Treasury Secretary Henry Paulson recently released his much awaited report, Blueprint for a Modernized Financial Regulatory Structure. The Paulson report contains a set of proposals that, taken together and if adopted, would constitute the most comprehensive restructuring of the US system of financial institution regulation and financial market oversight since the Great Depression. Among the highlights are proposals that would expand greatly the Federal Reserve's authority; concentrate insurance industry regulation in a new federal agency, the Office of Insurance Oversight; increase the responsibilities of the Office of the Comptroller to include regulation of thrifts and eliminate the Office of Thrift Supervision; merge the Securities and Exchange Commission and the Commodity Futures Trading Commission; and add a new regulatory entity, the Business Conduct Regulator, to oversee business conduct and consumer protection. This new regulator would also oversee the safety and soundness of most of the major participants in the US capital markets. Paulson's plan also would ask Congress to establish a federal Mortgage Origination Commission that would recommend licensing standards for mortgage brokers.
April 30 2008
