Tuesday, January 4, 2011
The Committee on Capital Markets Regulation (which prior to the financial crisis produced a white paper on financial reform) recently wrote(Download 2010.12.15_Rulemaking_Timeline_Letter) to Congressional leaders on the Senate Banking Committee and House Financial Services Committee to express concern over the pace of rulemaking under Dodd-Frank. It believes "there is an urgent need for [the] Committees to hold oversight hearings on the implementation through rulemaking of the Dodd-Frank legislation," because the current process is "sacrificing quality and fairness for apparent speed...."
The letter goes on to note that the SEC, which prior to the financial crisis averaged fewer than ten new rules a year, is required to issue approximately 100 new rules, of which about 60 must be written by July 2011; the CFTC, which issued a total of 12 new rules in the two years prior to the financial crisis, must issue nearly 40 by that date.
It concludes by warning that speed in rulemaking "may kill our economy by producing bad rules that interfere with the proper functioning of the financial system for years to come. The letter is signed by co-Chairs R. Glenn Hubbard and John L. Thornton and Director Hal S. Scott.