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☆ Wall St regulator adopts Dodd Frank rule against trader conflicts
▼ + stars: | 2023-11-27 | by ( ) www.reuters.com time to read: +2 min

The seal of the U.S. Securities and Exchange Commission (SEC) is seen at their headquarters in Washington, D.C., U.S., May 12, 2021. The SEC move is mandated by the Dodd Frank law, aimed at eradicating behavior seen in the 2008 global financial crisis. The rule is among the last to be adopted under 2010's Dodd Frank Wall Street reform legislation and faced a winding road to completion. Parties covered by the rule include underwriters, placement agents and sponsors for asset-backed securities. The SEC says it will require compliance with the rule for asset-backed securities with closing dates falling 18 months after the rule appears in the Federal Register.

Persons: Andrew Kelly, Dodd Frank, Dodd Frank Wall, Gary Gensler, Hester Peirce, Goldman Sachs, Douglas Gillison, David Gregorio, Marguerita Choy Organizations: U.S . Securities, Exchange Commission, Washington , D.C, REUTERS, SEC, Republican, Senate, Federal Register, Thomson Locations: Washington ,

☆ Bankman-Fried circus will be a singular clown show
▼ + stars: | 2023-10-04 | by ( Anita Ramaswamy | ) www.reuters.com time to read: +3 min

NEW YORK, Oct 4 (Reuters Breakingviews) - All eyes are on Sam Bankman-Fried as the cryptocurrency founder’s criminal trial gets underway this week. The high-profile case bears similarities to past scandals such as Enron and Countrywide Financial, when regulation followed investigations. Lawmakers hauled Wall Street analysts up to Capitol Hill to grill them about their “buy” ratings. Importantly, legislators passed the Dodd-Frank Wall Street Reform and Consumer Protection Act, forcing banks to hold more capital, among other stipulations. It also is less prevalent – less than 20% of Americans have invested in crypto, according to the Pew Research Center.

Persons: Sam Bankman, FTX’s, Ken Lay, Arthur Andersen, Dodd, Frank Wall, Tom Brady, Bill Clinton, Fried, Lauren Silva Laughlin, Sharon Lam Organizations: Reuters, Enron, Countrywide Financial, Countrywide, Bank of America, Lawmakers, Sarbanes, Oxley, Frank Wall Street Reform, Consumer, The Securities, Exchange Commission, Pew Research Center, Louis Federal Reserve, Southern, Thomson Locations: Manhattan, New

☆ The fate of this consumer watchdog is in the hands of the Supreme Court
▼ + stars: | 2023-10-03 | by ( Elisabeth Buchwald | ) edition.cnn.com time to read: +6 min

New York CNN —On Tuesday, the Supreme Court began hearing oral arguments in a case that will determine the fate of the Consumer Financial Protection Bureau. The Supreme Court will have the final say on that, however. The consumer watchdog agency was created after the 2008 financial crisis by way of the Dodd-Frank Wall Street Reform and Consumer Protection Act. If the Supreme Court finds the CFPB’s funding structure unconstitutional, it could shutter the agency and invalidate all of its prior rulings. From listening to the case on Tuesday, though, Lynyak believes the Supreme Court will rule that the CFPB’s funding structure is constitutional.

Persons: Dodd, Frank Wall, Democratic Sen, Elizabeth Warren, Ting Shen, Wells, Sam Gilford, ” There’s, Joseph Lynyak III, Lynyak, ”, Noel Francisco, Francisco, “, Sonia Sotomayor, Amy Coney Barrett Organizations: New, New York CNN, Supreme, Consumer Financial, Bureau, Community Financial Services Association of America, Appeals, Fifth Circuit, Frank Wall Street Reform, Consumer, Democratic, Harvard Law School, Federal Reserve, Bloomberg, Getty, “, Mortgage Bankers Association, National Association of Homebuilders, National Association of Realtors, Bank of America, Court, Federal Deposit Insurance Corporation, Congressional, CNN, Dorsey & Whitney, Republican Locations: New York, New Orleans, United States

☆ Social Security, Medicare, and other key programs Americans rely on could become 'vulnerable' depending on an upcoming Supreme Court ruling, a former federal official says
▼ + stars: | 2023-10-02 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +5 min

The Supreme Court is hearing oral arguments in a case challenging the CFPB's funding structure. A former FDIC official said an adverse ruling could risk Social Security and Medicare. Any agency that doesn't rely on annual funding from Congress would be jeopardized, she said. AdvertisementAdvertisementStill, advocates and lawmakers have stressed the importance of preserving the CFPB's funding structure to protect consumers from the potential fallout. A bad decision in the Supreme Court could wreck the financial security of millions of families and turn our economy upside down."

Persons: —, Sheila Bair —, Federal Deposit Insurance Corporation —, Bair, Dodd, Frank Wall, Shahid Naeem, Massachusetts Sen, Elizabeth Warren, Warren Organizations: FDIC, Security, Service, Financial, Community Financial Services Association of America Ltd, Federal Reserve, Fifth Circuit, Federal Deposit Insurance Corporation, Social Security, Frank Wall Street Reform, Consumer Protection, American Economic Liberties Project, Congress Locations: Massachusetts

☆ Student-loan borrowers' biggest defender in the government is in jeopardy
▼ + stars: | 2023-09-09 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +9 min

The ruling could have significant implications for student-loan borrowers — and consumers nationwide. As federal borrowers have been gearing up for the return to loan repayment in October, the agency cracked down on companies that it accused of illegally charging borrowers for normally free debt-relief services. The Supreme Court is hearing oral arguments on the case on October 3. The CFPB's enforcement actions against this type of illegal conduct are important to protecting borrowers' financial security and obtaining their money back." Now consumers will have to wait and see how the Supreme Court views a top federal consumer watchdog's constitutionality.

Persons: Sen, Elizabeth Warren of Massachusetts, Shahid Naeem, Naeem, Dodd, Frank Wall, Bill Clark, Devin Watkins, they're, beholden Organizations: Service, Supreme, Financial, Community Financial Services Association of America Ltd, Consumer Financial, Federal Reserve, Fifth Circuit, Trump, Fifth, Financial Services Association of America, American Economic Liberties, Congress, Frank Wall Street Reform, Consumer, Federal Deposit Insurance Corp, Inc, Getty, Competitive Enterprise Institute, American Association of, Social Security Locations: Wall, Silicon, Washington , DC

In 2017, with Mr. Connors’ help, Mr. Maichle started his own company, Precision Compliance Consulting. ‘Boss Man’Mr. Connors, Mr. Lewis and Mr. Maichle were all active in college conservative politics in Wisconsin about 15 years ago, when Mr. Connors was the leader of campus Republicans at Marquette University. Of that, about $102,000 went to Campaign Now, the firm started by Mr. Connors, and another $112,000 to companies where Mr. Connors, Mr. Maichle or Mr. Lewis was either the owner or a partner, tax records show. Most of the money — more than $4.4 million — went to fund-raising companies via tens of thousands of small payments. Most of the money — more than $4.4 million — went to fund-raising companies via tens of thousands of small payments.

☆ JPMorgan could be the banking sector’s biggest hero — or biggest risk
▼ + stars: | 2023-05-03 | by ( Krystal Hur | ) edition.cnn.com time to read: +7 min

And as the bank swells in size, so does the potential risk it poses to the nation’s financial system. Some experts say they’re concerned that JPMorgan’s continued intervention during times of crisis has broader implications for the banking sector, the US financial system and its regulation. And with every failed bank that JPMorgan snaps up, the conundrum becomes clearer: JPMorgan is essentially the biggest risk to the financial system — and every time it expands to uphold the sector’s stability, so does its risk to the financial system. It has “that ability once again, to signal to the world that JPMorgan is a fortress, JPMorgan is the ultimate. But recent failures and the missteps that led to them indicate that deep flaws underline the financial system.

☆ US Fed points finger at Trump-era rollback for SVB demise
▼ + stars: | 2023-04-29 | by ( Douglas Gillison | ) www.reuters.com time to read: +4 min

According to the Fed, SVB's management bore significant blame and bank examiners also made grave missteps. Randal Quarles, who was appointed to the Fed by President Donald Trump in 2017, oversaw the Fed's bank supervision until his resignation in 2021. Patrick McHenry, the Republican chair of the House of Representatives Financial Services Committee, blasted the Fed report as a "thinly veiled attempt" to justify positions like those of Warren. According to the report, the 2018 law caused the Fed to raise the supervisory threshold for large banks, i.e. those smaller than the "global systemically important banks," to $100 billion in assets from $50 billion -- delaying stricter oversight of SVB "by at least three years."

☆ CFPB says employee sent confidential data of 256,000 consumers to personal email
▼ + stars: | 2023-04-20 | by ( Krystal Hur | ) edition.cnn.com time to read: +2 min

New York CNN —An employee at the Consumer Financial Protection Bureau sent confidential data about hundreds of thousands of consumer accounts to their personal email, the agency told CNN on Thursday. The employee also sent two spreadsheets that listed names and transaction-specific account numbers related to about 256,000 consumer accounts at one institution. “The numbers are used internally by the institution, are not the consumers’ bank account numbers, and cannot be used to gain access to a consumer’s account,” the CFPB said. “This unauthorized transfer of personal and confidential data is completely unacceptable. All CFPB employees are trained in their obligations under Bureau regulations and Federal law to safeguard confidential or personal information,” the agency said in a statement to CNN.

March 28 (Reuters) - The recent failures of mid-size U.S. lenders show the need for more robust risk management at banks and fintechs, along with improved regulation, the head of the top consumer financial watchdog agency said on Tuesday. Consumer Financial Protection Bureau Director Rohit Chopra told a gathering of retail bankers in Las Vegas that regulators were looking at liquidity, interest-rate risk management, capital frameworks, resolution planning and stress testing. "It will be good for the industry to have some honest conversations with itself about what is the way for the regulatory framework to not create this type of risk," Chopra said. As head of the CFPB, Chopra also sits on the board of the Federal Deposit Insurance Corporation, which took over failed Silicon Valley Bank earlier this month. He also serves on the Financial Stability Oversight Council, created in the wake of the 2008 crash.

☆ Market nerves tie US rate-setters’ hands
▼ + stars: | 2023-03-22 | by ( Ben Winck | ) www.reuters.com time to read: +3 min

On Wednesday the central bank raised interest rates a quarter point. The failure of Silicon Valley Bank nearly two weeks ago upended the U.S. financial system, and the Fed and other agencies have had to provide a steadying hand. But by Wednesday morning, just before the central bank’s decision, the futures market was mostly pricing in a 25 basis point hike. Futures contracts tracking the central bank’s benchmark rate have also been shaky. Wall Street reforms passed in 2010 crystallized the central bank's duty to foster a stable financial system.

☆ What would a federal expansion of deposit insurance look like?
▼ + stars: | 2023-03-22 | by ( Ramishah Maruf | ) edition.cnn.com time to read: +7 min

That’s the Federal Deposit Insurance Corporation’s standard limit, meaning any bank deposits up to that amount are protected by the independent government agency. But now there’s growing support for raising that insurance cap. A higher insurance cap doesn’t automatically mean banks will be subject to tighter regulations, Dollar noted, but there could be some call for it. The FDIC insurance limit has been raised seven times since 1950 — and $250,000 also isn’t a calculated number, Collins said. In 2008, the FDIC used the same system for temporary unlimited deposit insurance guarantee on certain accounts.

☆ Silicon Valley Bank's collapse is looming over the Fed as it makes the next move in its war on inflation this week
▼ + stars: | 2023-03-21 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +5 min

Democrats have been targeting Fed Chair Powell over his role in the bank's shutdown. The first is to remind Chair Powell: he has a dual mandate. Her second point, she said, was that raising interest rates does not solve issues like price gouging or the Ukraine invasion. During a Senate hearing earlier this month, Powell responded to Warren's questioning on interest rates costing jobs. "Will working people be better off if we just walk away from our jobs and inflation remains 5%-6%?"

☆ U.S. poised to tighten reporting rules on $20 tln private fund sector
▼ + stars: | 2023-03-17 | by ( Douglas Gillison | ) www.reuters.com time to read: +3 min

March 17 (Reuters) - Wall Street's top regulator is set to adopt new rules aimed at bolstering oversight of systemic risk in the burgeoning, multitrillion-dollar world of private equity and hedge-funds. As proposed in January 2022, the rule would require reporting of such events to the SEC within one business day. The agency billed the new rule in part as a means of supporting the Financial Stability Oversight Council, a multi-agency risk-monitoring body also created under Dodd-Frank. The proposal offered "scant evidence" that it would enhance FSOC's monitoring for systemic risk, she said in dissenting remarks against the proposal, adding that it would likely become a tool "for government to micromanage private fund risk management." Reporting by Douglas Gillison; Editing by David GregorioOur Standards: The Thomson Reuters Trust Principles.

☆ 'Shark Tank' star Kevin O'Leary is blaming Silicon Valley Bank's implosion on a 'negligent board of directors' with 'idiot management'
▼ + stars: | 2023-03-14 | by ( Cheryl Teh | ) www.businessinsider.com time to read: +3 min

Kevin O'Leary has blamed Silicon Valley Bank's management for the bank's implosion. Silicon Valley Bank collapsed after a bank run, and there are differing opinions on why that happened. The Federal Deposit Insurance Corporation took control of Silicon Valley Bank on Friday after a catastrophic bank run. There has been mud-slinging in all directions over the factors that may have contributed to Silicon Valley Bank's failure. Representatives for Silicon Valley Bank did not immediately respond to Insider's request for comment outside regular business hours.

☆ Bernie Sanders says Silicon Valley Bank's failure is the 'direct result' of a Trump-era bank regulation policy
▼ + stars: | 2023-03-13 | by ( Cheryl Teh | ) www.businessinsider.com time to read: +4 min

Sen. Bernie Sanders is blaming a Trump-era policy for the Silicon Valley Bank run. "Now is not the time for US taxpayers to bail out Silicon Valley Bank. The Federal Deposit Insurance Corporation shut down the Silicon Valley Bank on Friday following a catastrophic bank run. The collapse of Silicon Valley Bank has now become the largest bank failure in the US since the 2008 financial crisis. However, startups with money in Silicon Valley Bank exceeding $250,000 are now in danger of not being able to make payroll next week.

☆ House Republicans target the CFPB as the agency takes aim at 'junk fees'
▼ + stars: | 2023-03-09 | by ( Chelsey Cox | ) www.cnbc.com time to read: +7 min

WASHINGTON — Lawmakers discussed ways to reform, or altogether defund, the nation's foremost consumer protection agency on Thursday, as the regulator takes aim at illegal "junk fees" levied on consumers. GOP lawmakers in the hearing criticized the Biden administration's push to eradicate "junk fees," largely regulated by the CFPB. On Wednesday, the agency released a list of illegal junk fees encompassing deposit accounts; auto and mortgage loan servicing; and payday and title lending. Subcommittee member Rep. Blaine Luetkemeyer, R-Mo., said Chopra has used junk fees as an excuse to expand his authority. The CFPB's working definition of junk fees is "any fee they don't like," argued Devin Watkins, an attorney at the conservative-leaning Competitive Enterprise Institute.

☆ CFPB: What it does and why its future is in question
▼ + stars: | 2023-03-03 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +6 min

The CFPB’s missionThe agency was created after the 2008 financial meltdown, as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The broad purpose of the CFPB is to protect consumers from financial abuses and to serve as the central agency for consumer financial protection authorities. It is charged with implementing and enforcing consumer protection laws, making rules and issuing guidance for consumer financial institutions. And it is the place consumers can go to lodge complaints about financial products and services. “It has completely changed the consumer financial marketplace.

The justices will hear the case during the court's next term, which begins in October. The case is the latest to come before the Supreme Court seeking to rein in the authority of federal agencies. The CFPB, which enforces consumer financial laws, was created after the 2008 financial crisis as part of a federal law known as the Dodd–Frank Wall Street Reform and Consumer Protection Act. A Democratic-led Congress in 2010 set up the agency to draw funding annually from the Federal Reserve, the U.S. central bank, which last fiscal year transferred around $642 million to the consumer protection agency. The court heard arguments in November in two other cases involving agency power.

☆ U.S. targets '08 crisis trader conflicts in new rule, decade after 1st try
▼ + stars: | 2023-01-25 | by ( Douglas Gillison | ) www.reuters.com time to read: +4 min

The rule is among the last to be adopted under the landmark Dodd Frank Wall Street reform legislation of 2010, according to SEC officials. An earlier version of the conflicts rule first proposed in 2011 was never finalized. SEC officials say it would provide exceptions for legitimate activities, such as hedging to mitigate risk, market-making and meeting liquidity commitments. Better Markets, an advocacy organization that promotes more strict financial sector regulation, welcomed Wednesday's rule proposal but vowed to study it. Without citing prominent recent examples of such conflicts of interest in the asset-backed securities market, SEC officials said the conflicts rule was needed to remove the opportunity and incentive for such conduct.

☆ SEC readies Wall Street 'conflicts' rule, a decade after first try
▼ + stars: | 2023-01-25 | by ( Douglas Gillison | ) www.reuters.com time to read: +3 min

An earlier version of the conflicts rule first proposed in 2011 was never finalized. When made effective with an SEC rule, the section would prohibit traders from betting against asset-backed securities they sold to investors. According to SEC officials, the rule would ban such actions for up to a year following sale of the securities. According to SEC officials, traders who disclosed bets contrary to clients' investments would still run foul of the rule. Without citing prominent recent examples of such conflicts of interest in the asset-backed securities market, SEC officials said the conflicts rule was needed to remove the opportunity and incentive for such conduct.

☆ Don't expect a wave of short sales and foreclosures during this housing downturn — homeowners have too much equity
▼ + stars: | 2022-12-14 | by ( Alcynna Lloyd | ) www.businessinsider.com time to read: +6 min

Today's market has tighter lending standards, more assistance programs, and historic levels of homeowner equity compared to downturns of the past. "Historically, normal foreclosure activity means about a single percent of loans are in foreclosure," he told Insider. These initiatives paired with high levels of home equity — roughly $29 trillion as of the second-quarter of the year, according to the Federal Reserve — are likely to prevent an upcoming wave of short sales and foreclosures, Sharga suggests. The spike in foreclosure activity between 2021 and 2022 stems from the expiration of temporary financial safety nets enacted through the CARES Act. But even with this prospect, Sharga suggests that a substantial uptick in foreclosures or short sales is unlikely as many recent homebuyers have positive equity in their homes.

The SEC's whistleblower program was created as part of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, a law passed in response to the 2008 financial crisis. Under the law, eligible whistleblowers can receive a cash award of between 10% and 30% of any monetary sanctions collected above $1 million. Hong provided further documentary evidence, helping FHFA and the U.S. Justice Department secure settlements with RBS for $5.5 billion and $4.9 billion, respectively. Hong sought an award under the SEC's whistleblower program but the commission declared him ineligible because the action against RBS was not taken by the commission itself. Hong's lawyers appealed to the Supreme Court, contending that the SEC is undermining the aim of Congress to incentivize and award whistleblowers by "coordinating enforcement efforts with other agencies and then refusing to pay an award."

Royal Bank of Scotland signs are seen at a branch of the bank, in London, Britain December 1, 2017. RBS agreed to settle Justice Department and FHFA investigations over its sales of residential mortgage-backed securities in the run-up to the financial crisis. The SEC did not pursue its own action against RBS in this instance. The petition Hong filed on Monday asks the Supreme Court to consider what constitutes an "action" within the SEC's whistleblower incentive program. "The better a whistleblower's information, the larger the sanctions, the larger the whistleblower award, and the greater the self-interested motivation for the SEC to take enforcement actions that it has conveniently placed outside of Dodd-Frank's reach," it added.

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