendations, those that we believe warrant priority attention. Learn more about our priority designation on our Recommendations page.

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1 - 9 of 9 Recommendations, including 4 Priority Recommendations
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Blockchain in Finance: Legislative and Regulatory Actions Are Needed to Ensure Comprehensive Oversight of Crypto Assets

GAO-23-105346
Michael Clements
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1 Open Recommendations
1 Priority
Agency Recommendation Status
Federal Reserve System
Priority Rec.
This is a priority recommendation.
The Chair of the Board of Governors of the Federal Reserve System should jointly establish or adapt an existing formal coordination mechanism with CFPB, CFTC, FDIC, NCUA, OCC, and SEC for collectively identifying risks posed by blockchain-related products and services and formulating a timely regulatory response. To facilitate these objectives, this mechanism could include formal planning documents that establish the frequency of meetings and processes for identifying risks and responding to them within agreed-upon time frames. (Recommendation 4)
Open

The Federal Reserve neither agreed nor disagreed with the recommendation. In its agency comment letter, the Federal Reserve said it routinely engages with the other federal financial regulators on emerging risks posed by blockchain-related products and services. However, the regulators' coordination efforts have not always addressed risks posed by crypto assets in a timely manner. We maintain that a formal coordination mechanism focused on collectively identifying risks posed by blockchain-related products and services and formulating timely regulatory responses could improve protections for

Privacy: Federal Financial Regulators Should Take Additional Actions to Enhance Their Protection of Personal Information

GAO-22-104551
Nick Marinos, Alicia Puente Cackley
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4 Open Recommendations
Agency Recommendation Status
Federal Reserve System The Chair of the Federal Reserve should define a process for documenting the actions the Federal Reserve takes to minimize collection and use of PII. (Recommendation 2)
Open

In July 2022, the Board of Governors of the Federal Reserve System detailed actions it planned to take to address this recommendation. We will continue to be in contact with the Board to gain further information on these actions and progress toward their completion.
Federal Reserve System The Chair of the Federal Reserve should include information from systems maintained by Federal Reserve contractors in the Federal Reserve's inventory of information systems that handle PII. (Recommendation 3)
Open

In July 2022, the Board of Governors of the Federal Reserve System detailed actions it planned to take to address this recommendation. We will continue to be in contact with the Board to gain further information on these actions and progress toward their completion.
Federal Reserve System The Chair of the Federal Reserve should identify and specify metrics to determine whether privacy controls are implemented correctly and operating as intended. (Recommendation 4)
Open

In July 2022, the Board of Governors of the Federal Reserve System detailed actions it planned to take to address this recommendation. We will continue to be in contact with the Board to gain further information on these actions and progress toward their completion.
Federal Reserve System The Chair of the Federal Reserve should establish a timeframe for including information on privacy controls to be tested within the Federal Reserve's written privacy continuous monitoring strategy. (Recommendation 5)
Open

In July 2022, the Board of Governors of the Federal Reserve System detailed actions it planned to take to address this recommendation. We will continue to be in contact with the Board to gain further information on these actions and progress toward their completion.

Financial Technology: Agencies Should Provide Clarification on Lenders' Use of Alternative Data [Reissued with revisions on Mar. 12, 2019.]

GAO-19-111
Michael Clements
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1 Open Recommendations
1 Priority
Agency Recommendation Status
Federal Reserve System
Priority Rec.
This is a priority recommendation.
The Chair of the Board of Governors of the Federal Reserve System should, in coordination with the other federal banking regulators and the Bureau of Consumer Financial Protection and with input from relevant stakeholders, communicate in writing to banks that engage in third-party relationships with fintech lenders on the appropriate use of alternative data in the underwriting process, including issues to consider when selecting types of alternative data to use. (Recommendation 2)
Open

In December 2019, the Board of Governors of the Federal Reserve System (the Federal Reserve), the Consumer Financial Protection Bureau, the Federal Deposit Insurance Corporation, the National Credit Union Administration, and the Office of the Comptroller of the Currency (the agencies) issued an interagency statement on the use of alternative data in credit underwriting. The statement broadly highlights some potential benefits and risks of using alternative data and encourages firms to responsibly use alternative data. However, the statement does not provide firms or banks with specific

Financial Services Regulations: Procedures for Reviews under Regulatory Flexibility Act Need to Be Enhanced

GAO-18-256
Lawrance L. Evans, Jr.
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1 Open Recommendations
Agency Recommendation Status
Federal Reserve System The Federal Reserve should develop and implement specific policies and procedures for how it will consistently comply with RFA requirements and key aspects of Office of Advocacy and OMB guidance that include the following three elements: (1) processes for creating and maintaining documentation sufficient to support analysis of economic impact and alternatives; (2) processes for disclosing the methodology--including criteria for assessing significant economic impact and a substantial number of small entities--and data sources of economic analysis supporting certification determinations and regulatory flexibility analyses; and (3) processes for considering to the extent practicable a rule's potential economic impacts on small entities, including for evaluating broad economic impacts of regulations in certification determinations and assessing alternatives that could minimize impact on small entities. (Recommendation 5)
Open

In June 2019, Federal Reserve staff told us that they continue to review their policies and procedures to ensure compliance with RFA requirements. While Federal Reserve staff said that they use an RFA handbook developed by the SBA Office of Advocacy to support their analyses, the Federal Reserve has not made changes to its policies and procedures based on our recommendations. Until the Federal Reserve develops and implements RFA policies and procedures consistent with the recommendation, it remains open.

Federal Reserve: Additional Actions Could Help Ensure the Achievement of Stress Test Goals

GAO-17-48
Lawrance L. Evans, Jr.
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2 Open Recommendations
2 Priority
Agency Recommendation Status
Federal Reserve System
Priority Rec.
This is a priority recommendation.
To improve the Federal Reserve's ability to manage model risk and ensure that decisions based on supervisory stress test results are informed by an understanding of model risk, the Federal Reserve should design and implement a process to communicate information about the range and sources of uncertainty surrounding the post-stress capital ratio estimates to the Board during CCAR deliberations.
Open

In January 2019, the Federal Reserve said it had previously initiated a project to design and implement a process to communicate uncertainty surrounding the post-stress capital ratio estimates. In February 2022, the Federal Reserve provided information about its process to communicate model risk and uncertainty analysis results. To fully implement our recommendation, the Federal Reserve needs to complete its process to communicate uncertainty surrounding the post-stress capital ratio estimates to the Board. We will continue to monitor the Federal Reserve's completion and implementation of this
Federal Reserve System
Priority Rec.
This is a priority recommendation.
To improve the Federal Reserve's ability to manage model risk and ensure that decisions based on supervisory stress test results are informed by an understanding of model risk, the Federal Reserve should design and implement a process for the Board and senior staff to articulate tolerance levels for key risks identified through sensitivity testing and for the degree of uncertainty in the projected capital ratios.
Open

In January 2019, the Federal Reserve said it had previously initiated a project to respond to our recommendation. In February 2022, the Federal Reserve provided information about its process to communicate model risk and approve supervisory stress test models, including discussion of model risk tolerance. To fully implement our recommendation, the Federal Reserve's process needs to provide for the Board and senior staff to articulate tolerance levels for risks identified through sensitivity testing and the degree of uncertainty in the projected capital ratios. We will continue to monitor the

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For questions about a specific recommendation, contact the person or office listed with the recommendation. For general information about recommendations, contact GAO's Audit Policy and Quality Assurance office at (202) 512-6100 or apqa@gao.gov.