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Thursday, July 17, 2014

At Four Years, Analysts Assess Dodd-Frank Act

With the Dodd-Frank Act reaching its fourth anniversary on Monday, think tanks have been releasing their assessments and recommendations. The Bipartisan Policy Center offered 10 recommended tweaks each for regulators and Congress. Among others, it urged regulators to test consolidated exam teams to improve the exam experience, implement the Volcker Rule based on real-world conditions, provide more stakeholder input in the Consumer Financial Protection Bureau’s rulemaking process and beef up the CFPB’s data security practices.

The BPC also suggested that Congress raise the asset threshold for systemically significant firms from $50 billion to $250 billion, fix the swaps pushout rule, create an independent CFPB inspector general, merge the Securities and Exchange Commission with the Commodity Futures Trading Commission and create a federal insurance charter.

Meanwhile, researchers at the American Action Forum examined the effects of Dodd-Frank. They found that it has resulted in 398 new regulations imposing $21.8 billion in costs and 60.7 million hours of paperwork. They also noted tighter mortgage and consumer credit conditions than usually occur in the years after a recession. “With about one-quarter of the law still left to implement, one can only expect the costs to continue to rise,” the researchers said.

Read the BPC recommendations. 

Read the AAF report.