Financial services regulatory reform bill heads to Senate

WASHINGTON—A financial services regulatory reform bill will reach the Senate floor soon, the chairman of the Senate Banking, Housing and Urban Affairs Committee told his colleagues Wednesday.

In an often impassioned speech, Sen. Chris Dodd, D-Conn., accused Republicans of falsely arguing that the Restoring American Financial Stability Act of 2010 would continue the bailing out financial institutions.

“This bill, as drafted, ends bailouts,” Sen. Dodd. “For the first time, our country will have someone with the job of monitoring risks to the financial system and sounding the alarm before these risks can take down the system. And the bill imposes tough standards on Wall Street firms that create those risks.

“If a Wall Street firm does become too big or too complex and poses a grave threat to financial stability, the Federal Reserve will have the power to restrict its risky activities, restrict its growth and even break it up,” he said. “Additionally, our bill extends oversight to dangerous nonbank financial companies like (American International Group Inc.) that could pose a risk to our financial stability,” he added.

The “bill will be before us in a few short days,” Sen. Dodd said.

The House passed its own version of financial services regulatory reform in December.