“It’s a lousier time than usual to be a lowly member of the investing public looking for protection from the sharks of finance.
Deep-pocketed banks are dominating the process of writing the new financial rules mandated by the Dodd-Frank Act, dwarfing the efforts of investor advocates looking to rein in the banks.
At the Securities and Exchange Commission, which is charged with protecting investors, lawbreakers can cut sweet deals for exemptions from punishments before the ink is dry on their settlement papers.
The public’s concern that regulators “are on the same team or focused in the same way as the entities they are supposed to be regulating” is a valid one, New York University Law School professor Rachel Barkow said on a panel at the New York City Bar Association last month. If more of an effort were made to have representatives of consumers at agencies, “you might have a more proactive movement right now to break some of the big banks up,” she said.
Public interest groups such as Americans for Financial Reform and Better Markets had 64 meetings with the regulators. The financial industry and its representatives: 551.
Those sit-down meetings “are where the real work is taking place,” Krawiec says. “And the meetings were almost completely dominated by financial firms, their trade groups and their law firms.”
Regulators aren’t turning away public-interest groups that ask for meetings. It’s just that the financial industry has such vast resources that it overpowers the conversation. “Despite a significant expansion in the number of foot soldiers out there working in the public interest on these financial issues, we are still completely overwhelmed by the industry lobbyists,” said Dennis Kelleher, chief executive officer of Better Markets.
Read Susan Antilla’s full Bloomberg View article here