The Reform And Consumer Protection Act

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When the housing bubble has burst in both sides of the Atlantic in 2007, the regulatory system has failed not only to effectively manage the risk, but also to require sufficient transparency and emphasized the vital importance of a well-regulated financial system. As a response of the crisis, the United States launched the most powerful financial regulatory reform plan in the U.S. history since the 1930s: The Dodd-Frank Wall Street Reform and Consumer Protection Act (‘the Dodd-Frank Act’ or ‘the Act’). The new regulatory framework has reached to every corner of the financial sector, in order to reduce the risk and as a result to reduce systemic threats to the broader financial system. Under the Act, the role of the Federal Reserve has…show more content…
Banks, or depository institutions, may be chartered by either federal or state authorities. First of all, The OCC is an independent bureau of the U.S. Department of the Treasury, regulates, and supervises all national banks, federal savings associations as well as federal branches and agencies of foreign banks (Occ.gov, 2016). In the late 19th century and the early 20th century the United States suffered numerous downturns in economic activity and the federal government through the OCC did regulate many of the banks, but many were regulated only by the states, and many functions performed by Central Bank were not available, therefore, the Federal Reserve System (Fed) was established in 1913. The Fed was given regulatory power over all national banks and those state chartered banks which elected membership in the Fed (Barth, Li and Lu, 2009). Federal Deposit Insurance Corporation (FDIC)is also a federal bank regulator, which was founded in 1933, to provide insurance, inspection and supervision of financial institutions and to take over the collapse of institutions, to maintain the stability of the U.S. financial system and public confidence. In a word, all the banks in the United States are divided into federal bank (or national bank) and state bank. On the one hand, the establishment of the federal bank was taken charge and accepted by the OCC.
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