The Financial Stability Oversight Council, formed as part of new legislation under Dodd-Frank Wall Street Reform and Consumer Protection Act, convened for its first meeting Friday. The Council, comprised of a who’s who of the country’s top regulators including Timothy Geithner, Ben Bernanke and FDIC Chair Sheila Blair, is charged with identifying threats to the country’s financial stability, promoting market discipline and responding to emerging market risks.
In its meeting, members approved the Council's bylaws, transparency policy, an Advance Notice of Proposed Rulemaking on designating nonbank financial companies for heightened supervision, a Notice and Request for Information regarding the Council's "Volcker Rule" study and an Integrated Implementation Roadmap for both the Council and its independent member agencies.
The council has four months to study the Volcker Rule and make recommendations on how it should be implemented. Regulations are then due nine months after the study is completed. They will go into effect one year later.
Critics contend too many policy decisions will be left to unelected regulators, causing confusion and lapses in oversight and unnecessarily burdening financial markets.