The House Financial Services Committee yesterday approved a bill to roll back significant portions of the financial-crisis-era overhaul known as the Dodd-Frank Act in a vote that was largely down party lines, the New York Times reported today. The legislation, the Financial Choice Act, is not expected to be adopted this year, but it could influence the broader debate over financial reform and provide a starting point for its sponsor, Jeb Hensarling (R-Texas), the chairman of the House Financial Services Committee, whose leadership role on the panel is set to end in two years. Hensarling has been a prominent critic of Dodd-Frank and other changes after the 2008 financial crisis, including the creation of the Consumer Financial Protection Bureau to regulate the consumer finance industry. The legislation, which was unveiled in June, calls for numerous changes to Dodd-Frank. One provision would allow some of the largest banks to exempt themselves from some regulatory standards if they maintained an important ratio of capital to total assets at 10 percent or more. The bill would also repeal the Volcker Rule, which aimed to stop banks from making risky bets with their own money, and replace regulators’ authority to wind down troubled banks with a new chapter of the Bankruptcy Code. In addition, it would remove the Durbin Amendment, which set a limit on certain fees retailers are charged for debit card transactions.
