Politics

Conference committee members seek loopholes, receive high percentage of finance contributions

By Paul Blumenthal

Four key lawmakers on the financial reform conference committee are seeking to create loopholes in the so-called Volcker Rule and the derivatives section of the bill, according to Talking Points Memo.

The four lawmakers are Reps. Luis Gutierrez, Greg Meeks, Dennis Moore and Mel Watt. They have received a combined $5.5 million from the finance, insurance and real estate sector (FIRE) over their careers. All but Gutierrez received over 20% of their total career campaign contributions from the finance, insurance and real estate sector making them heavily reliant on the industry to fund their campaigns. Gutierrez received 19% of his contributions from the finance sector.

The loopholes that would be created are being suggested in a letter sent by the 68 members of the New Democrat Coalition, a group of moderate Democrats who have opposed many of the tougher regulations proposed for derivatives trading. TPM obtained a draft of the letter, which can be viewed here.

Meeks and Moore are both members of the New Democrat Coalition.  The Hill reported earlier this week that the New Democrats are drafting a letter urging the conference committee to drop a provision proposed by Sen. Blanche Lincoln requiring banks to spin off their derivatives trading desks into separate units.

During debate in the House over financial reform in 2009 the New Democrats played a key role in exempting a wide-swath of end-users from derivatives trading oversight and limiting the number of trades that will occur on an open clearinghouse.

Full post as published by Sunlight Foundation on June 17, 2010 (boomark / email).