Wednesday, July 21, 2010

President Signs Legislation Overhauling US Financial Regulation

President Obama today signed the Dodd-Frank Wall Street Reform and Consumer Protection Act, calling it the strongest consumer financial protection legislation in history. Transparency is a hallmark of the Act, he said, with ordinary investors, like seniors, being able to receive more information about the costs and risks of mutual funds and other investment products, so that they can better make financial decisions that work for them. The Act will also bring transparency to the kinds of complex, risky transactions that helped trigger the financial crisis. And shareholders will also have a greater say on the pay of CEOs and other executives, so that they can reward success instead of failure.

We all win when shareholders have more power and information, emphasized the President, and we all win when folks are rewarded based on how well they perform, not how well they evade accountability.

The Act also ensures that the American people will never again be asked to foot the bill for Wall Street’s mistakes. There will be no more taxpayer-funded bailouts. If a large financial institution should ever fail, Dodd-Frank provides for a winding down without endangering the broader economy. And there will be new rules to make clear that no firm is somehow protected because it is “too big to fail.”

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