June 2014 - Americans for Financial Reform

AFR Statement on Final SEC Cross-Border Rule

“Overall, this rule is disappointing. It continues to leave a major gap in regulatory authority regarding the application of U.S. law to foreign subsidiaries of U.S. banks. Specifically, while the rule applies U.S. jurisdiction to cases where a foreign subsidiary’s swap counterparty has legal recourse to the U.S. parent bank for the performance of a specific swap, it does not extend jurisdiction to cases where the parent U.S. bank is implicitly or even explicitly committed to guarantee the subsidiary in general.”

Background on the Financial Stability Oversight Council

The Financial Stability Oversight Council (FSOC) is a crucial part of the Dodd-Frank Act, and was created in direct response to weaknesses in our system of financial regulatory oversight revealed by the 2008 financial crisis. Recently questions have been raised concerning FSOC’s powers to designate non-bank financial companies for oversight, and the level of transparency for Council activities. This document reviews the reasons for FSOC’s creation, gives a detailed breakout of the steps in the FSOC designation process, and discusses the issue of FSOC transparency.

AFR in the News: House Passes Bill to Aid Koch Brothers, Deregulate Wall Street

“The bill includes… measures sought by the largest Wall Street banks and the Koch brothers, who control significant financial and energy derivatives operations,” writes Zach Carter of the Huffington Post. “Americans for Financial Reform, the premier policy analysis organization among bank watchdogs, advocated strongly against the bill alongside consumer groups and the AFL-CIO.”

AFR, 60 Organizations Urge FHFA to Help Homeowners with Principal Reduction

Sixty groups, along with Americans for Financial Reform, sent a letter to Federal Housing Finance Agency Director Mel Watt today regarding the use of principal reduction as a loss mitigation strategy.

AFR in the News: Liberal Groups Back ‘Operation Choke Point’

In CQ, reporter Ben Weyl quotes from a joint AFR/CFA/NCLC letter to Senators: “Fighting payment fraud should not be controversial. Everyone benefits from efforts to stop illegal activity that relies on the payment system.” As Weyl goes on to note, “Conservative activists and GOP lawmakers have accused the Obama administration of pursuing law-abiding businesses that cross the administration’s agenda, including gun sellers.” But the known investigations launched in the name of Operation Choke Point have all been directed at out-and-out-fraud.

House Reauthorization Bill Would Undermine Rather than Support CFTC

“The Commodity Futures Trading Commission (CFTC) has a huge role to play in protecting consumers and the economy against fraud, price manipulation, and reckless speculation… Unfortunately, HR 4413 would seriously interfere with the agency’s ability to fulfill its mission and defend our economic security.”

AFR Supports the Waters and Moore Amendments, Rejects HR 4413

Download the letter here.

AFR Urges Fed and OCC to use leftover funds to Help Homeowners

AFR submitted a letter to the Fed and the OCC suggesting that leftover funds from the Independent Foreclosure Review (IFR) be spent to help current and Former homeowners who have been hurt in the foreclosure crisis.

Organizations Support the CFTC – Oppose HR 4413

AFR and other organizations have submitted letters and materials to members of Congress opposing HR 4413.

AFR and More Than 25 Orgnizations Support Operation Choke Point and Other Efforts to Fight Payment Fraud

AFR sent a letter to members of Congress urging them to oppose any effort block funding for the Department of Justice’s Operation Choke Point or to weaken other regulator efforts to fight payment fraud. This proposal works to ensure that banks and payment processors comply with longstanding due diligence requirements so that they can avoid facilitating illegal activity by knowing their customers, monitoring return rates, and being alert for suspicious activity.