US President Donald Trump will sign an executive order to unravel parts of the Dodd-Frank Act on Friday, according to Gary Cohn, director of the White House’s National Economic Council.
“This is a table setter for a bunch of stuff that is coming,” Cohn, a former Goldman Sachs executive, said in an interview with the Wall Street Journal.
Trump, who labelled the law a “disaster,” said earlier in the week that “we’re going to be doing a big number on Dodd-Frank.”
House Financial Services Committee chairman Jeb Hensarling previously told CNBC’s Final Bell dismantling the act was a first year priority, but it wouldn’t be tackled in the first 100 days.
While the orders signal the president’s priorities, only Congress can make major revisions to the act. Republicans argue the law has constricted banks’ ability to do business, but Democrats view it as the backbone of financial stability and consumer protection.
The Financial Choice Act, which was approved by the House Financial Services Committee last year, would serve as a replacement to Dodd-Frank and reduce regulatory oversight over the private equity industry. It would scrap the Volcker Rule, a Dodd-Frank provision which states banks may only hold 3 percent of their tier 1 capital in private investments.
On Thursday, Congressman Sean Duffy said the Financial Choice Act is expected to be introduced by House Republicans in mid-February, and reach the floor by spring. According to Congressman Hensarling, who introduced the legislation, the act is expected to see “modest changes” before then.
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