Dodd-Frank Wall Street Reform Analysis

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Recommended: The "Frank Wall Street Reform and Consumer Protection Act

The Dodd-Frank Wall Street Reform and Consumer Protect Act, is a piece of financial reform legislation passed in 2010, shortly after the housing crisis, by the Obama administration. It is named after key sponsors Senator Christopher Dodd and Representative Barney Frank. This act served as a response to the financial crisis of 2008. Its intention was to decrease the risks in the U.S. financial system. This act helped establish numerous government agencies, who are given the task of overseeing and regulating different aspects of the banking system. It is important to note, the Trump administration is working to repeal the act, as of June 8th. Recently, the Republican controlled U.S. House of representatives have voted to repeal and replace it with the Financial CHOICE act, which plans on …show more content…

It is also tasked with providing restricting or possibly liquidations, delivered by the Orderly Liquidation Fund, which provides capital to aid in the closing of financial intuitions that have either been placed in receivership, in addition to preventing another government bailout via tax dollars. Banks that are considered “Too big to fail”, can be broken up under the authority of the council. These are banks who may pose incredible systematic risk (risk in the economy). In addition, the council may require banks to increase their reserve requirements. In addition, we have the CFPB, which is tasked with preventing predatory mortgage lending, this is believed to reflect that belief that the subprime mortgage lending was the key cause in the 2008 crisis. Furthermore, it no longer allows for mortgage brokers to earn increased commissions for closing loans with higher interest rates or fees. Eliminating the incentive of predatory mortgage

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