Saying that the "encroachment of federal preemption only weakens the states' strong front-line defense against deceptive and unlawful financial services practices," NASCUS today urged lawmakers to ensure that consumer safeguards should compliment, not replace state laws.
In a letter to Senate Banking Committee Chairman Christopher Dodd and the panel's top Republican Richard Shelby, NASCUS President/CEO Mary Martha Fortney urged them to reject any amendments that would weaken the power of state lawmakers and regulators to enact laws and regulations that are stronger than the federal government. Organizations representing financial institutions with federal charters, such a NAFCU, have said they will try to persuade lawmakers to pass an amendment that would place further restrictions on state regulators.
Fortney also urged lawmakers to include a representative of state regulators on the proposed systemic risk council. She noted that state regulators "are in a position to detect problems at the local level before they become a greater national risk."
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She also reiterated the group's request that lawmakers consider capital reform by amending the definition of net worth to allow all forms of capital.
The Senate could begin consideration of a regulatory restructuring measure later this week. The House passed a similar bill last December.
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