Leading Financial Oversight Groups Support Rep. Schiff's Bill to Regulate “Revolving Door” in Financial Services Industry
Washington, D.C.— Recently, Representative Adam Schiff (D-Calif.) released The Financial Regulators Revolving Door Enforcement Act, a bill to significantly enhance the integrity of financial regulation in the United States.
To read more about Rep. Schiff’s Financial Regulators Revolving Door Enforcement Act, click HERE.
See what leading groups are saying about Rep. Schiff’s bill:
"The revolving door of employees moving from banks and private financial institutions into the role of governmental financial regulators and back again is a pernicious problem. It often makes it difficult to distinguish whose interests they are serving, their private employers with lucrative prospects for financial gain or the public's interest. Rep. Schiff's "Financial Regulators Revolving Door Enforcement Act" would strengthen the conflict of interest barriers between private gain and government service in the financial industry," said Craig Holman, Ph.D., Public Citizen.
“The least the American people deserve is certainty that government officials are acting in the public interest and not for their own personal financial gain or to boost the profits of Wall Street,” “We applaud Rep. Schiff for introducing a bill that would help provide this certainty by creating robust rules to crack down on the corrosive effects of the revolving door between banks and other financial institutions and the government agencies that are supposed to regulate that industry. POGO is glad to endorse the Financial Regulators Revolving Door Enforcement Act and we call on congressional leadership to move swiftly to enact this legislation,” said Dylan Hedtler-Gaudette, Senior Government Affairs Manager at the Project On Government Oversight.
Specifically, the Financial Regulators Revolving Door Enforcement Act would:
- Extend existing federal 12-month post-employment restrictions, or “cooling off periods”, to 2-year waiting periods for senior banking employees and high-ranking financial services regulators moving between roles, including agencies such as Securities and Exchange Commission (SEC), the Federal Deposit Insurance Corporation (FDIC), the Office of the Comptroller of the Currency (OCC), and the Consumer Financial Protection Bureau (CFPB).
- Strengthen restrictions on contact with previous employers or clients by former agency employees and bans on taking official actions that directly and substantially benefit their former employer or clients.
- Enhance transparency by requiring post-employment disclosures for previous agency employees accepting senior positions for a financial service corporation they previously regulated.
- Establish mandatory ethics training for employees at financial sector regulatory agencies that emphasize avoiding conflicts of interest, adhering to the highest ethical standards, and maintaining protections for whistleblowers who report potential violations.
- Align penalties for these violations with existing law governing post-employment restrictions on former officers and government employees.
To read the full bill text, click HERE.
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