Friday, September 19, 2014
This paper uses case studies from the history of the Federal Reserve to illustrate the capacity of “soft constraints” to impose meaningful limits on an agency’s effective independence. It first examines the constraining effect of principled norms, that is, principles that are generally accepted by experts and policymakers and that dictate how the Fed ought to act in a given set of circumstances. Using the real bills doctrine, Bagehot’s dictum, and the Taylor rule as examples, the analysis suggests that even when the Fed has no legally enforceable obligation to act in accord with a principled norm, the existence of the norm shapes Fed action and discussions about the same. The second soft constraint the paper examines is the reputation of the Fed Chairperson. Fed Chairs often serve for exceptionally long periods, exercise significant influence while in office, and are held accountable, by politicians, the press and academics, for actions the Fed takes while they are in office. Fed Chairs thus have the incentive and means to influence the Fed’s actions to enhance their individual reputations. Based on these analyses, the paper suggests that soft constraints play a meaningful and underappreciated role shaping Fed action and facilitating transparency and oversight.
The paper also considers the ramifications of soft constraints for debates about the Fed’s authority and discussions about agency independence more generally. It suggests that soft constraints should reduce the likelihood of arbitrary action, thus serving as a partial substitute for political accountability and enhancing agency legitimacy. Soft constraints also serve as important complements to traditional mechanisms of accountability by increasing transparency and serving as a reference points that facilitates discussion and oversight. The paper further suggests that soft constraints may be particularly important in settings where there are significant drawbacks to using formal tools to enhance accountability.
"What Is 'Financial Stability'? The Need for Some Common Language in International Financial Regulation" Georgetown Journal of International Law, Vol. 45, Forthcoming Suffolk University Law School Research Paper No. 14-28 HILARY J. ALLEN, Suffolk University Law School
Post-Crisis international financial regulation is animated by the buzzwords “financial stability,” but surprisingly little attention has been paid to what these buzzwords actually mean. This Article argues that there are many — largely unexplored — disagreements regarding the meaning of “financial stability,” and that this lack of consensus has the potential to cause a host of problems. Chief amongst these is that disagreement about the meaning of “financial stability” can thwart harmonized national implementation of international financial stability regulation. To draw attention to this largely-ignored definitional problem, and to start the process of addressing it, this Article proposes a working definition of “financial stability.” The proposed definition reflects technical notions about the state of financial institutions and markets during periods of stability, as well as a value-based assessment of the financial system as a means to broader global economic prosperity, rather than an end in itself.
"Willingness to Pay to Reduce White Collar and Corporate Crime" Vanderbilt Law and Economics Research Paper No. 14-28 MARK A. COHEN, Vanderbilt University - Owen Graduate School of Management, Vanderbilt University - Law School, Resources for the Future
Consumer protection and financial regulatory agencies such as the Federal Trade Commission (FTC), the Securities and Exchange Commission (SEC), and the Consumer Financial Protection Bureau (CFPB) regulate various types of consumer, investor and financial frauds. Whether required or not, rulemaking proceedings oftentimes include some form of cost-benefit analysis. Thus, the benefits of proposed regulations – whether fully quantified or not – are an increasingly important component of rulemaking decisions. Anecdotal evidence suggests that the impact on victims in some cases include significant time and financial hardships and even pain, suffering and reduced quality of life. Further, the existence of these offenses causes non-victims to take costly precautionary behavior and might even inhibit legitimate business activities. Yet, little is known about the true costs of consumer and financial crimes other than the out-of-pocket monetary losses incurred by victims. To the extent society wishes to optimally deter such crimes, without better data on nonmonetary costs, any cost-benefit analyses of criminal justice or prevention programs designed to reduce these crimes will inevitably underestimate program benefits. This paper provides an initial framework and empirical estimates of the willingness-to-pay to reduce four types of white collar and corporate offenses – consumer fraud, financial fraud, corporate crime and corporate financial crime. Utilizing a contingent valuation survey approached that has been used to estimate the cost of street crimes, the average willingness to pay for a 10% reduction in each of these four offenses is estimated to range between $70 and $75 per household. In the case of consumer fraud and financial fraud – where estimates of prevalence are available, this translates into a willingness to pay of $2,700 per consumer fraud and $21,000 for financial fraud. In contrast, the out-of-pocket costs to victims of consumer fraud have been estimated to average about $100, and about $200 to $250 for various types of financial frauds. These figures also compare favorably to the willingness to pay for a reduced household burglary of $18,000.
INTERNATIONAL FINANCE eJOURNAL
DIANA CONSTANZA RESTREPO OCHOA, Universidad Carlos III de Madrid - Department of Business Administration JOSE RICARDO CORREIA, University of Manchester - Division of Accounting and Finance, Universidad Carlos III de Madrid JUAN IGNACIO PEÑA, Universidad Carlos III de Madrid - Department of Business Administration JAVIER POBLACIÓN, Bank of Spain
We build a Real Options model to assess the importance of private provision and the impact of expropriation risk on investment timing, investment volumes, governmental costs and social welfare. We consider two types of businesses (essential and non essential businesses) and two stages (operating and investment opportunities), and answer questions regarding three main topics: the firm's reaction to expropriation risk, the government drivers to expropriate, and the costs this generates in terms of welfare. We find that the firm makes suboptimal investment decisions. When we endogenize the reputational costs of expropriation, results show that the decision of the government regarding the level of political risk will largely depend on the type of business. However, in terms of welfare it is never optimal to expropriate.
34 countries (of which 31 are OECD) still maintain a substantial portfolio of state owned enterprises ("SOE") within their economies, totally 2,111 SOE employing 6 million persons, with over $2 trillion of value. Half of SOEs are in the telecoms, energy, transportation, and postal industries.
Non-trivial government investments in companies accounts for an additional $860 billion of investment employing 2.8 million persons.
The Size and Sectoral Distribution of SOEs in OECD and Partner Countries
This report analyses a dataset detailing the size of national state-owned enterprise (SOE) sectors (by number, value and employment) and their composition by sector and corporate forms for the year 2012.
Thursday, September 18, 2014
The International Monetary Fund (IMF) released today the results of the fifth annual Financial Access Survey (FAS), the most comprehensive global source of data on access to, and use of, basic consumer financial services by households and nonfinancial corporations. For the first time, the survey includes data on mobile money indicators.
The FAS provides geographic and demographic data worldwide, offering a strong quantitative underpinning to the theoretical literature linking financial inclusion and economic growth. The positive correlation between the increase in the use of commercial banks services (a measure of financial inclusion) and the increase in GDP per capita (a measure of economic growth) is especially noteworthy when comparing financial inclusion trends. Among African countries reporting data on commercial bank depositors, for instance, depositors per 1,000 adults experienced a five-fold increase from 2004 to 2013, while simultaneously achieving a 40-percent growth in real GDP per capita.
The enhanced 2014 FAS provides a quantitative foundation to assess the transformational role of mobile money in financial inclusion. For example, the results of the 2014 FAS round for Kenya show a dramatic increase in the number of active mobile money accounts in recent years. In 2007, mobile money accounts represented just 30 percent of deposit accounts in commercial banks, but by 2009, they surpassed the number of commercial bank deposit accounts. At the same time, the number of mobile money transactions increased by more than 130 times, from close to 5.5 million in 2007 to more than 700 million in 2013.
The 2014 round had a response rate of over 95 percent, with 184 reporting jurisdictions. The overall coverage of the survey indicators increased further relative to the previous round. In addition, around 35 countries reported data on mobile money.
The FAS database contains 152 time series resulting in 47 key indicators that are grouped into two dimensions: (i) geographic outreach of financial services; and (ii) use of financial services. The database includes annual data and metadata for 189 jurisdictions, including all G-20 economies, covering a ten-year period (2004–2013).
CFTC Charges Ohio Resident Glen Galemmo with Commodity Pool Fraud in a Multi-Million Dollar Ponzi Scheme
CFTC alleges that Galemmo solicited at least $116 million from pool participants and only deposited approximately $4.7 million of the funds into futures accounts
The U.S. Commodity Futures Trading Commission (CFTC) filed a civil enforcement Complaint against Defendant Glen Galemmo of Cincinnati, Ohio, charging him with operating a multi-million dollar Ponzi scheme through his firm, QFC, LLC, from February 18, 2010 through at least July 17, 2013.
[Glen Galemmo, 49, who owned Queen City Investments and other investment companies in the Cincinnati area, was sentenced in U.S. District Court to 188 months].
According to the Complaint filed on September 15, 2014, Galemmo, among other things, made material misrepresentations to commodity pool participants, including the misrepresentation that the pool generated returns of 17 percent to 40 percent from 2008 through 2012. The Complaint also alleges that Galemmo failed to disclose that he failed to trade pool participants’ funds from at least 2003 through May 2011. As alleged, beginning in April 2011, Galemmo only deposited approximately $4.7 million of over $116 million solicited from pool participants into futures accounts that he controlled and sustained total trading losses of approximately $1.2 million. Galemmo also allegedly withdrew or caused to be withdrawn $2.7 million in pool participants’ funds from these futures accounts.
For eight years, Galemmo operated a “Ponzi scheme” using money from new investors to pay off earlier investors. Galemmo received approximately $87 million cumulatively from individual investors, trusts, charitable organizations, and retirement accounts. During this time, Galemmo also received approximately $29 million from some of these investors in the form of short-term loans. The vast majority of these funds were never invested in anything. Galemmo used the investor accounts as his personal bank, paying country club fees, taking luxurious vacations and buying real estate, clothing and jewelry.
Galemmo sent fraudulent monthly statements to investors. To create the monthly statements, each client's principal investment balance was merely multiplied by a fictitious percentage of return, consistent with the returns that Galemmo had promised to his clients. The statements showed positive account balances and fictitious earnings, when in fact, the money had not been invested as promised. Investigators identified approximately 140 victims of Galemmo’s scheme.
Galemmo agreed to forfeit three pieces of real estate, including a condo in Marco Island, Florida, the contents of bank and investment accounts and five vehicles. The government also is asking the court to order that Galemmo forfeit more than $5 million in cash and investments, including some cash and investments that Galemmo transferred to his wife in an attempt to avoid the government seizing the assets. If the court orders the forfeiture, the forfeited property will go toward victim restitution.
In its continuing litigation, the CFTC seeks a return of ill-gotten gains, restitution, civil monetary penalties, trading and registration bans, and permanent injunctions against further violations of the federal commodities laws, as charged.
Wednesday, September 17, 2014
"Anthony Thompson, 38, of Bethesda, Maryland, and Jay Fung, 40, of Delray Beach, Florida, were arraigned in state Supreme Court in Manhattan in connection with the scheme, which prosecutors said took place between 2009 and 2012. They both pleaded not guilty to securities fraud and other charges.
The pair are accused of promoting the stocks with the help of penny stock websites that prosecutors say they controlled, including OxofWallStreet.com, PennyPic.com and MonsterStox.com. ... Other companies involved included Hydrogenetics Inc , Xynergy Holdings Inc, Blast Applications Inc, and Blue Gem Enterprise Inc."
Jack Kelly's article on CompliancEx is illuminating - a MUST read:
“After the savings and loans crisis, the government brought over 1,000 criminal prosecutions and got over 800 convictions” whereas there is a glaring lack of Wall Street bankers behind bars for their role in the financial collapse. ...
...“Banks have admitted to breaking the law and have settled with the US for $35 billion dollars, but despite the misconduct at these banks, not a single senior executive…has been criminally prosecuted”.
She cited an instance in which J.P. Morgan’s CEO was awarded a bonus for negotiating a settlement as opposed to facing criminal indictments. Additionally, he didn’t suffer any negative repercussions or consequences from his company. ...
Tuesday, September 16, 2014
The OECD released today its first recommendations for a co-ordinated international approach to combat tax avoidance by multinational enterprises, under the OECD/G20 Base Erosion and Profit Shifting Project designed to create a single set of international tax rules to end the erosion of tax bases and the artificial shifting of profits to jurisdictions to avoid paying tax.
At the request of the G20 Leaders, the OECD’s work is based on a BEPS Action Plan setting out the 15 key elements to be addressed by 2015. The project aims to help governments protect their tax bases and offer increased certainty and predictability to taxpayers, while guarding against new domestic rules that result in double taxation, unwarranted compliance burdens or restrictions to legitimate cross-border activity.
The first 7 elements of the Action Plan released today focus on helping countries to:
- ensure the coherence of corporate income taxation at the international level, through new model tax and treaty provisions to neutralise hybrid mismatch arrangements (Action 2);
- realign taxation and relevant substance to restore the intended benefits of international standards and to prevent the abuse of tax treaties (Action 6);
- assure that transfer pricing outcomes are in line with value creation, through actions to address transfer pricing issues in the key area of intangibles (Action 8);
- improve transparency for tax administrations and increase certainty and predictability for taxpayers through improved transfer pricing documentation and a template for country-by-country reporting (Action 13);
- address the challenges of the digital economy (Action 1);
- facilitate swift implementation of the BEPS actions through a report on the feasibility of developing a multilateral instrument to amend bilateral tax treaties (Action 15); and
- counter harmful tax practices (Action 5).
According to the Times, "Digital currencies such as bitcoin could threaten the economy if they became widespread, the Bank of England has warned. In the most extreme case, bitcoin’s decentralised payment system and finite supply could make central banks obsolete, create huge economic risks and trigger deflation. Even if the currency were fairly limited, sharp swings in value could threaten financial stability."
Further, BofE has said that virtual currencies could “make central banks obsolete, create huge economic risks and trigger deflation.” Morevoer, as is common place in attacking virtual currencies, BofE states that people could be defrauded and that governments would have to address “taxation, money laundering and the possible use of new payment systems in financing terrorism or other crime.” The BofE added: “The total stock of digital currencies is at present too small to pose a threat to financial stability, but further increases cannot be ruled out and it is conceivable in time that there could be an asset price crash among free-floating digital currencies that had the potential to affect financial stability.”
ZAO Hewlett-Packard A.O. (HP Russia), an international subsidiary of the California technology company Hewlett-Packard Company (HP Co.), pleaded guilty today to felony violations of the Foreign Corrupt Practices Act (FCPA) and was then sentenced for bribing Russian government officials to secure a large technology contract with the Office of the Prosecutor General of the Russian Federation.
HP Russia pled guilty to conspiracy and substantive violations of the anti-bribery and accounting provisions of the FCPA. According to the plea agreement, HP Russia executives created a multimillion dollar secret slush fund, at least part of which was used to bribe Russian government officials who awarded the company a contract valued at more than € 35 million. At the conclusion of the plea proceeding, the court sentenced HP Russia to pay a $58,772,250 fine. (See the German government's initial indictment that alerted the US DOJ.)
“In a brazen violation of the FCPA, Hewlett Packard’s Russia subsidiary used millions of dollars in bribes from a secret slush fund to secure a lucrative government contract,” said Principal Deputy Assistant Attorney General Miller. “Even more troubling was that the government contract up for sale was with Russia’s top prosecutor’s office.
Tech companies, like all companies, must compete on a level playing field, not resort to secret books and sham transactions to hide millions of dollars in bribes. The Criminal Division has been at the forefront of this fight because when corruption takes hold overseas, American companies and the rule of law are harmed. Today’s conviction and sentencing are important steps in our ongoing efforts to hold accountable those who corrupt the international marketplace.”
According to the statement of facts filed with the plea agreement, HP Russia created excess profit margins to finance the slush fund through an elaborate buy-back deal scheme. HP subsidiaries first sold the computer hardware and other technology products called for under the contract to a Russian channel partner, then bought the same products back from an intermediary at a nearly €8 million mark-up and an additional €4.2 million in purported services, then sold the same products to the Office of the Prosecutor General of the Russian Federation at the increased price. The payments to the intermediary were then largely transferred through multiple layers of shell companies, some of which were directly associated with government officials. Proceeds from the slush fund were spent on travel services, luxury automobiles, expensive jewelry, clothing, furniture and various other items.
To keep track of and conceal these corrupt payments, the conspirators inside HP Russia kept two sets of books: secret spreadsheets that detailed the categories of bribe recipients, and sanitized versions that hid the bribes from others outside of HP Russia. They also entered into off-the-books side agreements to further mask the bribes. As one example, an HP Russia executive executed a letter agreement to pay €2.8 million in purported “commission” fees to a U.K.-registered shell company, which was linked to a director of the Russian government agency responsible for managing the Office of the Prosecutor General of the Russian Federation project. HP Russia never disclosed the existence of the agreement to internal or external auditors or management outside of HP Russia.
On April 9, 2014, the government also announced criminal resolutions with HP subsidiaries in Poland and Mexico which violated the FCPA in connection with contracts with Poland’s national police agency and Mexico’s state-owned petroleum company, respectively. Pursuant to a deferred prosecution agreement, the department filed a criminal information charging Hewlett-Packard Polska, Sp. Z o.o. with violating the accounting provisions of the FCPA. Hewlett-Packard Mexico, S. de R.L. de C.V. entered into a non-prosecution agreement with the government pursuant to which it has agreed to forfeit proceeds and has admitted and accepted responsibility for its misconduct. In total, the three HP entities will pay $76,760,224 in criminal penalties and forfeiture.
In a related FCPA matter, the U.S. Securities and Exchange Commission (SEC) filed a proposed final judgment in April 2014 to which HP Co. consented. Under the terms of the proposed final judgment, HP Co. has paid $31,472,250 in disgorgement, prejudgment interest and civil penalties, bringing the total amount of U.S. criminal and regulatory penalties against HP Co. and its subsidiaries to more than $108 million. See SEC Press Information.
Court filings acknowledge HP Co.’s extensive cooperation with the department, including conducting a robust internal investigation, voluntarily making U.S. and foreign employees available for interviews, and collecting, analyzing, and organizing voluminous evidence for the department. Court filings also acknowledge the extensive anti-corruption remedial efforts undertaken by HP Co., including taking appropriate disciplinary action against culpable employees, and enhancing HP Co.’s internal accounting, reporting, and compliance functions.
The Federal Housing Finance Agency (FHFA), as conservator of Fannie Mae and Freddie Mac announced a settlement of $550 million with HSBC North America Holdings Inc., related companies and specifically named individuals (HSBC).
The settlement resolves claims in the lawsuit FHFA v. HSBC North America Holdings Inc., et al. (S.D.N.Y.), alleging violations of federal, Virginia and District of Columbia securities laws in connection with private-label mortgage-backed securities purchased by Fannie Mae and Freddie Mac during 2005-2007. Pursuant to the agreement, HSBC will pay $374 million to Freddie Mac and $176 million to Fannie Mae.
Only two of the 18 lawsuits FHFA filed in 2011 have not been resolved. FHFA continues to pursue a satisfactory resolution of these actions.
Monday, September 15, 2014
According to the Wall Street Journal and here, "Nearly 1,000 law enforcement agents conducted a raid that netted $90 million in cartel money, authorities said; one official said Los Angeles is the epicenter of drug-cartel money laundering."
"The case follows a recent advisory from the U.S. Financial Crimes Enforcement Network, or Fincen, to financial institutions about trade-based money laundering from Mexico, as well as Fincen’s first ever memorandum of understanding, which was with Mexico, to exchange financial information to fight drug crime."
NY Post article: Washington’s war on the tiniest regulatory violations — modeled after the New York Police Department’s “broken windows” policy — is drawing criticism from top investors, including Dallas Mavericks boss Mark Cuban, and former regulators who think that the SEC head is going too far.
Mark Cuban vlog:
In this edition of Monday Morning Headlines from World Risk and Insurance News
Several insurers join push for TRIA reauthorization."Without the backstop that TRIA provides, the private insurance market would simply be unable to provide adequate levels of terrorism risk insurance," according to the letter.
Reinsurers must innovate to see off threat from Google, says S&P. "For smaller, more concentrated reinsurers it's not the end of the road, but they will need to carve out competitive positions and protect their capital and bottom lines — and that is increasingly difficult in the current marketplace."
Even for those who are able to navigate the current cycle, there is no easy road ahead. S&P believes the reinsurance industry "must lead from the front, or get left behind" if it is to capitalize on opportunities to grow with the global economy.
My personal pick outlines core questions of fiduciary law theory Introduction to Philosophical Foundations of Fiduciary Law Andrew S. Gold and Paul B.Miller, DePaul University - College of Law and McGill University Faculty of Law
|1||2,901||'Competitiveness' Has Nothing to Do With It
Edward D. Kleinbard
USC Gould School of Law
Date posted to database: 7 Aug 2014
Last Revised: 11 Sep 2014
|2||117||Intellectual Property Securitization
Dov Solomon and Miriam Bitton
College of Law and Business - Ramat Gan Law School and Bar-Ilan University - Faculty of Law
Date posted to database: 5 Jul 2014
Last Revised: 5 Jul 2014
|3||79||A Critical Evaluation of Bail-Ins as Bank Recapitalisation Mechanisms
Charles Goodhart and Emilios Avgouleas
London School of Economics & Political Science (LSE) - Financial Markets Group and University of Edinburgh - School of Law
Date posted to database: 12 Aug 2014
Last Revised: 12 Aug 2014
|4||66||Crowdfunding 6.0: Does the SEC's FinTechLaw Failure Reveal the Agency’s True Mission to Protect — Solely Accredited — Investors?
David Groshoff, Kurtis R. Urien and Alex Nguyen
Western State University College of Law, Western State College of Law and Western State College of Law
Date posted to database: 20 Aug 2014
Last Revised: 20 Aug 2014
|5||64||Radical Shareholder Primacy
Washington and Lee University - School of Law
Date posted to database: 29 Jul 2014
Last Revised: 14 Aug 2014
Sunday, September 14, 2014
Taxpayers Recover $218.7 Million From First Ally Trading Plan; Treasury Launches Second Plan to Sell Additional Ally Common Stock
The U.S. Department of the Treasury today announced the completion of the first pre-defined written trading plan for Ally Financial Inc. (“Ally”) common stock.
Treasury sold 8,890,000 shares and recovered approximately $218.7 million for taxpayers. With the conclusion of the first trading plan, Treasury now holds 66.2 million shares of common stock, or approximately 13.8 percent, of Ally. Treasury also announced that it would continue to sell Ally common stock through a second pre-defined written trading plan.
Saturday, September 13, 2014
How innovative is the education sector? - OECD (2014).
The public sector, including education, is often perceived as reluctant to change and disinclined to innovate. We define innovation as the introduction of “new or significantly improved products, processes, organisation or marketing methods” (OECD/Eurostat, 2005). As they are in “non-competitive” markets, public sector organisations do not face the same pressure as the private sector to innovate and improve efficiency. But what does the evidence say ?
The REFLEX (Research into Employment and professional Flexibility) and HEGESCO (Higher Education as a Generator of Strategic Competences) surveys asked higher education graduates five years after graduation to report on their job characteristics, as well as their own and their organisation’s levels of innovation. They allow one to answer questions such as: how does education compare to industries more commonly associated with innovation such as manufacturing? How does the level of innovation in education compare to that of other public sector domains? What kind of innovation does the education sector mainly generate?
- New indicators on private institutions, on what it takes to become a teacher, and on the availability of, and participation in, professional development activities for teachers.
- Data from the 2012 Survey of Adult Skills, on attainment, employment, intergenerational education mobility, earnings, and social outcomes related to skills proficiency.
- Data from the 2013 OECD Teaching and Learning International Survey (TALIS) and the 2012 OECD Programme for International Student Assessment (PISA) in several indicators.
- Analysis of the impact of the recent economic crisis on the interplay among educational attainment, employment, earnings and public finance.
- More in-depth information related to upper secondary completion rates and the types and use of student loans.
- For the first time, data from Colombia and Latvia.
Friday, September 12, 2014
Credit Agricole SA will probably reach an accord with U.S. officials in the next two months to settle a probe of the bank’s business in sanctioned countries including Iran, a person with knowledge of the matter said.
A resolution is expected to follow a settlement with Commerzbank AG, which is in discussions with U.S. authorities to pay about $650 million for breaking trade embargoes, the person said.
The PLS market, like all markets, cycles from greed to fear, from boom to bust. The mortgage market is still in the fear part of the cycle and recent government interventions in it have, undoubtedly, added to that fear. In recent days, there has been a lot of industry pushback against the government’s approach, including threats to pull out of various sectors. But the government should not chart its course based on today’s news reports. Rather, it should identify fundamentals and stick to them. In particular, its regulatory approach should reflect an attempt to align incentives of market actors with government policies regarding appropriate underwriting and sustainable access to credit. The market will adapt to these constraints. These constraints should then help the market remain healthy throughout the entire business cycle.
"Sovereign Debt Crises"
Oxford Handbook of Banking, Forthcoming
FRB International Finance Discussion Paper No. 1104
Sovereign debt crises have been recurrent events over the past two centuries. In recent years, the timing of sovereign crises has coincided or has directly followed banking crises. The link between sovereigns and banks tightened as the contingent liability that the banking sector represents for the sovereign grew, as financial “safety nets” became more common. This chapter analyzes the transmission channels between sovereigns and banks, with a focus on the effect of sovereign distress on bank solvency and financing. It then highlights the notable cost to the real economy of the close connection between sovereigns and banks. Breaking the “feedback loop” between these two sectors should be an important policy priority.
Thursday, September 11, 2014
While White has said that the agency will make a “threshold decision” this year on whether, and how, to move forward with a uniform fiduciary standard rule for brokers and advisors, such a rule is not mandated by Dodd-Frank.
The SEC is focusing the “balance of this year” on completing rulemakings under Title VII of Dodd-Frank, which requires creating a framework for the regulation of swap markets, as well as rules regarding executive compensation, White told the lawmakers.
- The Honorable Daniel K. Tarullo [view testimony]
Board of Governors of the Federal Reserve System
- The Honorable Martin J. Gruenberg [view testimony]
Federal Deposit Insurance Corporation
- The Honorable Thomas J. Curry [view testimony]
Comptroller of the Currency
Office of the Comptroller of the Currency
- The Honorable Richard Cordray [view testimony]
Consumer Financial Protection Bureau
- The Honorable Mary Jo White [view testimony]
Securities and Exchange Commission
- The Honorable Timothy G. Massad [view testimony]
U.S. Commodity Futures Trading Commission.