WASHINGTON, D.C. - Congressman Jason Lewis (MN-02) issued the following statement as the House expects to consider H.R. 10, the Financial Creating Hope and Opportunity for Investors, Consumers, and Entrepreneurs (Financial CHOICE) Act, this week:
“I came to Washington to ensure that federal policies help people at home by encouraging economic growth and job creation. The Financial CHOICE Act relieves the one-size-fits-all big-government regulations from unaccountable groups like the CFPB which have hurt community banks and credit unions. Since Dodd Frank was enacted, 1,900 community banks and credit unions have closed.
“These small institutions are foundational to the success of communities in Minnesota’s 2nd District, and the CHOICE Act’s much-needed relief will help them do what they do best; provide access to capital and credit for small businesses, new start-ups, and families in our neighborhoods.
“I also want to protect folks at home from being put on the hook for Wall Street’s bad behavior. Taxpayers already work hard; and their tax dollars have no business propping up massive financial institutions that are ‘too big’ – or too well-connected – to fail. The Financial CHOICE Act removes the taxpayer backstop for Wall Street established by the Dodd-Frank Act.”
Background: H.R. 10, the Financial CHOICE Act, reforms many of the provisions put in place by the Dodd-Frank Act of 2010. The Dodd-Frank Act was an attempt to address the financial crisis of 2008; however many of the provisions have failed to address the issue of risk in the financial system and instead put new layers of regulation on small banks and credit unions which impost compliance costs, decreasing jobs and passing on new expenses to the consumer. The Financial CHOICE Act contains provisions, including the following, to end taxpayer bailouts and widen economic opportunity.
- Ends Too Big To Fail and protects taxpayers from bailing out big banks: repeals 'orderly liquidation authority' and makes a new chapter of the bankruptcy code for large, complex financial institutions.
- Stops the Financial Stability Oversight Council from designating firms as 'Systemically Important Financial Institutions'
- Lets the SEC triple the fines for fraud or self-dealing, to ensure we are tough on Wall Street crime.
- Makes all financial regulatory agencies subject to the REINS Act, and puts them under appropriations so Congress has oversight (exception for Federal Reserve monetary policy).
- Requires cost-benefit analysis in financial regulatory rulemaking.
- Restores Due-Process for Americans by allowing a ‘right of removal’ from proceedings under Administrative Law Judges (employed by the agency) to federal court.
- Allows financial institutions to ‘opt out’ of Basel III and Dodd-Frank’s regulations if they choose to hold capital at a strongly capitalized 10% leverage ratio level, so that they have reserves to deal with a crisis.
- Includes nearly 24 capital formation bills to help start-ups and encourage IPOs, including crowdfunding and angel investing.
- Exempts institutions under $50 billion from the oversight of the CFPB, helping local banks and credit unions suffering under increased compliance costs
- Makes the Director of the CFPB removable at the will of POTUS, and brings the agency under appropriations. Removes the CFPB’s law-making power to focus on law-enforcement
- Repeals the DOL Fiduciary rule.
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