Washington D.C. – Today, Oregon’s U.S. Senator Jeff Merkley and Banking and Housing Committee Chairman Sherrod Brown (D-OH) applauded the Securities and Exchange Commission (SEC) for reintroducing proposed rulemaking to address conflicts of interests in the securitization market.
“Conflicts of interest in the securitization market contributed to the 2008 economic collapse. Sadly, many of those same financial institutions are still able to sell investors asset-backed securities, bet against them, and line their own pockets. It’s perverse that those who sell financial products can profit by betting against them, at the expense of investors. We applaud the SEC and Chair Gensler for taking up the cause to fulfill Congress’ intent to restore integrity and stability to the financial marketplace, ensuring that firms can’t bet against the interests of their own customers.”
Merkley and Brown – along with the late Senator Carl Levin – worked to include Section 621 in 2010’s Dodd-Frank Wall Street Reform and Consumer Protection Act. Section 621 prohibits conflict of interest for financial entities that create and sell asset-backed securities.