BigNews.Biz - May 01,2012 - Senators: Implement Volcker rule without delay
22 U.S. Senators urge regulators to write a clear, strong, effective firewall
Washington, DC - Senators Daniel K. Akaka and Daniel K. Inouye joined a group of 22 Senators this week calling on regulators to write and implement a strong Volcker Rule free of loopholes and draw clear lines between large hedge-fund like trading and traditional banking. In a letter to Federal Reserve Chairman Ben Bernanke and other regulators, the Senators reminded the agency heads of the major role conflict-ridden, high-risk trading had in the makings of the financial crisis, and the need for the Volcker Rule firewall.
"The American people suffered greatly because of the financial crisis," the Senators wrote. "The Volcker Rule is a critical protection to help ensure that such a crisis does not happen again. The economy needs these protections, our constituents deserve these protections, and the law demands these protections. Please implement a clear, strong, and effective Volcker Rule without delay."
The Volcker Rule was established by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which became law on July 21, 2010. Senators Akaka and Inouye both supported the Wall Street Reform Act, which was developed in response to the 2008 economic downturn.
"The financial crisis was a stark reminder of the importance of a healthy banking system where households and businesses are able to access credit to continue to drive our economy," said Senator Akaka. "The Volcker Rule keeps banks out of the business of high-risk trading that threatens economic stability and puts families on the hook."
The letter lists out specific issues with the proposed Volcker Rule from October, but asks that it not be delayed or scrapped. Rather, it urges the regulators to:
•adopt the best elements from the proposed rule;
•draw clear lines based on objective data and observable markets;
•strengthen CEO and board-level accountability and public disclosure; and
•provide coordinated and consistent enforcement, including data sharing by regulators.
Senators Jeff Merkley (D-Oregon) and Carl Levin (D-Michigan) authored the letter which was signed by Senators Akaka, Inouye, Barbara Mikulski (D-Maryland), Mark Begich (D-Alaska), Tom Harkin (D-Iowa), Al Franken (D-Minnesota), Dianne Feinstein (D-California), Richard Durbin (D-Illinois), Jeanne Shaheen (D-New Hampshire), Frank Lautenberg (D-New Jersey), Jack Reed (D-Rhode Island), Sheldon Whitehouse (D-Rhode Island), Barbara Boxer (D-California), Bernie Sanders (I-Vermont), Claire McCaskill (D-Missouri), Patrick Leahy (D-Vermont), Richard Blumenthal (D-Connecticut), Sherrod Brown (D-Ohio), Ron Wyden (D-Oregon), and Jay Rockefeller (D-West Virginia).