WASHINGTON (AP) — U.S. Treasury Secretary Scott Bessent is proposing to overhaul a regulatory panel that monitors the nation’s financial stability by advocating for looser regulations.
The Financial Stability Oversight Council is a U.S. agency established in the wake of the 2008 global financial crisis to monitor risks in the financial system and coordinate regulators’ approach to overseeing the U.S. financial system. In a letter released by Bessant on Thursday, he said “in the past, efforts to protect the financial system have often resulted in burdensome and often duplicative regulations.”
“Our government is changing that approach,” said Bessant, chairman of the committee, which will meet on Thursday.
Bessant said the committee would begin “considering which aspects of the U.S. financial regulatory framework create undue burdens and harm economic growth and, therefore, financial stability.”
Voting members of the FSOC Committee include the Chairman of the Board of Governors of the Federal Reserve; the Office of the Comptroller of the Currency; the Director of the Consumer Financial Protection Bureau; the Chairman of the Securities and Exchange Commission and several other agency heads.
It was established in 2010 under the Dodd-Frank Wall Street Reform and Consumer Protection Act, a sweeping U.S. financial reform law designed to prevent future economic collapse.
Sen. Elizabeth Warren, D-Mass., a critic of the Trump administration, harshly criticized the idea of loosening financial regulations, saying “taking such a hands-off approach to financial stability would expose our financial system and economy to greater risks in any economic environment.”
“It would be particularly reckless to go down this path at a time when cracks are appearing in the financial system and our economy is flashing a yellow light,” she said in a statement, citing the recent bankruptcies of subprime auto lender Tricolor Holdings, auto parts company First Brands and home improvement platform Renovo Home Partners.
