Both Dodd and Frank Call on Admin to Use Powers of Dodd-Frank

DDay has a really important post that–along with a great interview with Brad Miller–includes a letter from Miller and other members of Congress, urging the Financial Stability Oversight Council to take action to prevent the foreclosure fraud problem from becoming a systemic crisis. The letter reminds the FSOC that Dodd-Frank gives them the power to avoid a systemic crisis.

An important purpose of the Dodd-Frank Act is to identify risks to the financial system as early as possible, so that regulators can take corrective action or minimize the disruption to the financial system that results from the insolvency of systemically significant financial companies. It is also a purpose of the Act to make risk to our nation’s financial system transparent in order to restore the confidence of the American people in the financial system and in their government.

And lists three things the FSOC should do to prevent the foreclosure fraud problem from becoming a systemic crisis:

  1. Examine a representative sample of loans to see whether they comply with legal requirements and pooling and servicing agreements.
  2. Determine whether the second liens servicers have on loans have led them to act contrary to the interests of the first lien holders.
  3. Require big banks to divest themselves of servicing businesses.

House Financial Services Committee Chair Barney Frank is one of the first ten people to sign this letter.

Put together with Senate Banking Committee Chair Chris Dodd’s call on Tim Geithner to consider how the FSOC can mitigate the risks of this crisis, you’ve got both Chairmen of the relevant committees urging the FSOC to do something about the potential systemic risk of this crisis. You’ve got Dodd and Frank, the two guys with their name on the financial reform bill, calling on the Administration to use the authority granted under Dodd-Frank to prevent another meltdown.

And thus far?

Crickets. From both the Administration and the media.

  1. b2020 says:

    So Dodd and Frank did the kabuki they figure will help with re-election and/or blamestorming, as the case may be, and the media and WH ignored them as expected, and we can continue business as usual.

    News reports should have to be flagged to indicate whether they refer to actions or speech. We have come full circle – first was the act, then there was the act of speaking, and now speech has replaced action. Low information voters would be assisted tremendously by avoiding any and all reporting on speech, and focusing on action and consequence. It’s not like the population at large would use any reporting of words (let alone conjectured intentions and agendas) to attempt to prevent undesirable action, so nothing is lost by ignoring the act – and acting – of speech.

  2. 1der says:

    Speeching of action as the White House pulls the Condi Rice defense – “No one could have predicted.” – and looks foolish.

    From the Miller interview:
    Q: Do you get the sense that Republicans are paying attention to this issue at all? What will they do with it in the majority?

    Rep. Miller: Blame borrowers. Or, I’m sure they’re going to find some way to argue that it’s all government’s fault, liberals’ fault. I’m sure they’re scrambling. They probably have a full team at AEI and Cato working on that now. They’ll have some experts with a complete explanation come January.

    The whiny Professional Left always with the “I told you so’s” doesn’t help with: Looking forward on the Good Bi-partisan Ship. Steering into the iceberg, pass out the life vests, Millionaires and Banksters first!

    • jerryy says:

      …”Now back to your regularly scheduled search for Obama’s spine.”

      Is finding it listed in The Hitchhiker’s Guide under recreational impossibilities?

    • lausunu says:

      OT for sure. From Bad Astronomy- Phil Plaitt

      We know planets can form around stars in other galaxies. And that means that when we broaden our view, look not out into the galaxy but out into the Universe, we can know that there are not just trillions of planets out there, but billions of trillions. Each galaxy we see may have trillions of planets, and there are hundreds of billions of galaxies in the Universe.

      Makes all the rest seem trivial and Kabuki-esque.

      For the record, I am for exoplanatory tax cuts for the rich. That should create some jobs. Actually not. Think of the mortgage fraud potential. It boggles the mind, should it be insufficiently boggled at the present moment.

  3. Kassandra says:

    The “media” will never address this. They are no longer part of the first alert system for the country. In fact, they will do everything to suppress it. After all, we ahv a Royal Wedding to watch now

  4. Cujo359 says:

    Question for the class: Are we seeing proof of the critics’ charge that Dodd-Frank wasn’t up to the job of preventing future fiscal disasters, or are we seeing proof that no legislation can work if it’s not enforced?

  5. jal says:

    They are being pressured to do the opposite by the republicans.

    What is needed is an opposing force, (bloggers) to write etc. to

    Andre Carson (IN)
    Stephen Lynch (MA)
    Joe Baca (CA)
    Jackie Speier (CA)
    Danny K. Davis (IL)
    Laura Richardson (CA)
    Barney Frank (MA)
    John Conyers (MI)
    Luis Gutierrez (IL)
    Maxine Waters (CA)


  6. wendydavis says:

    Shucks; I think you forgot to mention Senator Dodd also recommended another round of stress tests for the Big Honker Banks. That first round they all passed swimmingly? Seems they accidentally used software designed to check State Lottery Programs by mistake.

  7. timbo says:

    Hey, you know, the Obama administration doesn’t want to create a financial panic by actually investigating all the fraud occurring in those sectors…