U.S. Treasury Secretary Scott Bessent is proposing to overhaul a regulatory panel that monitors the nation's financial stability, by advocating for looser regulations.
The Financial Stability Oversight Council, a U.S. body created in the wake of the 2008 global financial crisis, monitors risks to the financial system and coordinates regulators' approaches to overseeing the U.S. financial system. In a letter released by Bessent Thursday, he said “too often in the past, efforts to safeguard the financial system have resulted in burdensome and often duplicative regulations."
“Our administration is changing that approach," said Bessent, who chairs the committee, which is meeting on Thursday.
Bessent said the council will begin to "consider where aspects of the U.S. financial regulatory framework impose undue burdens and where they harm economic growth, thereby undermining financial stability.”
Voting members of the FSOC committee include the head of the Board of Governors of the Federal Reserve System; the Comptroller of the Currency; the director of the Consumer Financial Protection Bureau; the chairman of the Securities and Exchange Commission and several other agency heads.
It was established in 2010 by the Dodd-Frank Wall Street Reform and Consumer Protection Act, a sweeping U.S. financial reform law created to prevent future economic meltdowns.
A critic of the Trump administration, Sen. Elizabeth Warren, D-Mass., panned the idea of loosening financial regulations, saying “taking this hands-off approach to financial stability would leave our financial system and economy at greater risk in any economic environment.”
“Going down this path just as cracks are emerging in the financial system and yellow lights are flashing across our economy is especially reckless," she said in a statement, citing the recent bankruptcies of subprime auto lender Tricolor Holdings, auto parts company First Brands, and home remodeling platform Renovo Home Partners.
