TBA hosts Community Banker Roundtable with Secretary Bessent & Comptroller Gould in Houston

In mid-June, TBA hosted Treasury Secretary Scott Bessent and Comptroller of the Currency Jonathan Gould in Houston for important and productive discussions with Texas community bank leaders about critical issues ranging from fighting illicit financial activity to regulatory relief.

Protecting the integrity of America’s financial system was the top issue for Secretary Bessent and Comptroller Gould.

Bessent said a recent Presidential Executive Order “directs Treasury and our regulatory partners to strengthen safeguards against fraud and abuse, improve the detection of illicit financial activity, and ensure that America's financial institutions are not used to facilitate unlawful conduct.” 

He outlined recent financial integrity advisories, stressing the important role of community banks in combatting “unlawful employment schemes, labor brokers, shell companies, payroll tax evasion, identity theft and other forms of financial exploitation.”

“The advisory does not ask banks to become immigration officers,” Bessent said. “It asks banks to do what they do best: know their customers, identify risk, recognize suspicious patterns and report illicit activity when they see it.”

“Treasury is committed to being your partner in that mission,” he said. “Our objective is not to burden community banks with unnecessary requirements, but to provide a regulatory framework that allows institutions to focus resources where the risks are greatest. The good news is that many Texas bankers are already answering this call.”

Comptroller Gould echoed the Secretary’s comments regarding implementation. “The advisory does not create new requirements, but rather provides additional clarity that can help institutions identify unlawful activities that disadvantage honest businesses, divert taxpayer resources and create opportunities for transnational criminal organizations to generate proceeds that continue to fund their activities and traffic ill-gotten profits throughout the United States,” Gould said.

Bankers highlighted their ongoing commitment to work with regulators and law enforcement to vigilantly root out financial crime, while underscoring the importance of ensuring access for legitimate businesses and households.

“Banks like ours have always been the first line of defense against financial crime … not because the regulations require it, but because knowing our customers is the entire model in Texas,” Hazel Davis, VP of Jefferson Bank in San Antonio, said. 

“The framework must be built on one that targets bad actors with precision, preserves access to the regulated banking environment for law-abiding customers and treats community banks as the partners with integrity that we have always been,” Davis said.

TBA President and CEO Chris Furlow said, “The foundation and strength of the Texas banking sector comes from our relationship-driven community banks and midsize institutions. Our banks invest significant resources in fighting fraud, money laundering and other financial crimes. We know our customers and will continue to support families and legitimate businesses. Texas community banks do this every day and look forward to continued engagement with the administration.”

Roundtable participants also discussed the impact that effective financial literacy programs and right-sized regulation can have on supporting stronger banks and a more secure financial system. Frost Bank’s Jacob Cavazos and former TBA Chairman Ford Sasser provided excellent remarks on these issues.

The bankers also spoke about critical issues with the potential to impact community bank deposits, such as stablecoin yield/reward, deposit insurance uncertainty for community and mid-size banks, and the approach for implementing the financial integrity advisories.

There was an exceptional discussion about Texas collaborations to counter fraud and cyber threats that included Director Adam Colby of the Financial Crimes Intelligence Center, Commissioner Charles Cooper of the Texas Department of Banking, and TBA Anti-Fraud Task Force Chairman Ray Vitulli.