BILL ANALYSIS


Financial Institutions Committee
H.B. 1298
By: Carona
March 6, 1995
Committee Report (Amended)


BACKGROUND

Criminal history records from the Texas Department of Public Safety
may be obtained only if a specific authorization is contained in a
statute such as Section 411.092 of the Government Code.  Currently,
the banking commissioner is permitted to obtain such information
for license applicants under the Currency Exchange Act (Article
350, Revised Statutes).

The activities performed under the charters and licenses granted by
the banking commissioner require oversight and enforcement to
protect the public interest.  Criminal history records of
applicants and principals of applicants prior to granting a charter
or license is critical to informed decisionmaking.  The Federal
Deposit Insurance Corporation obtains a report from the Federal
Bureau of Investigation before processing and approving deposit
insurance for a state bank; however, this may occur after the
charter has been approved by the banking commissioner.  The banking
commissioner must be able to check the criminal history of bank
charter applicants during preliminary examination of applications
but prior to approving a charter application.

PURPOSE

In addition to the Currency Exchange Act, the banking commissioner
is charged with the oversight of trust companies, state banks, and
foreign bank agencies under The Texas Banking Code (Article 342-101
et seq., V.T.C.S.), and for licensees of perpetual care cemeteries
(Chapter 712, Health and Safety Code), sale of prepaid funeral
services or funeral merchandise (Article 548b, V.T.C.S.), and the
Sale of Checks Act (Article 489d, V.T.C.S.).

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly
grant any additional rulemaking authority to a state officer,
department, agency or institution.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 411.092(a), Government Code, by adding
specific statutory authority for the banking commissioner to obtain
criminal history information from the Department of Public Safety
regarding an applicant for a charter, or other authority granted or
issued by the banking commissioner under The Texas Banking Code;
The Sale of Checks Act; Chapter 512, Acts of the 54th Legislature,
Regular Session 1955 (sale of prepaid funeral services or funeral
merchandise); and Chapter 712, Health and Safety Code (perpetual
care cemeteries).

SECTION 2. Emergency clause.

EXPLANATION OF AMENDMENTS

Committee Amendment #1:

The Banking Commissioner does not have responsibility for verifying
the character and fitness of any agencies under the Health and
Safety Code, therefore, language regarding the Health and Safety
Code is removed with the adoption of this amendment.



SUMMARY OF COMMITTEE ACTION

The Committee on Financial Institutions convened in a public
hearing on March 6 to consider HB 1298.  Chairman Marchant offered
committee amendment #1 which was adopted without objection.

The following person testified in favor of the bill:  John Heasley. 

The following person testified neutrally on the bill:  Catherine A.
Ghiglieri.

The bill was reported favorably as amended, with the recommendation
that it do pass and be printed and be sent to the Committee on
Local and Consent Calendars, by a record vote of 9 Ayes, 0 Nays, 0
PNV, Absent, 0.