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The Obama administration today threatened to veto a House spending plan that would limit fiscal 2012 funding for the Securities and Exchange Commission and Consumer Financial Protection Bureau.
The Office of Management and Budget said it would recommend that the president veto a financial services spending bill that has been approved by the Republican-led House Appropriations Committee and is still making its way through Congress, The Hill reported. The House bill would limit CFPB funding to less than half the $550 million the Dodd-Frank law set as its funding, a cut that OMB said would “severely undercut” its ability to police consumer financial services.
The House bill would keep SEC funding flat in 2012, rejecting a $222 million increase requested by the White House to pay for the agency's additional Dodd-Frank responsibilities. The SEC is funded by fees that it assesses on financial transactions, and the agency now generates more in fees than it spends.
Kill Dodd-Frank, kill the economy - The Dodd-Frank reform law is necessary to protect the U.S. economy in the future, a top Treasury Department official said today.
"Scaling back or repealing major parts of the Dodd-Frank Act, or not providing regulators with the funds they need to implement the Act, will leave our economy exposed to a cycle of collapses and crises," said Mary Miller, Treasury’s assistant secretary for financial markets.
Miller spoke at a Securities Industry and Financial Markets Association regulatory reform event to mark the July 21 one-year anniversary of the Dodd-Frank Act.
Bank of America mortgage settlement - New York Attorney General Eric Schneiderman is questioning Bank of America’s $8.5 billion settlement with 22 big investment funds, raising concerns that the deal may have been struck without full participation from all affected investors.
Schneiderman sent letters to BlackRock Inc., Metropolitan Life Insurance, Pimco, Goldman Sachs Group Inc. and 18 others asking about “participation by both your firm and clients” in the settlement over soured mortgage securities. The New York Times reported the inquiry is the latest in Schneiderman’s broader investigation in the mortgage bundling process, which has led to billions of losses for investors.
With Dodd-Frank, TBTF lives on – While the Dodd-Frank law was intended to end banks that are “too big to fail,” the federal government could end up rescuing mega-banks once again during the next crisis, Standard & Poor’s said in a report.
The rating agency pointed to the government’s history of propping up major financial firms and said that its promises to end future bailouts are hollow. "We believe that under certain circumstances and with selected systemically important financial institutions, future extraordinary government support is still possible," S&P said.
Blowing the whistle – Cash incentives to encourage whistleblowers to report suspected fraud are on the agenda when the Commodity Futures Trading Commission meets next week.
The CFTC last November proposed a set of whistleblower rules that closely resembled the Securities and Exchange Commission’s reward plan for tipsters. The CFTC proposal would pay a whistleblower 10 to 30 percent of sanctions collected by the agency and protect the tipster from retaliation from an employer.
Reprinted by Permission © 2012, The Center for Public Integrity®. All Rights Reserved.
