“Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs” – House Passes Financial Reform Bill

If passed and signed into law, the bill would relax Dodd-Frank capital requirements, scale back the authority of the Consumer Financial Protection Bureau and repeal the Volcker Rule, which limits the ability of banks to engage in proprietary trading.       

The bill would also have an important impact on corporate governance and executive compensation disclosures and practices.  In particular, the Financial CHOICE Act would repeal the requirement to provide executive officer pay ratio disclosures, would limit the requirement to hold regular Say on Pay votes to years “in which there has been a material change to the compensation of executives” and would substantially limit the application of the SEC’s pending clawback rule.

Although the Financial CHOICE Act is not expected to pass the Senate, the proposals advanced by the bill warrant careful consideration.  In fact, the Senate is positioned to advance its own financial reform legislation and may draw from some of the provisions contained in the Financial CHOICE Act.