The Key Agencies that were born out of the Dodd Frank Compliance

When the economy experiences big bumps, the nation is deemed to fall especially when the structure of the economy includes big major financial institutions that can easily alter economic conditions in the event that they become too rigid and cannot be able adapt to pressure on regulations and economic hurdles. The fact that the existing economic environment heavily relies on these institutions make them too crucial to be neglected by the government, knowing that overlooking this aspect can easily put to compromise the fate of the country’s economy. In the US for example, the government has been keeping an eye on most of their key financial institutions in order to prevent the recurrence of the devastating financial crisis that shook the global economy in 2008. Today, the US government has been looking for ways to mitigate any growing economic problem and issues that could pose great threats to financial institutions. As an answer to this pressing dilemma, lawmakers from the US government drafted and passed the Dodd Frank Wall Street Reform and Protection Act in 2010. The Dodd Frank Compliance which got its name from the two key lawmakers who worked substantially on the regulation, US Senator Christopher J. Dodd and US Representative Barney Frank, was formulated primarily for the purpose of protecting the interests of financial institutions and their clients and to safeguard the status of the US economy as a whole. With its legal power, Dodd Frank Compliance spurred the creation of three government agencies, each playing crucial roles in the successful enforcement of the act.

The first agency that was sprung under the implementation of Dodd Frank Compliance is Financial Stability Oversight Council and Orderly Liquidation Policy. This agency is primarily responsible for ensuring the stability of big companies by preventing them from ending in a sudden collapse by helping them liquidate the business orderly and smoothly with the aid of the Orderly Liquidation Fund set up for all institutions covered by Dodd Frank Compliance.

Dodd Frank Compliance also initiated the creation of Consumer Financial Protection Bureau which is seen as the solution to most aggressive lending arrangements which affects consumers the most. Through Dodd Frank Compliance and CFPB, mortgages are mandated to provide clearer understanding to benefit most consumers and mortgage brokers are discouraged from setting too high mortgage rates. Even credit card companies are also monitored by the CFPB to ensure that all of their users understand completely the terms and agreements set out on their card usage.