Can mere sunshine disinfect a city swarming with lobbyists? We may soon find out.
The Federal Deposit Insurance Corp. said Thursday it is adopting an “open door” policy to let the public see exactly how the financial regulatory reform legislation adopted last month translates into rules for banks and their customers.
As part of the new policy, the FDIC will release the names of private-sector people who meet with officials to discuss reform rulemaking.
The FDIC will release, on a bi-weekly basis, the names and affiliations of private sector individuals who meet with senior FDIC officials to discuss implementing the new law through independent or joint rulemakings. The FDIC will also release the subject matter of those meetings.
The move is Washington’s latest effort to push back at the lobbyists hired by big financial firms. The congressional conference that produced the Dodd Frank Act legislation that was later signed by President Obama televised its meetings, letting people with a strong stomach get a peek at the legislative sausage being made.
“I think transparency is a significant issue for each step along the way,” FDIC chief Sheila Bair (right) said in a statement Thursday. “We owe it to the public to have an open door policy so that people can see for themselves how financial services reform is going to be implemented.”
Bair warned in June that regulators had to be on guard against the onslaught of lawyers arguing for their clients’ interests. She acknowledged that regulators failed to uphold standards during the last boom, which helped feed excessive risk-taking and inflated a credit bubble that collapsed with devastating effect two years ago.
Bair urged her colleagues to put the health of the financial system first, which she said could prevent that unhappy scenario from playing out again.
“We need to hold the course,” Bair told Reuters in June. “We cannot let ourselves forget what happened in October of 2008 and all the events leading up to that.”
