West Virginia and ten other states are filing a lawsuit challenging the constitutionality of certain provisions of the Dodd-Frank Act.
The Dodd-Frank Act, which was signed into law by President Barack Obama in July 2010, implements sweeping reforms of the nation’s financial system.
West Virginia Attorney General Patrick Morrisey announced the states plans to join the lawsuit in a release from his office Thursday.
The lawsuit, which was originally filed by the states of Oklahoma, South Carolina and Michigan, and three private plaintiffs, is particularly questioning the constitutionality of Title II of the Act which gives Orderly Liquidation Authority (OLA) to the Secretary of the Treasury.
OLA gives the federal government the power to wind down financial companies labeled “too big to fail” and choose which of the companies’ creditors to bail out during a financial crisis.
Morrisey joins with the other states in claiming that by only helping financial institutions which are labeled “too big to fail” the smaller community banks that compose the overwhelming majority of banks in West Virginia and in other states are put at a disadvantage.
Also since the federal government, in particular the Federal Deposit Insurance Corporation (FDIC), is given sole power of choosing which creditors get payouts and which ones don’t, Morrisey adds they are essentially picking winners and losers, which entirely abandons the rule of law.
Morrisey claims Title II deprives West Virginia of its rights under federal bankruptcy laws to be treated fairly and equally. It potentially takes the state’s right to due process.
Also since West Virginia, both directly and through its pension funds, holds investments in many institutions potentially subject to OLA, Morrisey believes millions of dollars could be jeopardized in the end.
Congresswoman Shelley Moore Capito, who voted against the Dodd-Frank Act, released a statement following Thursday’s announcement supporting the lawsuit.
“We are already seeing the adverse effects this legislation is having on small financial institutions, consumers, and businesses,” said Capito.
In her statement, she promised, as Chairman of the Financial Institutions and Consumer Credit Subcommittee, to keep working to ensure West Virginia Community Banks and Credit Unions continue doing business.
The states of Alabama, Georgia, Kansas, Montana, Nebraska, Ohio and Texas are also part of the ten taking part in the lawsuit.
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Comments
RHytonen
NO !!
Not in MY name !!
These RACIST Republicans MUST BE ELIMINATED from government, most especially at the state level, where they're instituting textbook Fascism; and the hold of Wall Street and The Corporations must be REMOVED.
Wall Street "banks" intentionally took the huge, reckless risks that caused the recession, because they knew the ending of the Glass Steagall Act (by the Gramm-Leach-Bliley Act or GLBA,) forced the Federal Deposit Protection intended for CONSUMERS, to protect especially LARGE losses by "Investment Banks" - notoriously criminal Wall Street gambling houses- as if they were individuals' savings deposits.
This is what Dodd Frank intended to stop, but was gutted by the Republicans - the traditional lackeys of large corporate, global energy extractionists, and Wall Street business - though Democrats are not without blame as well.
(The voters' ONLY recourse there, is the Green -or Mountain- Party in WV. Because so-called "Libertarians," followers of the "free market" nutjobs Ayn Rand and Ron Paul, are for EVEN LESS regulation, and EVEN MORE power by the Corporations that have already ruined our beautiful state, and the country! )
Why do you think here's such unconscionable financial inequality, low wages, and high unemployment? Because that's how the uber-wealthy, business and finance WANT it! And they've been working on it by bribing goverment -"funding elections"- for 50 years, to murderously ignore safety and environmental regulations in mining, and to get the Top Marginal Tax Rate on mega-billionaires, down from 92% to 34% !
BUSINESS should not be writing our laws, (Google "ALEC," and "TTP trade agreement,") and allowed to ignore regulations and strip our energy resources for profit overseas, so that the government helps them fleece the individual and strip and sell off the country's wealth and energy resources on th global market, like a stolen car in a chop shop.
We formed a government to PROTECT the individual FROM the power of large, government "chartered" business - starting with England's East India Tea Company, one of (if not the) world's FIRST Corporations.
Do your homework, voters - government HELPING industry IS Mussolini's definition of Fascism. Half a million brave Americans DIED, and many more of us sacrificed at home, to stop that, in other countries- now we allow it HERE, because corporations can afford to BUY advertising like this "article?"
February 15, 2013 at 7:24 am | Report comment
NortherWVman
amazing that now ALL Republicans are racist. I love how Obama lovers love to throw that word "RACIST" around so flippently.
February 15, 2013 at 8:01 am | Report comment
Wvrefugee
Sorry, voters in WV are amazingly stupid and uninformed!! If they heard it on Fox News, it must be true!!!;)
February 15, 2013 at 10:24 am | Report comment
RHytonen
This is simply part of the 'anti-Obama' agenda that Republicans have adopted, instead of honoring their oaths and governing in cooperation with the government they were elected to implement.
There is nothing legal about sabotage of the administration =policies - the American voters overwhelmingly chose by a legal election.
And there is no hypocrisy and subterfuge quite as heinous as claiming to end deregulated Wall Street abuse, by throwing out ALL regulation, using a duplicitous claim it's because it doesn't go far enough.
February 15, 2013 at 7:42 am | Report comment
chuck
Well, RHytonen, thn you have isues that you a spouting about with no proof. First you call Republicans racists yet Lincoln was a Republican who had the emmancipation proclaimed and that IS the reason why the state was broken away from the slave state of Virginia. If you are blamimg the loss in the housing markets to Wall Sreet then you need some education. First, as aregistered rep, if someone wanted into the mortgage business it was only into business and corporate mortgages, not personal home ownership. Then the Dodd, Frank and Schumer bill passed to allow Wall Stree to sell stocks and bonds in the housing market and that was done after I had left Prudential. I was later a mortgage broker loan officr but could only use the big banks like Chase, GMAC, Wells Fargo and about 8 other lenders that have had major issues, but again, afte I left. I refused to finandce arms since I knew that people wouldn't be ab;le to handle the jolt of up to a 10% interest rate increase of what they wanted then. BTY, Not only did Frank, Dodd and Schumer got housing into wall street and did so with the backing of Fanney, Freddy and even Ginny. Intresting is that the states those three guys are from have ove 2/3rs of the faults but includes Florida wher they all three own properties. Botom line is it isn't wall street but the politicians that bought their elections. No differnt than JFK buying WVa with a pint of whisket and 50 cents in the 1960 elction.
February 15, 2013 at 10:46 pm | Report comment
J.R. Skene
Hey Morrissey, how does it feel to be on the wrong side of history?
February 15, 2013 at 8:14 am | Report comment
Hop'sHip
He said that AG duties go beyond consumer protection. Someone has to look out for those powerless financial institutions.
February 15, 2013 at 8:19 am | Report comment
wvman75
I still can't believe that this law contains the names of two of the people who most caused our economic collapse to begin with.
February 15, 2013 at 9:58 am | Report comment
Levelheaded
wvman75: You are absolutely right. Now we have Barney in the Senate. If these morons don't wake up this country has had it.
February 19, 2013 at 9:04 am | Report comment
wvman75
That's some real liberal nerve, right there.
February 15, 2013 at 9:58 am | Report comment
Wvrefugee
Morrissey is a Right Wing Nut and is using the state ag seat as aplatform to promote idiocy and hate!! Earlier this week he says he intends to send our president a letter putting him on notice!!!!!! That says it all right there!!!!!!
Stupid West Virginians elected him! I think Id rather have Sarah Palin as our AG!!!!!!!
Capito needs to join him as well!!
February 15, 2013 at 10:23 am | Report comment
RS
The AG has no authority to do this. He's the state's attorney, not his own. Can't wait till the Supreme Court smacks him down.
He's after more publicity than McGraw's trinkets ever did.
February 15, 2013 at 11:46 am | Report comment
C.Hoffman
The asteroid must be effecting the statist blogs today. Does somebody need a hug? Dodd-Frank Act is a disaster. It reinflates the bubble Dodd & Frank created bringing us to and over the precipice. The sudden stop is coming.
February 15, 2013 at 2:13 pm | Report comment
GeorgiaAnnaG
Which State officer gave the written authorization to the AG? An AG cannot commence or join litigation in the name of the State on his own initiative.
February 15, 2013 at 2:32 pm | Report comment
BHHaz
I'm proud to say I am republican and proud that I voted for Morrisey.
February 15, 2013 at 10:27 pm | Report comment
welfareworker
just wondering what the ill effects are that are being felt by our smaller banks.
certainly attacking Dodd Frank which puts many consumer protection actions into place follows the line of attak of this AG.
WV will be sorry in the long run without question that they voted in a carpet bagger with whose goal is nothing more than the self promotion he claimed to be against
February 16, 2013 at 4:04 pm | Report comment
commonsense
"These RACIST Republicans MUST BE ELIMINATED from government, most especially at the state level, where they're instituting textbook Fascism; and the hold of Wall Street and The Corporations must be REMOVED. "
Interestingly enough....THAT is a Fascist type statement. MUST BE ELIMINATED??!!! Sounds like we are living in Germany in 1939.....
February 17, 2013 at 4:45 pm | Report comment