CHN: House GOP Passes Bill to Gut Financial Regulations and Consumer Protections
On June 8, the House passed a bill that would largely gut the Dodd-Frank financial regulations, the banking legislation passed in 2010 in the aftermath of the financial crisis. The Financial CHOICE Act would strip away regulations on banks and Wall Street that were put in place to protect consumers, investors, and the economy from risky lending and investment practices that could bring on another recession. For example, the bill would repeal the Labor Department’s fiduciary rule, which requires that brokers put clients’ interest ahead of their own when giving retirement advice.
In addition, the bill would take away independent funding from the Consumer Financial Protection Bureau, which was created under Dodd-Frank, and subject it to the annual appropriations process, meaning Congress could slash or even defund the consumer watchdog agency. The bill would also allow the president to fire the CFPB’s director at will. Since it began operations in 2011, the CFPB has returned nearly $12 billion in refunds and relief to some 17 million Americans cheated by financial companies. Yana Miles, senior legislative counsel for the Center for Responsible Lending, said, “The bill even specifically exempts payday and car title lenders — notorious for springing devastating debt traps for their already vulnerable customers — from any regulation.” The bill passed the House (233-186) with only Republican support; all Democrats and Republican Rep. Walter Jones (NC) voted no. It is not expected to be taken up in the Senate, where it would need 60 votes to pass but does not have any Democratic support.