Rodge Cohen Urges Congress to Correct Swaps GlitchJanuary 9, 2013
On January 9, Mr. Cohen was quoted in the American Banker article, “Swaps Glitch May Penalize Foreign Banks,” which discussed the flaw in the Dodd-Frank Act that unintentionally penalizes foreign banks operating in the United States. “If there were a single technical correction which Congress should deal with, it seems to me it is this one. It is a very harsh and inequitable result, not only with no justification but with no intent,” Mr. Cohen argued.
The Federal Reserve and FDIC have yet to issue policies about the phase-in period, leaving uncertainty about what Congress or regulators will do to help foreign banks. The Office of the Comptroller of the Currency has requested federally chartered banks and thrifts to submit written requests to delay compliance for up to two years, when at that point Dodd-Frank will allow agencies to permit an additional year of time. “Giving time here recognizes the realities of the situation without creating, I think, any real risk to the banking system,” noted Mr. Cohen.