Dodd-Frank-Gesetz
The Dodd-Frank Wall Street Reform and Consumer Protection Act (commonly referred to as the “Dodd-Frank Act”) is a United States federal financial reform law enacted in response to the Great Recession of 2008. It was signed into law by President Barack Obama on July 21, 2010. The act established new rules for banks and other regulated financial institutions in an effort to prevent another global recession from occurring due to irresponsible banking practices or excessive risk taking.
The aim of this legislation is twofold: first, it seeks to protect consumers from predatory lending practices; second, it proposes regulations that will limit risky investments made by large financial firms like banks and hedge funds. To accomplish these objectives, the legislation has created several regulatory agencies tasked with overseeing various aspects of the U.S.’s economic system including mortgages, credit cards, derivatives trading and consumer protection laws. These government entities are responsible for ensuring compliance with all applicable rules and regulations as well as issuing appropriate fines when necessary violations occur.
In addition to creating these oversight bodies within U.S governmental departments such as Treasury Department’s Office of Financial Research (OFR), Consumer Financial Protection Bureau (CFPB) Securities Exchange Commission (SEC) Commodity Futures Trading Commission(CFTC), Federal Deposit Insurance Corporation FDIC , National Credit Union Administration NCUA etc.,the Dodd Frank also requires certain larger companies subjecting them more stringent capital requirements than smaller ones which helps reduce systemic risks across different sectors .It also provides assistance programs such as foreclosure relief through Home Affordable Modification Program HAMP ,Home Affordable Refinance Program HARP etc.. Furthermore enhanced disclosure standards have been mandated so investors can make better informed decisions about their investments while helping maintain a healthy competitive environment among market participants
Finally apart from providing greater transparency throughout entire industry the act generally tries promote long term growth stability build strong investor confidence create fair competition between players & ensure integrity markets thereby enhancing overall public welfare .
