Academic journal article ABA Banking Journal

Required Reading: Tools to Help Cope with a New Law

Academic journal article ABA Banking Journal

Required Reading: Tools to Help Cope with a New Law

Article excerpt

Sometimes the government surprises us by cranking out a best seller, despite itself. The report of the 9-11 Commission is one example.

Somehow, we doubt the new Dodd-Frank Act will fall into that category. At 2,300 pages it dwarfs all previous banking legislation. But it's not the Act's length that will keep it from being a best-seller, at least from bankers' perspective, it's what's in it.

Take this passage from Title X, which sets up the Bureau of Consumer Financial Protection:

"Covered Persons will be required to make available to a consumer, upon request, information concerning the consumer financial product or service that the consumer obtained from the Covered Person, including information relating to any transaction, series of transactions, or to the account including costs, charges, and usage data, subject to the rules issued by the Bureau...."

That passage is from the ABA's summary and analysis of the bill, and is simplified from the legalese in the law proper. ("Covered Persons," by the way, means your bank, if it's covered by the new Bureau.)

That one sentence will prompt dozens of pages of regulatory requirements, which is why ABA estimates, conservatively, that Dodd-Frank in total will add 5,000 pages of new regulations for banks.

One of ABA's senior government relations staffers told us she was planning to spend the month of August meticulously going through all 2,300 pages of the Act. You probably don't want to do that. …

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