As Senate begins financial reform debate, industry spends tens of millions to influence debate

The Senate Banking Committee will take up legislation today sponsored by Sen. Chris Dodd (D-Conn.) to overhaul the nation’s financial regulations amidst record spending on lobbying fees and campaign contributions by the financial industry hoping to weaken or outright kill reform legislation, according to Americans for Financial Reform, Common Cause, Public Campaign and Public Citizen. Although the issue has been eclipsed by the high-profile health care reform effort, reform of financial regulations has drawn the same intense opposition from industry groups as health care.

Big banks and Wall Street financial firms, bailed out by taxpayers because of their own irresponsibility, have waged a fierce battle against the proposed Consumer Financial Protection Agency and other provisions that would increase transparency and oversight of the financial services industry. The failure of government regulators and the lack of accountability for different quarters of the financial sector are largely blamed for the meltdown on Wall Street that almost led to a second Great Depression.

Big banks and Wall Street financial firms have spent more than $500 million, or $1.4 million a day, since the beginning of last year in lobbying and campaign contributions, according to data from Center for Responsive Politics. Preventing stronger oversight and transparency in response to the financial crisis has been their number one legislative priority. (Learn more about banking industry lobbying against financial reform.)

As the legislation moves to the whole Senate, this coalition of groups will be tracking the payback to Wall Street and the big banks like Goldman Sachs and Bank of America, and their army of lobbyists walking the halls of Congress. Once on the floor, the Senate will likely consider numerous amendments on Sen. Dodd’s bill, many of which are designed to dilute or undercut the legislation which will strengthen oversight and increase transparency of the financial services industry. We will shed light on these backroom deals and welcome a public fight on this bill.