WASHINGTON – Sen. Carl Levin, D-Mich., made the following statement today regarding the SEC vote to approve conflict-of-interest regulations, implementing part of the Merkley-Levin provision in the Dodd-Frank Wall Street reform bill:
“Today’s unanimous vote by the SEC to approve conflict-of-interest regulations is hopefully an important step forward for real Wall Street reform. The Permanent Subcommittee on Investigations, which I chair, issued a report in April that detailed damaging conflicts of interest by investment banks, credit rating agencies, mortgage companies and even federal regulators. Our report showed, for instance, how one financial institution, Goldman Sachs, created junk investments and sold that junk to their clients while betting that those same investments would fail. It was as if a car dealer sold a car with bad brakes, then bought insurance that paid off when the car crashed.
“Sen. Merkley and I drafted the conflict-of-interest provisions of Dodd-Frank to make it clear that if such conflicts are not already illegal, they will now be brought to a halt. Congress clearly intended to end them. We also need strong rules and strong enforcement to end all of them, and I will review the SEC’s proposed rule to see if it does what is needed.”
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