House passes bill to undo much of landmark banking law
- Author: Zachary Reyes Jun 16, 2017,
Jun 16, 2017, 6:40
It would also see an end to state-fund bank bailouts by eliminating the Federal Deposit Insurance Corporation's orderly liquidation authority and establishing new provisions regarding financial institution bankruptcy.
House Resolution 10, or the Financial Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs (CHOICE) Act of 2017, passed by a vote of 233-186 in the lower chamber Thursday afternoon.
But many critics of the bill say removing protections and oversight of lending institutions would invite a resurgence of predatory lending practices and allow mortgage loans to be made to home buyers who can not afford them. The chances of passage are uncertain, considering the strategy of Senate Democrats to obstruct everything that Republicans propose, no matter what the merits.
The bill, headed by House Financial Services Chairman Jeb Hensarling (R-TX), passed the House with almost full Republican support, but its chances in the Senate are looking grim, according to Democratic leaders.
"Jeb Hensarling [R-Texas] & Republicans on successful House vote to repeal major parts of the 2010 Dodd-Frank financial law", Trump tweeted.
Prior to this week's House vote, McCarthy said the Financial Choice Act "will revive our community banks by removing burdens that prevent lending, and improving their access to credit and capital".
The U.S. Senate is not expected to take up the bill in its entirety, even though it has the backing of President Donald Trump, largely because of the threat that Democrats will use a filibuster to stall it. The bill will be especially useful for smaller, community banks who have traditionally lent money to small business startups.
Sewell continued, "Between the home foreclosures, rising unemployment, and the families whose dreams were stripped away to pay for Wall Street's mistakes, it is hard to forget".
The bill would also remove the fiduciary rule, scheduled to into affect this week, that adds tough new requirements for brokers and investment advisors to act in the best interests of their clients when dealing with retirement accounts. Dodd-Frank became the centerpiece of those reforms.
Democrats strongly oppose the bill, dubbing it "the wrong choice act". They have expressed concern that an inadequately regulated financial sector could lead to risky decisions similar to what contributed to the financial crisis. "There is literally no one who is helped by repeal of the Volcker Rule except big banks", Yarmuth said.
Require an audit of all operations of the Federal Reserve.