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U.S. Deputy Treasury Secretary Neal Wolin said lawmakers and lobbyists opposed to the Dodd-Frank Act will fail in efforts to roll back parts of the regulatory overhaul enacted in response to the 2008 credit crisis.
“The whole thing will be implemented before we are done,” Wolin, who was appointed by President Barack Obama in 2009, said today in a panel discussion at the Bloomberg Link Washington Summit. “There are efforts in Congress to roll back and the like and I don’t think they are likely to succeed.”
U.S. regulators including the Federal Reserve and Securities and Exchange Commission are nearly two years into implementing Dodd-Frank, which was signed into law by Obama in 2010. Regulators still have dozens of measures to complete, including the Volcker rule that will ban proprietary trading at banks such as Goldman Sachs Group Inc. (GS) and JPMorgan Chase & Co. (JPM)
Wolin and other Obama administration officials are defending Dodd-Frank against attacks by congressional Republicans, who stepped up efforts to overturn portions of the law after their party took control of the House last year. The House Financial Services Committee last month voted to repeal the law’s resolution authority, which gives the Federal Deposit Insurance Corp. power to liquidate systemically important companies whose collapse could imperil the broader economy.
Representative Scott Garrett, a New Jersey Republican who serves on the House panel, said changes are needed because Dodd- Frank reaches too far into the markets, with regulators creating uncertainty and barriers as they craft rules.
“The pendulum has gone way too far, and this is typical of Washington in these times,” Garrett, who leads the Financial Services capital markets subcommittee, said today.
Former SEC Chairman Arthur Levitt, a senior adviser to Goldman Sachs, said that while changes to the regulatory structure put the U.S. in a better position, the financial system is “by no means out of the woods.”
“If I had to put a number on how much of Dodd-Frank will see the light of day, I’d say it will be south of 50 percent,” said Levitt, who is a member of the board of Bloomberg LP, the parent company of Bloomberg News. Levitt faulted Republican lawmakers over their efforts to cut funding to regulators and make changes to the law.
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