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Financial CHOICE Act Protects Our Small Banks and Credit Unions, Prevents Future Bailouts

Jun 8, 2017
Press Release

WASHINGTON D.C. – Congressman Kevin Cramer supported the Financial CHOICE Act today, which passed by a majority vote in the House of Representatives.

H.R. 10, The Financial CHOICE Act (CHOICE Act) would repeal much of the 2010 Dodd–Frank Wall Street Reform and Consumer Protection Act, and replace it with a bill that grows the economy, reduces the burden on community banks and credit unions, and ends government bailouts.

“Our local North Dakota banks and credit unions had nothing to do with the financial collapse, yet they’re the ones being punished by the regulatory impacts of Dodd-Frank,” said Cramer. Prior to the enactment of Dodd-Frank, 170 new bank charters were being created per year on average. Since its enactment, the United States has only created six new bank charters. During the same timeframe, more than 43 percent of banks under $100 million in assets have disappeared.

The decline in community financial institutions has also affected access to credit for small businesses. “72 percent of community banks report that Dodd-Frank rules have restricted their ability to extend credit for mortgages and other lending services, it’s no wonder small business lending from banks is at a 20-year low. With community banks having to restrict financial services – especially in small towns – Dodd-Frank is pulling the brake on our local economies and forcing a culture of bank consolidation. This has to stop.”

The CHOICE Act addresses these issues by removing the handcuffs from banks who practice safe, traditional banking. Cramer supported the CHOICE Act because it incentivizes banks to maintain high levels of capital and prevents another government bailout for large banks. Well-capitalized financial institutions will be rewarded for their safety by providing an off-ramp from many of the 27,669 regulations created by Dodd-Frank – allowing community banks and credit unions to, once again, go about the business of providing needed financial services for our farmers, small businesses, and families. I hope the Senate will take up this legislation quickly to protect the future of our rural communities and small businesses across North Dakota.

Below is a list of 10 wins included in the Financial CHOICE Act:

  1. More Accountability: Protecting consumers and growing our economy requires accountability from both Washington and Wall Street. That’s why accountability is at the heart of the Financial CHOICE Act. It imposes the toughest penalties in history for financial fraud, it puts Washington’s financial regulations on budget, and requires rules to pass a cost-benefit test and holds them accountable to Congress for major regulations.
  1. No More Bailouts: Dodd-Frank did not end “too big to fail”; instead Dodd-Frank enshrined it. Hardworking taxpayers still remain on the hook for Wall Street risk-taking thanks to Dodd-Frank’s bailout fund.
    The Financial CHOICE Act ends bank bailouts and “too big to fail” once and for all. There will be bankruptcy -- not taxpayer-funded bailouts -- for financial firms that fail. A “no more bailouts” policy also lays the foundation for a more resilient, stable financial system that creates economic opportunity for all Americans.
  1. More Economic Growth, More Jobs, and a More Reliable Financial System: Dodd-Frank’s excessive regulatory complexity has produced a less resilient financial system and stifled economic growth, particularly in small and rural communities.
    By reducing obstacles to credit and capital, the Financial CHOICE Act strengthens our financial system and promotes a dynamic economy with more jobs, higher wages and faster growth. These reforms “will allow the private sector to fuel economic growth in our 21st Century economy,” the Small Business Investor Alliance said.
  1. More Choices for Consumers: The “regulatory taxes” imposed by Dodd-Frank are passed onto consumers in the form of increased fees, fewer products and services, and more limited credit options. For example, since Dodd-Frank became law, the share of banks offering free checking accounts has fallen by almost half.
    The Financial CHOICE Act gives consumers more choices and options when it comes to credit, providing access to products and services they want and need. Consumers must be vigorously protected not only from fraud and deception, but also from the loss of economic opportunity and freedom.
  1. Help for Small Business, America’s Job Creating Engine: Even President Obama’s Small Business Administration director admitted Dodd-Frank’s regulations hurt small business lending. “Small banks have been laden with excessive costs and confusion from overlapping regulations, which are getting in the way of their ability to make small business loans,” she said.
    The Financial CHOICE Act includes numerous provisions – many of them strongly bipartisan – to eliminate unnecessary regulations in order to provide small businesses, start-ups, and entrepreneurs greater freedom to innovate, grow their businesses, and create jobs in our communities.
  1. More Certainty so Working Americans can Plan their Financial Futures: The best way for the Federal Reserve to help the economy is by adopting a transparent, strategy-based policy strategy that will provide more predictability for the American people. But currently, the Fed’s so-called “forward guidance” is vague and leaves hardworking taxpayers uncertain as they attempt to plan their financial futures.
    By promoting a more predictable and transparent rules-based monetary policy, the Financial CHOICE Act provides a stronger foundation for economic growth than the Fed’s improvisational approach of recent years.
  1. A More Level Playing Field: Dodd-Frank didn’t end “too big to fail,” but it did create “too small to succeed.” Unlike big banks, community banks can’t afford the armies of lawyers and compliance officers it takes to sort through Dodd-Frank’s red tape. This creates an uneven playing field.
    Since Dodd-Frank became law the big banks are bigger and the small banks are fewer. The Financial CHOICE Act provides desperately needed regulatory relief for Main Street banks and credit unions. This will help level the playing field and allow community financial institutions to devote more time and resources to meeting customer needs and free up resources for lending.
  1. More Savings for Working Americans: The Department of Labor’s Fiduciary Rule will cost working Americans billions of dollars in lost retirement savings. The Financial CHOICE Act repeals this misguided, unnecessary, and excessively complex regulation that makes it harder for working Americans to save and invest for retirement, college, and their future.
  1. More Financial Options: There are numerous provisions in Dodd-Frank touted as “investor protections” that actually increase costs, including rules that force companies to waste money on burdensome requirements rather than using that money to grow, thrive, and create jobs.
    The Financial CHOICE Act will amend and eliminate provisions that restrict financial opportunity and investment options for hardworking Americans and make it harder for businesses to create good-paying jobs.
  1. A More Accountable and Transparent Fed: Despite its failures during the run-up to the financial crisis, the Federal Reserve gained extraordinary new powers thanks to Dodd-Frank but no corresponding increase in its transparency or accountability to the American people.
    The Financial CHOICE Act protects the Fed’s independence when it comes to the conduct of monetary policy, but demands greater oversight, accountability, and transparency at the nation’s central bank. For example, the Financial CHOICE Act requires an audit of all aspects of Federal Reserve operations -- not just those that the Fed wants us to see. This is a necessary antidote to the secrecy and lack of transparency that have characterized the Fed for far too long.

Support from notable organizations: Independent Community Bankers of North Dakota, North Dakota Bankers Association, Credit Union Association of the Dakotas, American Civil Rights Union American Commitment, American Financial Services Association (AFSA), Americans for Constitutional Liberty, Americans for Limited Government, Americans for Prosperity (AFP), Americans for Tax Reform (ATR), Angel Capital Association (ACA), Biotechnology Industry Organization (BIO), Capitol Allies, Center for Freedom and Prosperity, Center for Individual Freedom, Center on Executive Compensation (CEC), Chamber of Commerce (COC), Club for Growth, Coalition for a Strong America, Competitive Enterprise Institute, Concerned Veterans for America, Council for Citizens Against Government Waste, Council of Insurance Agents and Brokers (CIAB), Credit Union National Association (CUNA), Electronic Payments Coalition (EPC), Equity Dealers of America (EDA), Freedom Partners, FreedomWorks, Frontiers of Freedom, Generation Opportunity, Heritage Action, Independent Community Bankers Association of America (ICBA), Independent Women’s Forum, Independent Women’s Voice, Institute for Liberty, Investment Company Institute (ICI), Investment Program Association (IPA), Manufactured, Housing Institute (MHI), Mid-Size Bank Coalition of America (MBCA), NASDAQ, National Association of Automobile Dealers (NADA), National Association of Federal Credit Unions (NAFCU), National Association of Home Builders (NAHB), National Federation of, Independent Business (NFIB), National Independent Automobile Dealers Association(NIADA), National Taxpayers Union (NTU), Property Casualty Insurers Association of America (PCI), R Street Institute, Real Estate Services Providers Council (RESPRO), Secretary Traders Association (STA), Small Business & Entrepreneurship Council (SBEC), Small Business Investors Alliance (SBIA), Taxpayer Protection Alliance, Tea Party Nation, The American Consumer Institute, Center for Citizen Research, The Libre Initiative, The Real Estate Roundtable

Through prior endorsements and co-sponsorships of financial reform legislation, Cramer has been a constant advocate for community financial institutions across North Dakota. To learn more about the legislation, visit