Committee: Dodd-Frank compliance to cost private sector 24 million man-hours per year
The House Financial Services Committee plans to release a new Web resource aimed at tracking the regulatory burden of the Dodd-Frank financial overhaul Congress passed in 2010. The “Dodd-Frank Burden Tracker” is set to measure how much of a negative effect the legislation will have.
According to a release The Daily Caller obtained that will be sent out with the announcement of the new Web service, the legislation — and the rules government regulators have written to go with it — has already had a profound effect on the financial sector.
Regulators have written only 185 of the expected 400 rules. But those 185 rules are expected to cost the private sector more than 24 million man-hours each year to comply.
The tracker has also found that those 185 rules take up more than 5,300 pages.
Texas Republican Rep. Randy Neugebauer, the chairman of the committee’s subcommittee on oversight and investigations, told The Daily Caller that means that instead of hiring people to handle small business loans, banks will be hiring staff to comply with the new government regulations, ultimately having a negative impact on job creation.
“For example, let’s just get it down to the community banker — the person that loans money to most of the small businesses in our country,” Neugebauer said in a phone interview. “We’ve had a few community bankers come in here and say, ‘you know, they’re hiring a lot more compliance officer than they are loan officers.’ That is increasing the cost of banking and, ultimately, they have to charge higher interest rates and higher fees.”
“The other thing that it impacts for our small businesses is because of some of the new rules and regulations, there’s a great deal of uncertainty about certain types of financial activity that some of these entities can engage in,” Neugebauer added. “I think that as these rules come out, what we’re trying to ascertain, and our committee has had a number of hearings on, is what the unintended consequences of some of these rules and regulations, but more importantly, just the sheer volume of them.”
Neugebauer said that as time goes on and new rules are written, the Financial Services Committee staff will continue updating the “Dodd-Frank Burden Tracker.”
“I think the question will be: What will be the final number?” Neugebauer said. “How many millions of man hours will be required [to comply with Dodd-Frank] when all 400 rules are completed?”