In a recent op-ed published in American Banker, Ford School Dean Michael S. Barr says the U.S. Senate’s new relief bill is a giveaway for large banks and weakens consumer protections.
The bill is the first re-write of the 2010 Dodd-Frank Act, of which Barr was a key architect. The bill was authored by Senate Banking Committee Chairman Mike Crapo, whom Barr credited for efforts of bipartisan support on the bill, calling them “admirable.”
However, Barr says passing the bill would be a “significant mistake” due to its weakening oversight of all firms, undermining a key capital ratio, and handing large banks a litigation tool against stricter standards.
“It’s bad enough that the administration is rolling back enforcement at the Consumer Financial Protection Bureau. Congress does not need to join in the parade,” Barr wrote.
Barr argues that the legislation would eliminate annual Fed stress testing, which only applies to the largest firms in the country with assets of $50 billion and above. And he says the bill would weaken consumer protections, making it more difficult to detect discrimination in mortgage lending and others protections for America’s most vulnerable families.
The op-ed can be read in full online at American Banker.
--Olivia Lewis, MPP ‘18