In a letter dated March 2, 2012, a collection of industry groups representing financial firms sent a letter to the U.S. Treasury Department, urging the Treasury to defray the start-up costs of a new regulatory agency tasked with monitoring Wall Street. Under the Dodd-Frank financial reforms, a new agency, the Office of Financial Research, is scheduled to be financed with fees levied on banks starting this coming July. The Office of Financial Research is tasked with collecting and analyzing bank data in an effort to prevent a repeat of the liquidity problems faced during the financial crisis. In the March 2, 2012 letter, the groups stated that the financial firms should not have to provide the initial start-up costs for the agency. Rather, the industry groups stated that the new agency, which has taken two years to get partially staffed for its work, should get its initial funding from the Federal Reserve: “We believe that a corresponding adjustment should be made to the initial assessment basis to adjust for the delay,” the industry groups said. The letter also voiced complaints similar to those made by lawmakers in the past that the Treasury has been too slow getting the new agency up and running. However, the letter has received criticism from at least one group, the nonprofit Better Markets, which promotes the public interest in connection with the financial markets. Better Markets analyzed the bank’s proposal as a “request for a handout.” (“Wall Street Says New Oversight Agency Is Too Costly,” The New York Times, March 7, 2012).
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Banks oppose funding new regulatory agency
- Sedgwick LLP
- Jennifer Q. Broda, Matthew M. Ferguson, Jennifer Hamilton, Thomas R. Orofino and Eric C. Scheiner
- March 28 2012
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