The U.S. House of Representatives on Thursday approved legislation to repeal and replace major parts of the Dodd-Frank Wall Street reform law, as Republicans finally moved a step closer to delivering on their promise to reshape the regulatory landscape.
In a primarily partisan vote, the House passed the CHOICE act which stands for the Financial Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs Act. However, the measure faces uncertainty in the Senate as Democrats are broadly opposed to the legislation and their votes are needed to pass it. Further, a handful of Republican senators immediately rejected the bill, signaling that they would start work on a new version of the bill virtually from scratch.
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The new bill aims to loosen financial regulations by repealing large portions of the 2010 Dodd-Frank law. It also places new restrictions on the Consumer Financial Protection Bureau, bringing it under much stricter oversight by Congress, while eliminating powers granted to financial regulators after the 2007-09 financial crisis. These powers allow the nation’s watchdogs to wind down failing institutions, and allow banks to be exempted from many existing financial rules if they agree to significantly increase the amount of capital they hold.
“This is a jobs bill for Main Street. It will rein in the overreach of Dodd-Frank that has allowed the big banks to get bigger while small businesses have been unable to get the loans they need to succeed,” said Speaker Paul Ryan in a statement supporting the measure.