House Passes Financial Reform Bill; Senate Action Likely Mid-July

By Sarah Borchersen-Keto, CCH Washington News Bureau, Contributing Author, the CCH Federal Banking Law Reporter.

The House of Representatives voted 237 to 192 in favor of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Senate, where Republican support for the bill continues to be sought, is not expected to take it up until mid-July.

President Obama said June 30, 2010, that the vote was a “victory for every American who has been affected by the recklessness and irresponsibility that led to the loss of millions of jobs and trillions in wealth.” Treasury Secretary Tim Geithner said the Dodd-Frank Act was a “strong bill” that would provide “essential protections for consumers and investors.”

House Financial Services Committee Ranking Member Spencer Bachus, R-Ala., called the bill a “massive intrusion of the federal government into the lives of every American.”

House and Senate conferees met a day earlier to reconfigure a portion of the bill that would have levied a $19 billion fee on large financial institutions and hedge funds. Conferees agreed to drop the fee and replace it with a plan to end the Troubled Asset Relief Program (TARP) early, and to increase the Federal Deposit Insurance Corp. Deposit Insurance Fund (DIF).

Sen. Scott Brown, R-Mass., whose opposition to the $19 billion fee was a major factor in its removal from the bill, said that while he appreciated the conferees’ action, he will continue to review the bill over the July recess. “I remain committed to putting in place safeguards to prevent another financial meltdown, ensure that consumers are protected, and that this bill is paid for without new taxes,” Brown said.