US passes strict bank curbs
Source: Agencies |
July 17, 2010, Saturday
|
Print Edition
Print Edition
UNITED States Congress has passed fundamental new controls on banks and financial institutions, imposing the most stringent new curbs since the 1930s Great Depression and handing President Barack Obama his third major legislative victory.
Obama's Democrats prevailed on Thursday after a year of pushing the legislation that won approval of only three Republicans in a 60-39 vote. The Senate roll call reflected the unrelenting partisanship that grips the US with the approach of congressional elections in November.
The measure was closely watched globally for proof that Obama could deliver on his promise to crack down on financial practices that took the American financial system to the verge of collapse 22 months ago. Countries across the world are still trying to recover from the meltdown that swept through the global economy.
"I'm about to sign Wall Street reform into law, to protect consumers and lay the foundation for a stronger and safer financial system, one that is innovative, creative, competitive and far less prone to panic and collapse," Obama said.
"Unless your business model depends on cutting corners or bilking your customers, you have nothing to fear."
The law gives the government new powers to break up companies that threaten the economy, create a new agency to guard consumers in their financial transactions and force transparency on shadow financial markets that escaped the oversight of regulators.
The vote came on the same day that Goldman Sachs & Co agreed to pay a record US$550 million to settle charges that it misled buyers of mortgage-related investments.
Large, failing financial institutions would be liquidated and the costs assessed on their surviving peers. The Federal Reserve is getting new powers while falling under greater congressional scrutiny.
Consumer and investor transactions, whether simple use of debit cards to the most complex securities trades, face new safeguards or restrictions.
"When this earthquake hit, there wasn't nearly enough oversight, transparency or accountability to shield us from the fallout," Senate Majority Leader Harry Reid said. "This law will strengthen all three."
The White House said Obama likely would sign the bill next week.
Obama's Democrats prevailed on Thursday after a year of pushing the legislation that won approval of only three Republicans in a 60-39 vote. The Senate roll call reflected the unrelenting partisanship that grips the US with the approach of congressional elections in November.
The measure was closely watched globally for proof that Obama could deliver on his promise to crack down on financial practices that took the American financial system to the verge of collapse 22 months ago. Countries across the world are still trying to recover from the meltdown that swept through the global economy.
"I'm about to sign Wall Street reform into law, to protect consumers and lay the foundation for a stronger and safer financial system, one that is innovative, creative, competitive and far less prone to panic and collapse," Obama said.
"Unless your business model depends on cutting corners or bilking your customers, you have nothing to fear."
The law gives the government new powers to break up companies that threaten the economy, create a new agency to guard consumers in their financial transactions and force transparency on shadow financial markets that escaped the oversight of regulators.
The vote came on the same day that Goldman Sachs & Co agreed to pay a record US$550 million to settle charges that it misled buyers of mortgage-related investments.
Large, failing financial institutions would be liquidated and the costs assessed on their surviving peers. The Federal Reserve is getting new powers while falling under greater congressional scrutiny.
Consumer and investor transactions, whether simple use of debit cards to the most complex securities trades, face new safeguards or restrictions.
"When this earthquake hit, there wasn't nearly enough oversight, transparency or accountability to shield us from the fallout," Senate Majority Leader Harry Reid said. "This law will strengthen all three."
The White House said Obama likely would sign the bill next week.
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