Thank you for contacting me regarding financial regulatory reform. I appreciate hearing your thoughts on this important issue. I greatly apologize for my delayed response.

The Restoring American Financial Stability Act of 2010 (H.R. 4173) passed in the House of Representatives on June 30, 2010 and in the Senate on July 15, 2010. It became law on July 21, 2010. The bill reforms the current financial regulatory structure into a more stable and transparent system that will protect consumers, provide clear and fair regulations for financial firms, and restore confidence in the financial markets.

The legislation creates a Systemic Risk Council and the Consumer Financial Protection Bureau (CFPB). The Systemic Risk Council will promote market discipline by identifying risks to stability in the financial market, including the ability to authorize the Federal Reserve to break up banks that threaten the stability of our financial system. The CFPB will enforce consumer protection regulations for banks, mortgage-related businesses, payday lenders and other non-bank financial institutions with more than $10 billion dollars in assets. The CFPB will also have the authority to write rules related to consumer financial products such as mortgages, credit cards, and stock options. In addition, the bill eliminates the risky trading that banks engage in, called proprietary trading, and authorizes the Federal Deposit Insurance Corporation (FDIC) to oversee the liquidation of failing non-banks that pose a risk to the financial system.

The financial crisis exposed critical gaps and weaknesses in our financial regulatory system. Massive risks in financial markets went undetected by both regulators and market participants. Even if those risks had been exposed earlier, regulators lacked the power to mount an effective response. These systematic failures caused a dramatic loss of confidence in our financial institutions and helped to cause the worst downturn since the Great Depression. Congress had to take action to ensure that American taxpayers will never again have to bail out our financial institutions and that these institutions treat consumers fairly and responsibly.

I supported this legislation because it embodies common sense financial reform that protects consumers, levels the playing field for community banks and provides fair and clear regulations for all financial institutions. North Carolina is a leader in the banking industry, and both our state’s banks and its banking customers will benefit from the financial reforms found in the law. The law will close gaps and eradicate inefficiencies in America’s current regulatory structure. I am proud to represent North Carolina in supporting legislation that works to ensure that American taxpayers will never again have to bear the cost of a financial crisis.