Senate Passes Historic Financial Reform 

On May 20th, the U.S. Senate passed the Restoring American Financial Stability Act, which includes a strong, independent Consumer Financial Protection Agency, opens up the shadow markets where derivatives are traded, and prevents banks from becoming ‘too big to fail.’”

MASSPIRG backed the legislation and successfully fought back several attempts to weaken it on the Senate floor. The bill now moves to a conference committee, where we will continue to work for the strongest possible consumer protections.

How did your Senator vote?

Both Senator Scott Brown and Senator John Kerry stood up against the big banks and voted in favor of the full bill.  However, we need to keep the pressure on them to make sure they push for the strongest reforms to come out of the House and Senate conference committee.

U.S. PIRG compiled a Senator Scorecard, which looks at ten key amendments and the final vote, and gives each Senator a final "public interest" grade.

Click here to go to the Senator Scorecard page

What Wall Street Reform Means to You

The historic Wall Street reform legislation passed by the Senate last night will have an impact on Main Street as well as Wall Street. The big banks will make every effort to dilute the bill in the House-Senate conference. Congress must assure that nothing is done to weaken the legislation, that the strongest provisions of each bill make it into the final version and that potential loopholes are closed.

Here are the key provisions that will provide all Americans with economic stability.

• Real consumer protection: independent from the biggest banks that have put their profits ahead of us. Now credit cards and mortgages will offer terms in language we can all understand.  It will also offer help for those abused by predatory lenders.

• Mortgage reforms: For the first time lenders are prohibited from making loans that borrowers cannot repay, and banned from receiving kickbacks for steering people into high rate loans when they qualify for lower rates.

• Ending the casino economy and bringing sunlight to shadowy derivatives market: The $600 trillion derivatives market will now have the light of day shining on the market (with exchange trading) and be held accountable with capital requirements (with clearing).

• Putting the brakes on risky speculation to prevent future crises and tax payer bailouts: Unregulated shadow banks like AIG will face strict oversight for the first time and our biggest, riskiest banks will have tougher leverage and capital requirements. When a financial firm does run into trouble, it will face a new liquidation regime so that we don’t need to bail it out or prop it up—it will be put out of business.

• Strong investor protections: Enhanced shareholder rights will allow for a say on pay of executives and give long-term shareholders a meaningful voice in holding corporate directors accountable. Additionally credit ratings agencies will not be just the handmaidens of the biggest financial institutions. Better controls at rating agencies hold them accountable for the reliability of their reporting.