President-elect Donald Trump and his advisors have made no secret of their plans to dismantle regulations put in place after the financial crisis, and there may be little standing in his way once Trump assumes office in January.
That's because Mary Jo White, chairwoman of the Securities and Exchange Commission — the government's most important Wall Street regulator, tasked with protecting investors and retirement savers from fraud and increasing transparency, among other responsibilities — announced her resignation on Monday.
According to the New York Times, the effort to choose her successor is being led by deregulation proponent Paul Atkins, the former SEC commissioner under President George W. Bush from 2002 to 2008, who presided over the financial crisis. Atkins himself could even be a candidate, the Times reports.
Despite leading the crackdown on Wall Street through regulatory reforms required under Dodd-Frank, White was considered by many to be an independent and political moderate; Massachusetts Senator and banking industry critic Elizabeth Warren even called for her departure last October, arguing White had not been harsh enough.
"You've put the interests of the Chamber of Commerce and their big business members at the top of your priority list," Warren told White during a Senate hearing reported by CNNMoney.
Now, a shift to even lighter regulation is likely — three of the five commissioner seats will have to be filled by Trump because the GOP-led Senate has not confirmed President Barack Obama's most recent appointments.
A former prosecutor who oversaw the original investigation of Osama Bin Ladin, White was tasked with modernizing the SEC and implementing many of the reforms of the Dodd-Frank Act, a bill passed in the wake of the financial crisis with the goal of mitigating risk in the banking system.
White had a reputation for being a tough enforcer: In the last fiscal year, for example, she brought a record 548 enforcement actions, and eliminated the SEC's unofficial policy of letting banks neither admit nor deny wrongdoing if they agreed to pay settlements — pushing more than 70 defendants to admit responsibility.
A lack of consensus between the two remaining commissioners could lead to gridlock after White's departure, as the Wall Street Journal reports, because any one commissioner has an effective veto over enforcement actions and new regulatory policy. Experts also told the Journal that the fate of Dodd-Frank was "up in the air."
Losing Dodd-Frank might mean losing or weakening actions and agencies the law created, like the Consumer Financial Protection Bureau, which protects Americans from debt collector harassment and misleading or unethical behavior by consumer banks and student lenders — among other important protections.
A policy brief on President-elect Trump's transition website promises to "dismantle" Dodd-Frank and replace it with "new policies to encourage economic growth and job creation."