Overhaul of US Financial System Impending

Jun 28th, 2010 | By | Category: Senior Finances

Congress is poised to pass the Dodd-Frank Bill, financial overhaul legislation, this week.  It is expected to be on President Obama’s desk by July 4.  Many financial and political experts call it long overdue, taking “…a crisis to bring us to the point where we could actually get this job done, ” said Senator Chris Dodd last week.

Although last minute compromises removed some language that would have tackled the mortgage giants, Fannie Mae and Freddie Mac, the legislation remains a full sweep of the financial regulation issues that have plagued this nation for many years.  It is expected to get final House approval this week.

According to the AP wire service, the bill includes:

  • A new agency to protect consumers in the financial marketplace;
  • A council of regulators to monitor the financial system for major risks;
  • Tough regulations on complex financial derivatives;
  • Government authority to seize and dismantle teetering companies whose failure would pose a danger to the overall economy;
  • Rules that would prohibit mortgage loans written with no documentation of the borrowers’ income.

Most experts agree that the long-term benefit of this legislation will be to tighten scrutiny of Wall Street and the United States Financial system, and create a consumer watchdog functionary that will help protect the American public from the scams that caused the financial melt-down in 2008.

More information can be found by searching ‘dodd frank bill’ in your favorite search engine, or here on the Washington Post web site.

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