President Donald Trump’s administration is expected to roll out a plan to curb the powers of the Consumer Financial Protections Burea (CFPB) and lay out its review of a large swath of banking regulations in a report expected to be released as early as Monday.
Trump ordered Treasury Secretary Steve Mnuchin and the Treasury Department in early February to conduct a thorough review of regulations imposed on the banking and financial sectors after the housing market collapse of 2007. The Treasury’s report is expected to be less far-reaching than the Financial CHOICE Act passed in the House June 8. (RELATED: Trump Signs Executive Order To Dismantle Dodd-Frank)
The CFPB is the brainchild of Sen. Elizabeth Warren of Massachusetts, who believes the bureau is vital to constrain Wall Street and protect ordinary American consumers.
The report, expected to be around 150 pages, will be highly critical of the CFPB and will recommend that the entity be stripped of its authority to review financial institutions, The Wall Street Journal reports. Currently, the bureau has the authority to both enforce consumer laws and review individual firms on a rolling basis.
Wall Street firms have focused on Trump’s promise to overhaul Dodd-Frank since he signed the executive order in February. Specifically, major banks want him to do away with the Volcker rule, which limits how Wall Street firms trade and invest their own money.
The Treasury’s report is expected to include a section on the Volcker rule. The section will reportedly advise that small banks with under $10 billion in assets be exempt from the rule entirely. The report is not expected to advise repealing the rule.
The Treasury will also reportedly advise that banks submit a “living wills” status update every two years, instead of annually. Living wills statements outline how banks could go through bankruptcy without the need for a taxpayer-funded bailout.
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