House sets vote next week on major financial regulation reform package

The House of Representatives is set to vote next week on a legislative package that would make significant changes to stock market regulations, bank rules, and other financial regulations.

The bill, the JOBS and Investor Confidence Act of 2018, was added to the House calendar for early next week Friday evening.

House Financial Services Committee Chairman Jeb Hensarling, R-Texas, has sought legislation to make it easier for companies to pursue initial public offerings and for investors to buy into start-ups, a JOBS Act 3.0 to follow on similar bipartisan measures that were enacted in the Obama years.

The measure set for consideration next week includes provisions along those lines, including making it easier for exchanges to trade shares in nonpublic companies.

It also, though, contains measures related to bank regulation. In that sense, the bill would add to the bipartisan regulatory relief package passed in the Senate this spring and signed into law by President Trump. In exchange for clearing that bill in the House, Hensarling was promised a follow-up Senate vote on a second package.

Most notably, the legislation scheduled for a vote next week would change the process for the “living wills” that banks are required to write explaining how they would safely go bankrupt, in case of a failure, without causing a panic. Those living wills would be required every two years, rather than annually as has been the case. The living wills are one of the major tools that the 2010 Dodd-Frank law provided to regulators to address the potential problem of “too big to fail” banks.

Another provision would protect banks that cooperate with law enforcement in tracking down money launderers. Today, banks can face penalties from regulators for running afoul of anti-money laundering rules if they keep suspicious accounts open at the request of law enforcement.

The bill also affects the insurance industry: One provision would place restrictions on international agreements relating to insurance, providing congressional review of actions regulators take.

Even Bitcoin is implicated in the legislation. It would require the Government Accountability Office to study how virtual currencies could be used to facilitate sex trafficking and drug dealing.

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