March 30, 2016
Disappointing Ruling: U.S. District Court Removes MetLife’s Too-Big-To-Fail Label
Statement of Bartlett Naylor, Financial Policy Advocate, Public Citizen’s Congress Watch Division
Note: Today, a District of Columbia federal judge ruled that insurance giant MetLife will no longer be classified as a too-big-to-fail institution and should not be subjected to stricter oversight. In a sealed decision (PDF), the judge rescinded the Financial Stability Oversight Council’s designation of MetLife as a Systemically Important Financial Institution.
Public Citizen is dismayed not only by the decision to remove MetLife’s too-big-to-fail label but also by the lack of transparency with today’s sealed decision.
In the wake of the 2008 financial crisis, Congress directed regulators to identify large firms whose demise could threaten systemic economic instability. Today’s decision has removed those guardrails from one of the largest insurance companies on the planet.
Because the decision is sealed, we are unable to see the details. It is difficult to envision a world where the failure of an $877 billion institution like MetLife, which is larger than Lehman Brothers, would not have devastating repercussions to the economy.
We ask the court to unseal this decision and allow sunlight into the regulators’ designation process and the judge’s reasoning.