House GOP slows work on bills altering Dodd-Frank reforms

By Peter Schroeder - 05/15/12 01:29 PM ET

House Republicans are slowing work on a trio of bills that would tweak the Dodd-Frank financial reform law in the wake of JPMorgan's $2 billion trading loss.

House Agriculture Committee Chairman Frank Lucas (R-Okla.) announced Tuesday that his panel would be postponing a Thursday markup of the bills, which would have repealed or altered provisions of the financial overhaul.

Lucas directly cited the high-profile losses of the nation's largest bank as the reason for the delay, saying he wanted to make sure the bills would not inadvertently encourage Wall Street to take on risk haphazardly.

"As always, Washington has a tendency to overreact," he said in a statement. "While the news of JP Morgan’s trading loss is unfortunate, the bipartisan legislation the Committee was scheduled to consider is unrelated to the cause of the trading loss. However, this Committee will take the time to gather all relevant information before we proceed to ensure there are no unintended consequences of the legislation that would encourage recklessness in our financial institutions."

JPMorgan's major loss has set off a fresh round of recriminations of Wall Street and pressure from Democrats to establish strict rules for the financial sector. The bills set to be considered by the panel would have been particularly sensitive in the wake of the botched trade, given that they would affect the financial derivatives that played a key role in driving JPMorgan's losses.

The bills set to be considered were three measures that had earlier been cleared by the House Financial Services Committee — two of them by voice vote.

The third bill had bipartisan sponsors, offered by Reps. Jim Himes (D-Conn.) and Scott Garrett (R-N.J.). However, the measure proved more contentious at that panel, garnering limited Democratic support.

Rep. Barney Frank (D-Mass.), the ranking member of that committee, criticized that measure among others as primarily GOP attempts to weaken the financial overhaul bearing his name.

"Two bills reported out by the Republican majority on the Financial Services Committee in their current form would re-deregulate derivatives in ways that would again make them a threat to our economy," he said in a statement.