Barney Frank chairs the House Financial Services panel.The House yesterday overwhelmingly approved a plan to place strict new requirements on banks and other financial institutions that accept government assistance under the Treasury Department's $700 billion financial rescue program.
The measure, while unlikely to become law, could strengthen lawmakers' position as they deal with the White House on the rescue program.
By a vote of 260 to 166, the House agreed to require recipients of government cash to prove they are using the money to increase lending to consumers and small businesses, limit their ability to use the money to finance mergers, and bar them from paying bonuses to their top executives until the money is repaid.
The measure also would require President Obama to dedicate at least $40 billion to help distressed homeowners avoid foreclosure, in part by creating a "safe harbor" that would protect loan servicers that modify troubled mortgages from lawsuits by investors in those mortgages.
The Senate does not have plans to consider the bill, but Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee, said he still pressed forward with it because the House vote "gives me, frankly, more authority" to insist that Obama voluntarily enact some of its provisions. And if the Obama administration decides to seek funds beyond the $700 billion already approved by Congress, Frank said, "this will tell them what they need to do to get it." read more
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