The head of a key banking panel on Monday released a draft bill of sweeping regulatory changes aimed at warding off future collapses in the financial system.
The bill put forth by Senate Banking Committee chairman Christopher Dodd, D-Conn., would create a new consumer regulator housed inside the Federal Reserve aimed at ensuring consumers get a fair shake with mortgages and credit cards. It will also push banks and financial firms to strengthen capital cushions and create a new process to take down giant failing companies and prevent future Wall Street bailouts.
The bill also would include the controversial rule proposed by former Fed chairman Paul Volcker and heralded by President Obama to prohibit financial firms from owning hedge funds or from proprietary trading on their own accounts.
Dodd wants to push the bill through his committee next week, to ensure it gets to the Senate floor before the summer, because midterm elections could complicate getting a final agreement. The House passed a version of regulatory reform in December.
Last week, Dodd broke off negotiations with Republicans, led by Sen. Bob Corker of Tennessee, who are now pledging to vote against the bill and to slow its momentum. The Republicans say Dodd's timetable doesn't give them enough time to digest the bill.