By Sarah Borchersen-Keto, CCH Washington News Bureau, Contributing Author, the CCH Federal Banking Law Reporter, June 6, 2011.
Treasury Secretary Tim Geithner warned the financial community that it is in their own best interest to ensure that strong, well-resourced regulators emerge from the overhaul of financial regulation.
Speaking June 6, 2011, to the International Monetary Conference in Atlanta, Ga., Geithner said that those in the financial community who support blocking reform resources and appointments “will not be successful in undermining the core elements of reform.”
In fact, Geithner added, such efforts will “make it less likely that there will be enough capable people in the regulatory bodies to bring the care and judgment necessary for the new rules to work.” Firms that will suffer the most from weak regulators, he continued, would be the strongest and best managed firms as they would have to spend more time on compliance. Leaders of the major U.S. financial institutions should be “champions, not opponents of getting strong capable people to lead and staff the oversight bodies,” he urged.
Geithner also stressed the need to build a more level playing field internationally, as reforms in the United States move forward. “We don’t want to see another race to the bottom around the world,” he said. He told conferees that efforts by the United Kingdom to attract business to London, by applying only “light touch” regulation, “ended tragically” and should offer a “cautionary note” to other countries trying to take advantage of rising U.S. standards.