U.S. Chamber Calls on Senate to Fix Financial Regulatory Reform Bill

House Vote Shows Growing Doubts About Ill-conceived CFPA, Permanent Bailout Funds

WASHINGTON, D.C.—David Hirschmann, president and CEO of the U.S. Chamber of Commerce's Center for Capital Markets Competitiveness (CCMC) today made the following statement after the passage of a massive financial regulatory reform bill in the House that also creates a new so-called Consumer Financial Protection Agency (CFPA):

"While we are disappointed with House passage of a 1,300-page financial regulatory reform bill that leaves many of the underlying issues unaddressed, we are encouraged that there is growing recognition that there is a better way to overhaul our outdated, financial regulatory system. We now look forward to working with the Senate to advance more effective reforms that will protect investors and strengthen our capital markets without adding new layers of bureaucracy on top of the current system. Enacting the wrong financial regulatory reforms will have adverse consequences and will be felt throughout every corner of the economy and delay Main Street recovery.

Thanks to the work of a growing group of moderate Democrats, some important improvements to the administration's original approach were made in the House with strong bi-partisan support. The Manager's amendment included an important preemption standard for the CFPA that will go a long way in fostering consistency in consumer laws and disclosure, and an amendment was adopted that will help preserve the ability for companies across the country to prudently manage their day-to-day risks. And, while the bill remains fundamentally flawed, the process demonstrated the growing bi-partisan recognition that creating new and massive government bureaucracies or permanent bailout programs will actually harm consumers, investors and America's job creators.

"While there is a laundry list of bad choices that were made by the House, the creation of the CFPA tops the list. The CFPA will have massive authority to regulate businesses in virtually all industries, even those not directly involved in consumer finance. This legislation was written with far-too-broad definitions and vague regulatory standards, exposing businesses to excessive regulation and potential litigation. The uncertainty surrounding these regulatory standards and increased liabilities will create significant disincentives for institutions that lend to consumers, restricting access to credit and increasing the price of credit for consumers."

The Chamber's CCMC, created three years ago, has led a bipartisan effort to modernize and strengthen the outmoded regulatory systems. Fundamental to this effort, the Chamber believes in strong consumer protections, the elimination of duplicative regulation, and strong enforcement against illegal financial activities. Earlier this week the CCMC called for an fresh approach to improving consumer protections, including a Consumer Protection Council to ensure coordination among preexisting financial regulators. The council would ensure regulatory gaps are eliminated, prescribe consistent disclosure and examination standards and identify areas in which new regulations are necessary.

The CCMC is committed to working aggressively with the administration, Congress, and global leaders to implement reforms to strengthen the economy, restore investor confidence, and ensure well-functioning capital markets.

The U.S. Chamber is the world's largest business federation representing more than 3 million businesses and organizations of every size, sector, and region.

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