Dodd-Frank Act

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President Barack Obama (left) in conversation with (from right) Chris Dodd, Dick Durbin and Barney Frank (June 17, 2009)

The Dodd – Frank Wall Street Reform and Consumer Protection Act ( Dodd – Frank Act for short ) is a US federal law which , in response to the financial market crisis of 2007, comprehensively changes the financial market law of the United States . The bill is named after then Chairman of the Senate Banking, Housing and Urban Development Committee , Chris Dodd , and then Chairman of the House Financial Services Committee , Barney Frank , and was signed on July 21, 2010 by President Barack Obama passed. The Dodd-Frank Act comprises a total of 16 titles with 541 articles of law on 849 pages. According to the preamble, the aim of the law is to promote the stability of the financial market in the United States of America. This is to be achieved by improving accountability and transparency in the financial system and by ending the problem of the factual obligation to rescue financial service companies that are considered systemically relevant for the financial system (English too big to fail ). US taxpayers are to be protected from abusive practices in financial services by ending state bailouts for financial services companies.

overview

The first title of the law creates the Financial Stability Oversight Council, a council to monitor the stability of the US financial market and to coordinate the activities of the federal financial market supervisory authorities, that of the federal finance minister, the chairmen of the federal financial market supervisory authorities and an independent one from the president a member appointed with the consent of the Senate with expertise in the field of insurance. Among other things, the Council can, with a two-thirds majority, place financial services companies outside the banking sector under the supervision of the US Federal Reserve. The Financial Stability Oversight Council is supported in its work by an Office of Financial Research located at the Ministry of Finance .

The second title of the law gives federal financial market regulators the power to place certain financial services companies in receivership and orderly liquidation when they are in financial difficulty and threaten the stability of the United States' financial market. Under this heading, among other things, the participation of the creditors is to be applied to bank rescues .

The third title of the law dissolves the federal savings bank supervisory authority , the Office of Thrift Supervision , and subdivides its activities into the federal banking supervisory authority for banks with a nationwide banking license , the Office of the Comptroller of the Currency .

The fourth title of the law places asset managers of investment funds not approved for public sale in the USA (e.g. hedge funds , private equity funds, etc.) under the supervision of the federal securities and stock exchange supervisory authority, the Securities and Exchange Commission .

The fifth title of the law creates within the Federal Treasury , the US Department of the Treasury , an office responsible for insurance matters, the Federal Insurance Office . The Federal Insurance Office oversees the United States insurance market with the exception of health insurance, nursing care insurance, and crop insurance. Insurance companies continue to be overseen by the insurance regulators of the United States. The Federal Insurance Office can recommend to the Financial Stability Oversight Council that insurance as a non-bank financial company should also be placed under the supervision of the US Federal Reserve. In addition, the Federal Insurance Office is responsible for developing the policy for the regulatory aspects of international insurance matters. This includes serving the United States in the International Association of Insurance Supervisors. In addition, the Federal Insurance Office supports the Federal Minister of Finance in negotiating bilateral or multilateral agreements on the recognition of supervisory measures for the insurance and reinsurance business, which achieve a level of protection for customers that is essentially equivalent to the regulations of the member states. The Federal Insurance Office is also authorized to suspend regulations of member states which contradict bilateral or multilateral agreements and put foreign insurance companies at a disadvantage compared to US insurance companies approved in this member state.

Title six of the Act places a moratorium on the Federal Deposit Insurance Corporation to insure deposits with credit card issuers, industrial lending companies, and certain other companies regulated by the Bank Holding Company Act of 1956. He strengthens the regulatory regulation of banks, savings banks and their holding companies. The reinforcements include significant restrictions on proprietary trading and sponsorship of investments in hedge funds or private equity funds for banks through the Volcker Rule , better supervision of subsidiaries that do not have a banking license, improved restrictions on related party transactions, restrictions on risks in the Connection with derivatives and for counterparty risk in securities lending and the obligation for companies that a company insured with the state deposit insurance company controls to strengthen the finances of such companies.

The law restricts the ability of banks to make risky bets on the financial market for their own account. Only limited investments in hedge funds and private equity are allowed. Economic historian Charles Geisst described the new law as the most comprehensive financial regulation since the Great Depression ; Nevertheless, it does not represent such a fundamental change as the changes made at the time.

Title Fifteen (Sec. 1502) imposes documentation and disclosure obligations on companies that use certain “conflict minerals” ( gold , wolframite , cassiterite and coltan are defined as such in the law ) to ensure that no raw materials are used serve to finance the armed conflict in the Democratic Republic of the Congo or a neighboring country.

List of chapters of the Dodd-Frank Act

  1. Title I IIVX- Financial Stability
  2. Title II IVX- Orderly Liquidation Authority (authorization for orderly liquidation)
  3. Title III VX- Transfer of Powers of the Comptroller of the Currency, the Corporation, and the Board of Governors (transfer of powers to the federal banking supervisory authorities)
  4. Title IV IIX- Regulation of Advisers to Hedge Funds and Others (regulation of asset managers from hedge funds and others)
  5. Title V IIIX- Insurance
  6. Title VI IIX- Improvements to Regulation of Bank and Savings Association Holding Companies and Depository Institutions (improvements in the regulation of holding companies for banks and savings banks)
  7. Title VII IX- Wall Street Transparency and Accountability
  8. Title VIII X- Payment, Clearing, and Settlement Supervision (monitoring of payment transactions, clearing and settlement)
  9. Title IX IIX- Investor Protections and Improvements to the Regulation of Securities (Investor Protection Provisions and Improvements to the Regulation of Securities)
  10. Title X IIIV- Bureau of Consumer Financial Protection
  11. Title XI IIX- Federal Reserve System Provisions (Central Bank Provisions)
  12. Title XII IX- Improving Access to Mainstream Financial Institutions (improving access to widespread financial services companies)
  13. Title XIII V- Pay It Back Act
  14. Title XIV II- Mortgage Reform and Anti-Predatory Lending Act (Mortgage Reform and Abusive Lending Act)
  15. Title XV III- Miscellaneous Provisions
  16. Title XVI II- Section 1256 Contracts (contracts under Article 1256)

See also

Web links

Individual evidence

  1. ^ Damian Paletta: It Has A Name: The Dodd / Frank Act. The Wallstreet Journal , June 25, 2010.
  2. ↑ Damian Paletta: US Lawmakers Reach Accord on New Finance Rules. The Wallstreet Journal, June 25, 2010.
  3. ↑ Eric Dash, Andrew Martin: New Rules May Affect Every Corner of JPMorgan. The New York Times, June 25, 2010.
  4. ^ Dodd-Frank Wall Street Reform and Consumer Protection Act - HR4173
  5. ↑ Certification of conflict resources ( Memento of the original from April 4, 2013 in the Internet Archive ) Info: The archive link was automatically inserted and not yet checked. Please check the original and archive link according to the instructions and then remove this notice. (PDF; 41 kB) @1@ 2Template: Webachiv / IABot / www.medico.de