U.S. Rep. Ron Kind (D-WI), Vice-Chair of the New Democrat Coalition, which led the way in calling for Wall Street reform, today voted to protect consumers and hold Wall Street banks accountable through the Wall Street Reform and Consumer Protection Act, H.R. 4173, so that we never again come close to the near economic collapse faced last year. The bill passed 237-192.
"Today we put an end to bailouts for big banks, established tough consumer protections, and most importantly, put into place strict rules against risky financial practices that will hold Wall Street more accountable," said Rep. Kind. "Never again will taxpayers be held hostage by large institutions that make bad decisions jeopardizing the entire United States economy."
The legislation holds Wall Street accountable through increased transparency and regulation of risky practices. A new systemic risk regulator will monitor financial activity across the whole sector to identify risks and irresponsible behavior and prevent them from becoming a problem for individual investors and the entire economy. The bill also establishes an orderly process for dismantling large, failing banks - at their own expense, and requires that stockholders and executives take a financial hit if risky deals fall through, ensuring an end to taxpayer funded bailouts.
The bill also enacts several measures to protect consumers including:
* Ensuring that credit cards and mortgages are fair, transparent, and understandable by creating the Consumer Financial Protection Agency (CFPA), a new, independent federal agency solely devoted to protecting Americans from unfair and abusive financial products and services and providing quality information about potential risks.
* Helping protect 401k and pension plans by stopping institutions from taking risks that threaten the financial system and can cause a crash.
* Addressing the problems in the derivatives market by increasing transparency in order to protect economic growth.
* Ending predatory lending practices so that lenders can't put consumers into an unaffordable or difficult to understand loan.
"These reforms are critical to preventing another financial meltdown," said Rep. Kind. "This bill injects transparency and accountability into our financial system to make sure banks play by the rules and at the same time, protects consumers and small businesses' ability take appropriate risk to support economic growth and job creation."