Statement of Bartlett Naylor, Financial Policy Advocate, Public Citizen
Note: The Federal Deposit Insurance Corporation (FDIC), the U.S. Office of the Comptroller of the Currency, the Federal Reserve, the U.S. Commodity Futures Trading Commission and the U.S. Securities and Exchange Commission today weakened the Volcker Rule, authorizing banks to invest in venture funds, which are high-risk investment pools for unproven enterprises. The Volcker Rule, part of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, was conceived by the late Federal Reserve Chair Paul Volcker to prevent another financial crisis exacerbated by irresponsible risk-taking at banks. Under the rule, banks can facilitate trades for clients but are not allowed to make bets with depositors’ funds.
This is no longer the Volcker Rule. In the hands of revolving door regulators, it turns banks into Trump casinos. Will the inevitable Trump casino bankruptcy be far away?