Overnight Regulation

Overnight Regulation: Senators to grill Wells Fargo, Equifax CEOs | FDA sued over ingredient in teething meds | Court tosses fracking lawsuit

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Welcome to Overnight Regulations, your daily rundown of news from the federal agencies, Capitol Hill and the courts. It’s Thursday evening here in Washington where a vote on a last-ditch measure to repeal and replace ObamaCare could come next week in the Senate. Find out who’s on board here.  

Here’s the latest:



Senators will get a chance next month to grill the CEOs of Wells Fargo and Equinox, two companies rocked by scandal in recent months. 

Wells Fargo CEO Timothy Sloan is sure to face questions when he testifies on Oct. 3 about how 3.5 million Wells Fargo accounts were opened without customers’ consent.


The Federal Reserve, Justice Department and several state agencies are investigating Wells Fargo, and the Consumer Financial Protection Bureau fined the bank more than $180 million in 2016, its biggest penalty yet issued.The following day, Equifax CEO Richard Smith will have to answer on why it took months for the credit reporting company to disclose a massive breach of financial data that could affect as many as 143 million Americans. 

The Justice Department is reportedly probing stock trades made by Equifax executives before the breach was disclosed. The company denies the executives did anything wrong.

As Sylvan Lane reports, Wells Fargo and Equifax have been constant punching bags for lawmakers on both sides. Fireworks during the hearing are likely to come from Sens. Elizabeth Warren (Mass.) and Sherrod Brown (Ohio), two of the Senate’s leading critics of the financial industry. 

Warren is a top 2020 presidential hopeful for Democrats, while Brown, whom Hillary Clinton reportedly considered for her running mate last year, is running a tight race for re-election in 2018.

Read the full story here.



Consumer safety: Public Citizen is suing the Food and Drug Administration (FDA) for not responding to its petition to regulate an ingredient found in over-the-counter medicines for teething babies.

The liberal advocacy group says in a complaint filed in the U.S. District Court for the District of Columbia on Thursday that the FDA has failed to act on its 2014 petition to revise labeling requirements and limit the legal uses of over-the-counter oral health-care products that contain benzocaine.

The group claims the ingredient, often found in products to treat teething pain, is linked to methemoglobinemia, a life-threatening blood disorder that impairs the body’s ability to use oxygen.

Read the full story here


Environment:  A federal appeals court has dismissed a lawsuit over the validity of a hydraulic fracturing regulation instituted by the Obama administration.

The 10th Circuit Court of Appeals ruled Thursday that a lawsuit over the rule is unnecessary because the Trump administration is working to repeal the rule.

The court also vacated a lower judge’s ruling that the Bureau of Land Management had overstepped its bounds by trying to regulate fracking.

It is a victory for environmentalists as the lower court’s ruling would have made it difficult for future administrations to write new fracking regulations.

The fracking rule was an Obama administration effort to update oil and natural gas drilling regulations on federal land. The 2015 rule won support from environmentalists, but drilling interests and some Western states said it would be costly to implement and create duplicative regulations.

Devin Henry has the story here


Tech: Senate Democrats are asking the Federal Communications Commission to delay its efforts to repeal the Obama-era net neutrality regulations in order to review a trove of recently released documents related to the matter. 

The nine lawmakers, led by Sen. Edward Markey (D-Mass.) wrote to FCC Chairman Ajit Pai asking if the new documents had been taken into account by the agency when deciding to roll back the rule. 

“Although the Commission has undertaken an historic proceeding to undo the Open Internet Order, the FCC has failed to provide stakeholders with an opportunity to comment on the tens of thousands of filed complaints that directly shed light on proposed changes to existing net neutrality protections,” the letter reads.

Pai’s office declined to comment.

Last week, the FCC handed over 70,000 pages of documents in response to a Freedom of Information Act request from the National Hispanic Media Coalition. The group had requested all complaints filed by consumers about violations of the net neutrality rules since they went into effect in 2015.

Harper Neidig has the story here


Civil rights: A civil rights group on Thursday called on members of the Senate Judiciary Committee to question Attorney General Jeff Sessions at an oversight hearing next month about the Department of Justice’s connection to President Trump’s voter fraud commission.

Kristen Clarke, president and executive director of the Lawyers’ Committee for Civil Rights Under Law, urged the senators in a statement to “closely examine evidence” that DOJ’s Civil Rights Division is engaged in collusion with the Presidential Advisory Commission on Election Integrity.

“The goals of the Commission are fully antithetical to the mission of the Division, which is charged with fighting — not prompting — voter suppression,” she said.

Senate Judiciary Chair Chuck Grassley (R-Iowa) announced on Wednesday that Sessions is scheduled to appear before the Senate committee for DOJ’s annual hearing on Oct. 18.

Trump created the commission to investigate his claims of voter fraud in last year’s presidential election.

Find the story here


Environment: Environmental Protection Agency (EPA) employees are undergoing mandatory classes as part of a Trump administration effort to stop unauthorized disclosures to the press.

“Enemies of the United States are relentless in their pursuit of information which they can exploit to harm U.S. interests,” according to a three-page fact sheet given to workers.

Materials given to some of the employees, which were obtained by The Hill, use stark terms to warn about the consequences of leaking information.

Few EPA employees handle classified information, but agency leadership is also trying to ensure that workers do not disclose “controlled unclassified information.”

Timothy Cama has the story here.


Finance: The Securities and Exchange Commission (SEC) revealed Wednesday that hackers breached its system for public-company filings and may have profited from stolen insider information.

SEC Chairman Jay Clayton said in a statement that hackers exploited a software vulnerability in the regulator’s EDGAR filing system. That breach was discovered in 2016, he said, but the SEC did not learn about the possibility of unlawful trading until 2017.

The SEC says the software flaw was quickly patched, and that no sensitive personal information, such as credit card or Social Security numbers, was exposed in the breach.

Sylvan Lane and Max Greenwood have more here.



Safety board: Undiagnosed sleep apnea involved in two NY train crashes

States move to restrict domestic abusers from carrying guns – The Washington Post 

Trump’s antitrust chief nomination is held up in Senate – The Wall Street Journal 

Hack of Wall Street regulators rattles investors, lawmakers – Reuters 

Can transgender students go to women’s college? Across the country, the answer is evolving –Vox 


Send tips and story pitches to your Overnight host Lydia Wheeler at lwheeler@thehill.com and follow her on Twitter @wheelerlydia.

Tags Chuck Grassley Edward Markey Elizabeth Warren Hillary Clinton Jeff Sessions Sherrod Brown

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