New leadership in Congress is preparing to take over in January, and the next Chairwoman of the House Financial Services Committee is putting big banks on notice.
California’s Democratic Rep. Maxine Waters, perhaps best known as the woman who called for supporters to harass Trump Administration officials at gas stations, will most likely replace current Texas Republican Rep. Jeb Hensarling to chair the committee responsible for overseeing the country’s largest financial institutions.
In the run-up to the takeover, Waters has pledged to put an end to the Trump Administration’s trend of removing Obama-era banking regulations.
“Make no mistake, come January, in this committee the days of this committee weakening regulations and putting our economy once again at risk of another financial crisis will come to an end,” Waters said during a meeting with Federal Reserve Vice Chairman Randal Quarles.
In addition to vowing an end to President Donald Trump’s laissez-faire approach to finance, the California Democrat also indicated that she will use her newfound power to investigate the president’s financial connections. This will reportedly include subpoenas on the Trump campaign’s alleged ties to Germany’s Deutsche Bank, which critics say helped finance the campaign with Russian government funds.
Rep. Waters’ statements will effectively mark a return to how the federal government approached banking in the immediate aftermath of 2008’s financial crisis. Since taking office, President Trump has overturned many of the regulations put in place in response, including provisions of the Dodd-Frank reforms.
“It is essential that the Fed keeps a watchful eye on the financial institutions it supervises and makes strong use of its existing enforcement tools to crank down on institutions that break the law,” Waters added. “I must say that I am concerned about proposals the Fed has put forth this year to reduce capital and liquidity requirements for the largest financial institutions which would weaken strong safeguards established by Dodd-Frank to protect the U.S. economy from another costly financial crisis.”
With Republicans still in control of the Senate, it remains to be seen just how far Rep. Waters will be able to go once she’s in control of the committee. The U.S. Senate has its own finance committee as well, and would theoretically be able to block or stall her actions.