By Peter Schroeder - 04/12/11 01:34 PM EDT
The letters were sent to lawmakers from Maine, Washington, Massachusetts, New Hampshire, Texas and California — states with large numbers of workers in the technology industry.
"Today, robust protection of financial data is the priority," they wrote. "But under the new regime, cost savings will become the No. 1 priority, a situation that could reduce the incentive for ongoing investments in security infrastructure."
They go on to say the new limits would make it more difficult for banks and other financial institutions to quickly sniff out fraud and other bad actions since they will rely on cheaper networks.
Instead, the group throws its support behind legislation sponsored by Sen. Jon TesterJon TesterOvernight Healthcare: Mylan CEO to defend record on EpiPens | Medical cures bill delayed to lame duck | House GOP hopeful about Zika deal Tribes open new front in fight over pipelines Dem lawmakers: Clinton should have disclosed illness sooner MORE (D-Mont.) that would delay the implementation of the new limits for two years as the matter is studied further. Such a bill presents a "common-sense solution" to the contentious issue, the group said in the letter.
The Federal Reserve, which is charged by the Dodd-Frank financial reform law with setting the new caps, proposed in December that fees be limited to seven to 12 cents per transaction — a major drop from the current industry average of 44 cents.
However, the Fed did suggest in that proposal that the cap could be lifted to accommodate costs tied to certain fraud-prevention practices, but did not delve into specifics, saying it needed more information.
And Federal Reserve Chairman Ben Bernanke has informed lawmakers that the central bank will not meet its statutory deadline of finalizing the rules by April 21, saying it has been overwhelmed by thousands of public comments on the hotly contested issue. Instead, it will work to finish the rules before the limit takes effect in July.