Washington, D.C., June 19, 2014 – Better Markets released the attached Cross Border Fact Sheet today detailing Wall Street’s latest tactic to avoid important financial reforms designed to protect U.S. taxpayers from having to bail out Wall Street again. The tactic is called “de-guaranteeing” foreign affiliates, which is just a fancy word for Wall Street’s biggest banks plan to ship their derivatives activities and jobs overseas where U.S. law might not apply.
As discussed in the attached Fact Sheet and as was seen in 2008, however, Wall Street moving activities and jobs overseas does not reduce the risk to the U.S. when a financial crisis happens and U.S. taxpayers have to bail out U.S. banks and their foreign activities. That’s exactly what happened to AIG and so many other banks in the 2008 financial crash.
The CFTC and SEC must enact strong financial reform rules to prevent Wall Street from evading U.S. law and needlessly putting the U.S. financial system and U.S. taxpayers at risk again. Evasive, if not fraudulent, “de-guaranteeing” must be expressly prohibited.