“Congress is poised to enact the first significant rollback of the sweeping 2010 overhaul of financial regulations by including in a government spending bill a provision that eases bank trading of complex derivatives.
“The provision sparked controversy as lawmakers prepared to vote on the $1.1-trillion package that must pass before a Thursday night deadline to avoid a federal government shutdown.
“Derivatives and other complex securities were blamed in part for triggering the 2008 financial crisis. New limits on their trading were a key component of the Dodd-Frank financial reform law.”
“Financial reform supporters were outraged Wednesday that the provision easing derivatives restrictions, based on legislation that passed the House in 2013 but never got a Senate vote, was included in the spending bill.
“This is by far the largest repeal of a significant financial reform provision since the crash,” said Dennis Kelleher, chief executive of Better Markets Inc., a Washington advocate of stricter financial regulation. “It shifts the downside of Wall Street’s high-risk derivatives-dealing back to the taxpayers.”
“A coalition of key liberal lawmakers and advocacy groups scrambled to save the derivatives restrictions.”
Read the full Los Angeles Times article here.