Some U.S. regulators are “paralyzed” by the threat of lawsuits from Wall Street firms seeking to slow or stop the rollout of rules that would crimp their bottom line, a top U.S. official said on Thursday.
Bart Chilton, a Democratic commissioner at the Commodity Futures Trading Commission, said if regulators live in fear of a lawsuit alleging they failed to consider sufficiently the costs and benefits of a rule, rulemaking slows or halts and opponents have succeeded.
Regulators, already months behind in implementing rules from the Dodd-Frank financial reform law passed in 2010, are bracing for additional legal challenges as more regulations are completed.
Insufficient or flawed analysis of the costs of a rule versus the benefits to the public or industry likely will be a reason cited in lawsuits seeking to overturn the measures.
“Sure, people have the right to go to court and challenge things,” Chilton said at a financial conference in New York.
“But regulators need to keep our eye on the ball and not be scared into making rules and regulations weak or ineffective because we are overly concerned about what we call ‘litigation risk’,” he said, according to the text of his speech.
Chilton said the CFTC follows the proper requirements for assessing the cost-benefit analysis (CBA). The agency puts out a proposal, asks for comments and what the cost might be. In some cases, the agency either is not provided with the costs of the regulation or the comments have no use.
“Those who criticize our CBAs should be required to provide … real, verifiable dollars and cents to rebut our analyses,” he said.
Read more here
No comments:
Post a Comment