A bill to dismantle the massive regulatory overhaul instituted in the wake of the 2008 economic crisis passed out of the Financial Services Committee on Thursday.
The Financial Choice Act, sponsored by Rep. Jeb Hensarling, R-Texas, targets the Dodd-Frank Wall Street Reform and Consumer Protection Act and advanced after protracted debate with a party line 34 – 26 vote.
The Financial Choice Act, which stands for “Creating Hope and Opportunity for Investors, Consumers, and Entrepreneurs,” was delayed by a “coordinated group of the committee’s Democratic lawmakers” earlier in the week, but Republicans finally got the vote on Thursday, according to U.S. News and World Report.
“When Democrats passed Dodd-Frank, they claimed it would ‘lift the economy,’” Republicans committee members said as the reason for the legislation. “Instead Americans got the slowest, weakest recovery in 70 years. They promised it would end taxpayer-funded bailouts. Instead it enshrined bailouts into law. They promised it would make our system safer, but today the big banks are even bigger and America is losing one community bank or credit union a day.”
Supporters of efforts to repeal Dodd-Frank released statement praising the committee’s actions.
“We applaud committee passage of the Financial CHOICE Act, and support Chairman Hensarling’s goal of enhancing investment and economic growth by eliminating inappropriate and overly burdensome regulation impacting our capital markets,” Investment Company Institute (ICI) President and CEO Paul Schott Stevens said in a statement. “This timely bill would address flawed aspects of the Dodd-Frank Act that are not fulfilling Congress’s original intent and ultimately threaten, rather than protect, investors, the financial sector, and the economy.”
The Center for Responsible Lending was not as happy.
“Today, the House Financial Services Committee passed along straight party lines the ‘Wrong CHOICE Act,’ an extreme bill that would shred essential consumer protections enacted in the wake of the financial crisis through the Dodd-Frank Wall Street Reform and Consumer Protection Act,” the consumer advocacy organization said. “The Wrong CHOICE Act would severely obstruct the work of the Consumer Financial Protection Bureau, which has returned nearly $12 billion to 29 million Americans harmed by illegal and predatory actions of financial companies.”
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.