U.S. Senate Votes Down Broad Attack on State Enforcement of Wall Street Reforms

Statement of Diane E. Brown, Executive Director

Arizona PIRG

This afternoon, the U.S. Senate voted down a broad crippling amendment to the Wall Street Reform bill.  The amendment would have given the federal government sweeping ability to preempt or override states’ capacity to protect their own residents from dangerous and deceptive practices of banks and other financial institutions, while taking state Attorneys General off the corporate crime beat.  

Given that federal regulators completely failed to recognize lending problems that led to the economic meltdown, it is absolutely clear we need more cops on financial fraud beat.  The attack on stronger state laws and enforcement was one of most dangerous threats to the bill’s critical consumer protection provisions.

The U.S. Senate unfortunately did adopt a compromise amendment offered that preempts some state consumer laws but largely allows the state Attorneys General to enforce consumer protection laws.

After weeks of fending off attempts by Wall Street and the big banks to weaken and gut the Wall Street Reform bill, the time has come now for the U.S. Senate to vote for its final passage.

Arizona PIRG is scoring this and all important public interest amendments to the financial reform bill.