Search Form
First, enter a politician or zip code
Now, choose a category

Public Statements

Ross: "The Dodd-Frank Act Created the "Ultimate Hangover' Cure -- and Charges Non-Drinkers to Pay for It"


Location: Unknown

U.S. Rep. Dennis Ross (FL-15) issued a statement following the House Financial Services Committee Subcommittee on Oversight & Investigations hearing, "Who Is Too Big to Fail: Does Title II of the Dodd-Frank Act Enshrine Taxpayer-Funded Bailouts?":

"Based on the evidence presented this morning, it is clear the Orderly Liquidation Authority authorized by the Dodd-Frank Act does more to prop up bad actors and failing firms than to protect America's financial sector. Through the creation of these bridge holding companies, due process to creditors is ignored, investor risk is ceded to the taxpayer through the federal government, and unprecedented competitive advantages are given to companies that should in most cases end up in Bankruptcy Court. What's worse is that relatively smaller, successful banks such as regional banks, and certain non-bank institutions such as designated insurance companies -- are taxed to pay for the costs.

"The Dodd-Frank Act created the ultimate "hangover cure,' and charges non-drinkers to pay for it."


Title II of the Dodd-Frank Wall Street Reform Act (PL 111-203) created an Orderly Liquidation Authority (OLA) available to the Federal Deposit Insurance Corporation (FDIC). The OLA allows the FDIC to seize failing financial and non-bank institutions it feels may pose a systemic risk to the financial soundness of the U.S.

During an OLA process, the FDIC may selectively transition assets and liabilities of a failing institution to a bridge holding company, and the FDIC can lend the bridge holding company up to 90 percent of the bridge holding company's total consolidated assets through loans obtained from the U.S. Treasury.

If the Treasury loses on its investment in a bridge holding company, after seeking limited additional recovery from certain creditors, the FDIC will impose assessments on other healthy financial and non-banking institutions -- large and regional banks and brokerage firms, as well as designated non-bank financial institutions, which will likely include large insurance companies. These healthy financial companies will be the true guarantors of the Treasury's potential largesse and ultimately will pass these costs onto their customers -- homeowners, families, and businesses that purchase insurance or use banking and brokerage services.

The FDIC may authorize bridge holding companies for up to five years, during which time the institutions are not required to pay any franchise, income, or property taxes; are exempt from federal and state capital requirements; and may receive short-term, lower-rate loans from the FDIC.

This is the third in a series of hearings by the Subcommittee on Oversight & Investigations on the Too Big to Fail provisions of the Dodd-Frank Act.

Skip to top

Help us stay free for all your Fellow Americans

Just $5 from everyone reading this would do it.

Back to top