Tag: Dodd-Frank Act

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Garrett Continues to Push for Transparency in the Murky World of Financial Regulation

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file photo Scott Garrett sinking the crony driven Ex Im bank

Garrett Statement on SIFI Designation Struck Down by Courts

Mar 30, 2016
the staff of the Ridgewood blog

Ridgewood NJ,  Rep. Scott Garrett (NJ-05), Chairman of the Financial Services Subcommittee on Capital Markets and Government-Sponsored Enterprises, issued the following statement after a federal judge struck down a systemically important financial institution (SIFI) designation by the Financial Stability Oversight Council for the first time ever today.

“FSOC’s ( Financial Stability Oversight Council ) perfect storm of secrecy and intimidation has created a shadow regulatory system that concentrates power in Washington at the expense of hardworking Americans, and I’m pleased to see the judicial branch took a stand for the Constitution with their decision.  Now that the courts have spoken, it’s time for Congress to step in and pull back the curtain on FSOC so the American people can see what this secretive body is really up to.”

Garrett has led the call for much-needed transparency and accountability at the FSOC. He is the author of H.R. 3557, the Financial Stability Oversight Council (FSOC) Transparency and Accountability Act. This bill passed the Financial Services Committee in November.

H.R. 3557 would:

  • Subject the FSOC to the Government in the Sunshine Act
  • Subject the FSOC to the Federal Advisory Committee Act
  • At all FSOC meetings, allow for the participation of all members of the Commissions and Boards represented
  • Require that any vote taken by the principal of a Commission or Board represented must first be taken by that Commission or Board and the principal must then in turn vote that same decision at the Council
  • Allow for Members of Congress on the Congressional oversight committees of FSOC to be able to attend all FSOC meetings

Garrett has made enemies by his unrelenting disapproval of Dodd-Frank which has codified the disastrous “too big to fail” policy  and mega Wall Street bail outs . “Garrett says , “the Dodd-Frank Act has stifled economic growth, made it more difficult for Main Street businesses to obtain credit, and increased the likelihood that taxpayers will be on the hook for additional Wall Street bailouts. Most importantly, this law has and has made it harder for Americans to find a job, buy a home, and save money for their family’s future. ” Garrett went on , “Despite creating new bureaucracies that have imposed thousands of pages of rigid, invasive, and unworkable regulations, Dodd-Frank did nothing to reform the mortgage giants Fannie Mae and Freddie Mac, whose actions caused the 2008 financial crisis.

While Garrett’s Democrat challenger Josh Gottheimer is a champion of more big government , more corporate welfare ,and more wall street bailouts.

 

 

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Garrett Fights to Restore Due Process Rights for All American Investors

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Scott Garrett with Franklin Lakes residents at their annual town fair.
Oct 22, 2015
the staff of the Ridgewood blog

WASHINGTON, D.C. – Rep. Scott Garrett (NJ-05), Chairman of the Financial Services Subcommittee on Capital Markets and Government-Sponsored Enterprises, today introduced H.R. 3798, the Due Process Restoration Act. This legislation will rein-in the Securities and Exchange Commission’s (SEC) controversial overuse of in-house administrative law judges (ALJs) and ensure that all Americans are given due process by allowing defendants the option of having their case heard before a federal court.

“Strong enforcement of the securities laws is an essential part of the SEC’s mission to protect investors and maintain a fair and efficient marketplace, but in recent years the agency has transformed into a veritable judge, jury, and executioner with its blatant overuse of their in-house courts,” said Garrett. “Every American has the constitutional right to defend themselves before a fair and impartial court, and the Due Process Restoration Act will go a long way towards protecting the rights of the innocent while maintaining the ability of the SEC to punish wrongdoers.”

The Due Process Restoration Act will:

Provide a mandatory right of removal allowing the defendant to request that the case be moved to a district court
Grant a right of removal to defendants who are subject to a cease and desist order and monetary penalty that the commission is seeking
Raise the burden of proof for cases that remain in the ALJ to a higher “clear and convincing evidence” standard

Background:

In the wake of the 2010 Dodd-Frank Act, which granted the SEC expanded administrative enforcement powers, the SEC started trying an increasing number of alleged wrongdoers before its in-house administrative panels rather than in the federal courts established by Article III of the Constitution.

The Wall Street Journal reported that from October 2010 through March of this year, the SEC won 90 percent of cases that came before SEC judges.  In contrast, the SEC achieved less than a 70 percent outcome when the case is held in federal court. In addition to its success rate, the overall number of cases before the Commission’s in-house panels has increased nearly 75 percent over the past ten years.

The SEC has heard repeated criticism of these in-house panels from defendants who feel they weren’t given due process, former SEC judges who felt pressure to rule in favor of the Commission, and U.S. District Judges who find the panels unconstitutional.

The Commission recently announced that it will be giving more legal safeguards to defendants that come before its in-house administrative panels. Unfortunately, the SEC’s proposed changes fall well short of addressing many of these concerns and its enforcement practices continue to violate the separation of powers guaranteed by the Constitution.