Financial Regulatory Reform

The U.S.

Massachusetts Republican Senator Scott Brown, together with Republican Senators Susan Collins and Olympia J. Snowe from Maine, joined 57 Democratic Senators - including Pennsylvania Senator Arlen Specter, who lost the Democratic nomination on Tuesday - to stop debate and allow the whole Senate to vote on the financial regulatory reform bill. Two Democratic Senators, Maria Cantwell of Washington and Russ Feingold of Wisconsin, voted no.

Earlier this morning, we noted that a story in the New York Times today says that the Financial Crisis Inquiry Commission that Congress created to look into the financial meltdown is wrestling with “setbacks.” Now, we see that the Washington Post says that the SEC is facing “setbacks” (along with skepticism) in its efforts to change its enforcement image. 

Walter Moeling, a banking law expert and head of the Financial Institutions practice at the international law firm Bryan Cave LLP, has some thoughts that we think are of great interest on the Senate Banking Bill being considered today:  

Good Friday morning, all. There are a lot of lawyers (and bloggers, such as yours truly!) following the federal government’s response to the economic and financial industry problems we have been facing for a year.

The group known as "Americans for Financial Reform" is right out of the gate with a statement on the passage by the House Financial Services Committee earlier today of a bill providing for a Consumer Financial Protection Agency. Opponents undoubtedly will be criticizing the bill, but here’s what AFR’s director, Heather Booth, says: 

It may very well happen. “It” is financial regulatory reform, and today the House Financial Services Committee passed H.R. 3126, the Consumer Financial Protection Agency Act of 2009. As the Wall Street Journal reports, the vote was largely along party lines – but the party that voted in favor has majorities in both the House and Senate.

“Dark pools” of liquidity are a type of private, alternative trading system (“ATS”) in which participants can transact their trades without displaying quotations to the public. When investors place an order to buy or sell on an exchange, the exchange typically makes that order available for the public to view. With some dark pools, however, investors are able to signal that they have an interest in either buying or selling a security.

Here’s one other piece you might want to read this morning: Politico.com has a great story on a vote yesterday in the House Financial Services Committee that exempts credit unions and all but the largest community banks from being subjected to the requirements and oversight of the expected consumer financial protection agency.