WALL STREET REFORM & CONSUMER PROTECTION ACT

For eight years, President Bush and Congressional Republicans looked the other way as Wall Street and the Big Banks exploited loopholes, gambled your money away on complex schemes, and rewarded failure and recklessness. America's families and small businesses paid the price. We lost 8 million jobs and $17 trillion.

This Congress and President Obama have made tough choices and taken effective steps to bring our economy back from the brink of disaster. The Recovery Act has already saved or created up to 2.8 million jobs, and much of the TARP has been paid back. Now we are taking another key step forward with a final agreement on the Dodd-Frank Wall Street Reform and Consumer Protection Act (H.R. 4173).

As we rebuild our economy, we must put in place common-sense rules to ensure Big Banks and Wall Street can't gamble with our futures again. Wall Street may be bouncing back, but we know from experience they're not going to police themselves.

Common-sense reforms that hold Wall Street and the Big Banks accountable will:

• End bailouts and ensure that taxpayers are never again on the hook for Wall Street's risky decisions
• Protect Americans' retirement funds, college savings, homes, and businesses' financial futures from unnecessary risk by CEOs, lenders, and speculators
• Protect consumers from predatory lending abuses, fine print, and industry gimmicks
• Inject transparency and accountability into a financial system run amok

WHAT WILL THE WALL STREET REFORM & CONSUMER PROTECTION ACT DO?

• Create a new Consumer Financial Protection Agency to protect families and small businesses by ensuring that bank loans, mortgages, and credit cards are fair, affordable, understandable, and transparent. We currently have rules that keep companies from selling us toasters that burn down our homes. We should have similar rules that bar the financial industry from offering mortgage loans to people who can't afford repayment.
• End abusive predatory lending practices that occurred during the subprime lending frenzy.
• Shut down "too big to fail" financial firms before risky and irresponsible behavior threatens to bring down the entire economy.
• End costly taxpayer bailouts with new procedures to unwind failing companies that pose the greatest risk – paid for by the financial industry and not the taxpayers. Also eliminates the TARP as of July 1.
• Impose tough new rules on the riskiest financial practices that gambled with your money and caused the financial crash, like the credit default swaps that devastated AIG, and common sense regulation of derivatives and other complex financial products. The bill includes a strong "Volcker rule" that generally restricts large financial firms with commercial banking operations from trading in speculative investments.
• Strengthen enforcement and oversight of the financial industry with:
  • More enforcement power and funding for the Securities and Exchange Commission, including requiring registration of hedge funds and private equity funds
  • Enhanced oversight and transparency for credit rating agencies, whose seal of approval enabled the excessively risky practices that led to the financial collapse
• Rein in egregious executive compensation and retirement plans by allowing a 'say on pay' for shareholders, requiring independent directors on compensation committees, and limiting bank executive risky pay practices that jeopardize banks' safety and soundness.
• Establish new protections for grocers, retailers and other small businesses facing out-of-control swipe fees that banks and other credit and debit card issuers charge these businesses for debit or prepaid-card purchases. As a result, merchants stand to save billions.
• Audit the Federal Reserve's emergency lending programs from the financial crisis and limits the Fed's emergency lending authority.