The first peals of what might be the death knell for the Dodd-Frank Act were chimed today at the White House.
According to a New York Times report, President Donald Trump used a meeting with the leaders of major U.S. businesses to announce the signing of a directive calling for changes in key provisions within the Dodd-Frank Act. While the President does not have the authority to void the 2010 legislation, his action sent a clear signal to the Republican-controlled Congress that he will be open to any legislative changes they might put forward.
“We expect to be cutting a lot out of Dodd-Frank because frankly, I have so many people, friends of mine that had nice businesses, they can’t borrow money,” President Trump said in the State Dining Room during his meeting. “They just can’t get any money because the banks just won’t let them borrow it because of the rules and regulations in Dodd-Frank.”
President Trump also signed a second directive to halt a scheduled Labor Department rule signed by his predecessor that is designed to force brokers to act in a client’s best interest when offering retirement advance instead of seeking the highest profits for themselves.
"NAMB has, and will continue to discuss with the CFPB the impact of over regulation on consumers," said Fred Kreger, president of
NAMB—The Association of Mortgage Professionals. "One of our greatest concerns is the disparate impact created by the three percent cap rule on lower income borrowers. With the signing of today’s executive order we look forward to renewed discussions regarding this issue along with many others."
The President’s actions were quickly criticized by John Taylor, president and CEO of the National Community Reinvestment Committee.
“President Trump's actions today will ultimately be toxic for working families,” he said. “He should reverse the orders. Rather than slashing consumer protections, the administration should be focused on ways to create jobs by requiring financial institutions to invest safely and soundly, to revitalize communities, to improve affordable homeownership opportunities for working people, and to ensure that the nation’s start-ups and small businesses have access to capital. Rather than just meeting with banking executives, as he did this morning, he should be holding them accountable and working to help working families that are struggling to climb the economic ladder.”
However, the Financial Services Roundtable offered its praise of the directives.
"Modernizing America's financial regulatory system in ways that will grow the economy, create jobs and protect consumers as well as taxpayers is a key ingredient to boosting financial opportunities for America's families and businesses," said CEO Tim Pawlenty.
Dan Berger, president and CEO of the National Association of Federally-Insured Credit Unions, was also satisfied with this development. “We welcome regulators taking a hard look at the Dodd-Frank Act for ways to lift current burdens, but we will also continue to press the CFPB to use the authority it has now to exempt credit unions from regulations that were created to address abuses in which credit unions did not engage,” said Berger. “Ultimately, we look forward to the administration, Congress and the regulators working together to reduce regulatory burden. We will continue to advocate for credit unions’ best interests as this review moves forward.”
