Today, Congresswoman Maxine Waters (D-CA), Chairwoman of the House Financial Services Committee, issued the following statement on yet another attempt by prudential regulators to weaken the Volcker Rule.
“Just weeks after the passing of Paul Volcker, prudential regulators are once again working overtime to weaken a regulation that he fought tirelessly for by allowing banks to gamble with taxpayer money.
“The Volcker Rule is a cornerstone of Wall Street reform that Congress passed in the wake of the 2008 financial crisis to prevent federally-insured, deposit-taking banks from engaging in risky, speculative activities, on the backs of the American taxpayers.
“In August, regulators senselessly weakened the proprietary trading section of this critical rule. Today, they are proposing to allow banks to invest in the same risky assets that contributed heavily to the financial crisis and to become more entangled in private equity and hedge funds.
“At a time when prudential regulators should be working to uphold consumer protections, we continue to see a series of deregulatory actions by Trump appointees that benefit Wall Street at the expense of Main Street.
“I call on the Federal Reserve, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, the Commodity Futures Trading Commission and the Securities and Exchange Commission to work on behalf of the American people and reconsider this and every other senseless attack on the Volcker Rule.”
Chairwoman Waters continues her efforts to fight against the deregulatory agenda of the Trump Administration and Congressional Republicans.
In August 2019, she blasted the decision by the Federal Deposit Insurance Corporation (FDIC) and approval of the Office of the Comptroller of the Currency (OCC) to weaken another key component of the Volcker Rule.
Since 2017, the Trump Administration has made financial deregulation a top priority, with the President vowing in his first few days in office to do a "big number" on the Dodd-Frank Wall Street Reform and Consumer Protection Act's safeguards that Congress put in place following the global financial crisis a decade ago. Trump's Treasury Department subsequently laid out the Administration's deregulatory blueprint through a series of reports containing numerous recommendations for regulators to deregulate Wall Street megabanks, payday lenders and other bad actors.
Trump's appointees have been busy implementing his plan to undermine the work of the Consumer Financial Protection Bureau in a myriad of ways, rolling back key financial stability oversight, and despite Wall Street megabanks making record profits, regulators have been methodically weakening their capital, liquidity, stress testing, and living will requirements that have helped keep the financial system safe since the last financial crisis.
The Treasury reports also call for a significant weakening of the Volcker Rule, which prudential regulators are working to help fulfill.