Frank: Obama to lead financial agencies rejig
WASHINGTON (Reuters) - The Obama administration will take the lead on restructuring U.S. financial regulatory agencies, saving Congress from a damaging jurisdictional squabble, said Representative Barney Frank on Tuesday.
The chairman of the House of Representatives Financial Services Committee told the Reuters Global Financial Regulation Summit: "I told this to the president and to his people, they need to step in and talk about how to deal with that."
"The administration is, after all, making a proposal here. I've told them I believe this is one in particular where ... they're in the best position to deal with it," he said.
Frank and other lawmakers have tried in recent months without success to overcome traditional congressional areas of authority to move ahead on reorganizing agencies.
Government bureaucracies viewed last year as vulnerable to possible consolidation included the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), the Office of Thrift Supervision (OTS) and the Office of the Comptroller of the Currency (OCC).
Frank said the administration has indicated it will bring forward a proposal on regulatory restructuring "when they're ready... when it's right to do it in a sensible way.
"I will reiterate one deadline. I think it's very important that all this be signed into law by the president before we adjourn for the year."
The United States has a patchwork financial oversight system stitched together over the past 75 years, with numerous agencies responsible for regulating banks and markets.
"If you were starting from scratch, you wouldn't have an OCC and an OTS, and you wouldn't have an SEC and a CFTC. But as a reality, there was never any prospect of merging either set of pairs," Frank said.
Overhauling the alphabet soup of federal agencies is only a part of a massive set of reforms being considered. Frank said he expects "one big bill sometime this fall" in the Senate.
Other tasks include setting up a "systemic risk" regulator of some sort and empowering the government to seize and unwind large non-bank financial institutions that are in trouble.
"There will be regulatory reorganization," Frank said. "Part of the package is buffing up the prudential regulators, as well, the existing ones, specifically improving the consumer and investor protection piece... So it's the systemic risk, but it's also improving the safety and soundness and investor protection pieces."
(For summit blog: blogs.reuters.com/summits/)
