|
|
|
FDIC backs ban on banks trading for own profit
Top stories |
2011/10/11 09:32
|
Banks would be barred from trading for their own profit instead of their clients under a rule being proposed by federal regulators.
The Federal Deposit Insurance Corp. backed the draft rule on a 3-0 vote Tuesday. The ban on proprietary trading was required under last year's financial overhaul law.
For years, banks had bet on risky investments with their own money. But when those bets go bad and banks fail, taxpayers could be forced to bail them out. That's what happened during the 2008 financial crisis.
The Federal Reserve has also approved the draft of the so-called Volcker Rule, which was named after former Fed Chairman Paul Volcker.
The Securities and Exchange Commission and Treasury Department must still vote on it, and then the public has until January 13 to comment. The rule is expected to take effect next year after a final vote by all four regulators.
Congress and President Barack Obama had high hopes for the rule. But they left most of the details for regulators to sort out.
It's unclear how strictly the ban will be enforced. For example, it can be hard to tell whether an investment is intended to benefit a bank or its clients and whether federally insured deposits could be put at risk by these trades. |
|
|
|
|
Law Firm Web Design Information |
At Law Promo we know the legal field - we've been making websites exclusively for lawyers and law firms since 2004. This makes us one of the most experienced law firm web design agencies, providing our services to a thousand attorneys worldwide. Law Promo can construct your law firm a brand new responsive website, or help you redesign your existing site to secure your place in the mobile world. Law firm website design by Law Promo |
Lawyer & Law Firm Websites |
|
|
|
|
|