Eight state Attorneys General are joining a lawsuit challenging the constitutionality of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Dodd-Frank, which became law in 2010, aims to prevent another financial crisis and protect individual consumers from abusive financial products. Those certainly seem like good things and worthy objectives. The lawsuit, filed in June 2012, attacks several aspects of the law.
The lawsuit was filed in U.S. District Court for the District of Columbia by a group of Plaintiffs including the Competitive Enterprise Institute, a Washington-based nonprofit libertarian think tank. Three states – Oklahoma, South Carolina and Michigan – later joined the suit. The eight states now requesting to join are Alabama, Georgia, Kansas, Ohio, Nebraska, Montana, Texas and West Virginia.
It’s interesting that attacks on Dodd-Frank took place first in Congress and now in the courts. The powerful financial institutions don’t like this new law, but all consumers and investors need it and should resist any efforts to weaken the bureau. It will be interesting to see how the lawsuit plays out. It would be a tragic mistake to undo the progress that has been made in the ongoing battle to protect American consumers. The huge financial institutions have powerful lobbyists fighting for them. The playing field between Corporate America and consumers needs to be level and that is why it’s so important to defend Dodd-Frank and the consumer watchdog agency. If you agree, let your members of Congress know how you feel.
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