Trump signs executive order scaling back 2010 Dodd-Frank financial regulations
President Donald Trump signed an executive order Friday scaling back the sweeping 2010 Dodd-Frank financial regulatory framework enacted under his predecessor as a direct response to the financial crisis.
White House Press Secretary Sean Spicer labeled the Dodd-Frank Act a “disastrous policy,” in a Friday press briefing. In taking aim at the Act, a thorn in the side of the financial industry since its inception, the new administration is targeting a broad range of financial reforms, ranging from bank rules about speculating with customer funds and wind-down provisions for “too big to fail” institutions to consumer protections from predatory debt collection practices and forced arbitration.
On Monday, Trump had called Dodd-Frank a “disaster” and pledged to soon “do a big number” on the law aimed at reforming the way Wall Street does business.
“President Trump made it clear he wanted to dismantle the Dodd-Frank Act and this is the first salvo in attempting to do so,” said Michael Barr, University of Michigan law professor and editor of the Russell Sage Foundation’s journal, Financial Reform: Preventing the Next Crisis. “I think this is really an attempt at a broad-based assault even on rules that were strongly bipartisan,” he said.
Critics charged that an overhaul would put the interests of banks ahead of consumer protections. “We’re not talking about shifting regulatory regimes,” Mike Konczal, a fellow at the Roosevelt Institute, told NBC News. “This is a unilateral step back to the regulations we’ve done, and it’s likely to be in the space where regulations have been very effective,” he said. “The fact that it is very clearly designed to make industry happy at the expense of consumers is telling.”
Protecting the Consumer
A cornerstone of Dodd-Frank was the creation of the Consumer Financial Protection Bureau, which took oversight of credit cards, mortgages and a host of other financial products and services Americans use on a regular basis.
