Oregon treasurer, Merkley blast Trump bank-reform moves

An Oregon senator and the state treasurer issued sharply critical statements Friday after President Trump announced a review of federal banking reforms and delayed a planned rule change the Obama administration crafted to require that financial advisors and brokers act in their clients’ best interests when dealing with retirement accounts.

The regulation, which was to begin being implemented on April 10, would have affected only investors’ retirement accounts.

State Treasurer Tobias Read, a Democrat elected last fall said the announced intent to retreat from the U.S. Department of Labor’s fiduciary rule “would put at risk the long-term financial health of Oregonians who make investing decisions through financial advisors.”

Read called it “reckless and outrageous” to retreat from imposing the fiduciary rule, which would require investment professionals to give advice that is in the best financial interest of their clients – as opposed to themselves.

“The fiduciary rule protects the public, plain and simple,” Read said. “I am aghast that the Trump administration and the Republican Congress are choosing Wall Street profits over the financial health of hard working Oregon families.”

Many investment professionals are fiduciaries and protect their clients’ best interests, Read said, and that should be the minimum standard for everyone in the industry.

“We want Oregonians to be able to invest in themselves with confidence, for their long-term financial well-being,” he said.

Trump ordered reviews of major banking rules put in place after the 2008 financial crisis, a move that drew fire from Democrats who said his order lacked details but squarely aligned him with Wall Street bankers.

Though the order lacked specifics, financial markets embraced Trump’s signal that looser banking regulation is coming and pushed bank stocks higher.

At a White House forum on Friday with U.S. business leaders, Trump said his administration expects “to be cutting a lot out of Dodd-Frank.”

That will involve a lot more than issuing an order, said former Democratic congressman Barney Frank, co-author of the 2010 Dodd-Frank Wall Street reform law that raised capital requirements for banks, restricted their trading by means of the “Volcker Rule,” and created the Consumer Financial Protection Bureau to guard against predatory lending.

Sen. Jeff Merkley, D-Ore., attacked the president’s plan to “gut Wall Street oversight by rolling back key pieces of the reforms that were put in place following the 2008 financial crisis:”

“Eight years ago, following a decade of predatory home-lending and risky derivative-trading practices by big banks, we witnessed the greatest financial crisis since the Great Depression. We experienced firsthand the negative consequences of the Wall Street Casino: our economy plummeted and too many middle-class families suffered.

“We have spent the last eight years digging out of that hole, and now is not the time to be relaxing the rules for Wall Street. Unfortunately, the Trump plan ignores this reality. It is an industry wish list that will help Wall Street at the expense of working families.

“Gutting Wall Street reform would make it easier for banks to once again make predatory home loans. And by attacking the Volcker Rule, it would undoubtedly bring us back to the days of taxpayer-insured hedge funds.

“We must not allow Wall Street banks to once again strip wealth from middle-class families. Trump’s supporters did not vote to hand the keys of the economy back to Wall Street. If the Trump administration tries to proceed with any plan that does Wall Street’s bidding at the expense of working families, I will fight it tooth and nail,” Merkley concluded.