Volcker Rule Rewrite Ignores Original Sin
June 5, 2018
Volcker Rule Rewrite Ignores Original Sin
Statements of Public Citizen Experts
Note: The U.S. Securities and Exchange Commission (SEC) today became the fifth agency to propose rollbacks to the Volcker Rule restrictions on bank proprietary trading. In his pushback on this proposal, Commissioner Robert Jackson highlighted the agency’s failure to finalize banker pay reform, contained in Section 956 of the same 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act that includes the Volcker Rule.
“Commissioner Jackson rightly identifies Washington’s inaction on banker pay reform as yet another reason a Volcker Rule rollback is nonsensical. Congress approved Dodd-Frank in 2010 and set a deadline for decoupling risky banker behavior from bonus pay by 2011. The SEC and other agencies are glaringly behind in the work to regulate excessive pay; and while risky activity can still garner massive incentive compensation, it is even more inappropriate to weaken the safeguards in the Volcker Rule.”
– Lisa Gilbert, vice president for legislative affairs
“It’s all too telling that President Donald Trump’s regulators are anxious to accommodate Wall Street’s frustrations with the rules on gambling but ignore their congressional mandate to reform Wall Street’s addiction to bonuses. The Volcker Rule restriction on gambling won’t work unless Washington reforms compensation incentives. Reform pay and Wall Street might find it surprisingly easy to comply with restrictions on gambling.”
– Bartlett Naylor, financial policy advocate, Public Citizen’s Congress Watch division
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