House approves partial repeal of Dodd-Frank Act

House approves partial repeal of Dodd-Frank Act

The House voted along party lines Thursday to repeal numerous stricter regulations enacted after the 2008 financial crisis, taking the first step in a long-held Republican desire to roll back landmark rules they complain are hurting banks, restricting consumer credit and slowing economic growth. House Republicans headed toward a vote June 8, 2017, on dismantling sweeping financial rules established under Obama that were created to head off economic meltdowns.

Republicans argue that rules created to prevent another meltdown were making it harder for community banks to operate and hampering the economy. Instead, Dodd-Frank reins in the hugely diverse, interconnected financial world ― banks, hedge funds, mortgage originators, insurance companies, debt collectors, payday lenders ― by creating dozens and dozens of new rules, processes and organizations.

The Financial CHOICE Act undercuts several major provisions in Dodd-Frank, including the Consumer Finance Protection Bureau, an independent agency now empowered to protect consumers from deceptive banking practices through fines, lawsuits and market rules. Trump called the law a "disaster" whose restrictions have crimped lending, hiring and the overall economy. It could provide a blueprint for regulators to rewrite the rules. But it would take legislation to revamp the law — and that's far from a certain prospect.

In a near party-line vote, the House approved a bill, dubbed the Financial Choice Act, , which scales back or eliminates numerous post-crisis banking rules.

They say the biggest banks are only getting bigger while local banks are struggling. In exchange, such banks would gain exemptions or eased requirements for "stress tests" to assess their ability to withstand a downturn and for their plans to reshape themselves if they failed. That way, even if they run into financial trouble, the banks should have enough money to survive without taxpayers' help, supporters of the bill say. It wiped out trillions of dollars worth of household wealth across America.

"Millions of Americans lost their homes, their jobs, and their savings when Wall Street crashed the economy in 2008". They said the CFPB changes, including eliminating its complaints database, would make it easier for firms to take advantage of consumers along the lines of the housing crisis, where millions were trapped in mortgages they could not afford. Economists back Trump adviser pick GOP lawmaker invites colleagues to Capitol shooting range MORE (R-Idaho) appears focused on a bipartisan measure to relieve regulations on smaller banks. The consolidation trend, however, far preceded that law. Many have expressed particular concern over a provision that would curtail the powers of the Consumer Financial Protection Bureau, and reduce its independence by having its director report to the president.

The Choice Act explicitly states that it intends to "demand greater accountability and transparency from the Federal Reserve, both in its conduct of monetary policy and its prudential regulatory activity". Instead, it would depend on Congress for its funding just as most federal agencies do.

Democratic lawmakers are overwhelmingly opposed to the bill, which also faces major obstacles in the Senate. The Consumer Financial Protection Bureau has returned $29 billion to 12 million consumers who were victims of deceptive marketing, discriminatory lending or other financial wrongdoing. Since Dodd-Frank was signed into law, $36 billion in regulatory fees have been imposed on our economy.

Next, the Financial CHOICE Act ends tax-payer funded big bank bailouts by holding failing financial institutions accountable through bankruptcy, not bailouts. And it must submit to close supervision by the Federal Reserve and make more detailed disclosures. The most powerful Democrat in the chamber, California's Nancy Pelosi, described the legislation as "dastardly".

The legislation would repeal the Obama-era Labor Department's so-called fiduciary rule. According to some estimates, the Fiduciary rule could double retirement savers' cost.

Crafted by House Financial Services Chairman Jeb Hensarling, the bill passed despite vehement objections by Democrats to preserve the sweeping law aimed at preventing another financial crisis and protecting American consumers.

Shareholders with relatively small portions of company stock would find it harder to bring proposals to a vote by all shareholders. Rather than hold a nonbinding vote at least once every three years, the legislation would allow it only when executives' compensation has changed "materially" from the previous year. That compares with the current requirement of $2,000 worth of stock for one year.

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