Verret on Leaving the Details to Regulators
While it is common for Congress to pass legislation without regulatory details, Professor J.W. Verret says in the case of the financial overhaul bill passed last week, "open-ended authorizing legislation was passed at a more rapid rate than we've ever seen before."
Designed to provide greater oversight of operations on Wall Street, the nearly 2,000 page bill contains close to 400 instances where regulators will need to fill in the blanks regarding implementation of the law.
Once the president signs a bill, federal agencies typically submit proposed rules, which subsequently go through public review before being finalized and adopted. The financial reform bill may take as long as several years to become fully implemented.
Finance Reform Bill Leaves Much Detail for Later, Associated Press via ABC News, June 25, 2010. By Eileen Aj.
"Among the numerous details still to be ironed out: how mortgages will be overseen by the new Consumer Financial Protection Bureau and how the Securities and Exchange Commission will oversee credit rating agencies.
"The lack of hard-and-fast specifics may be one reason investors had a muted response to the bill: the major Wall Street indexes barely budged Friday, and bank and insurance stocks mostly rose on the day.