By Peter Schroeder - 01/08/14 11:32 AM EST
Sens. Elizabeth Warren (D-Mass.) and Tom Coburn (R-Okla.) are pushing to eliminate the “back-room dealmaking” that occurs when federal regulators strike settlements over charges of wrongdoing.
The bill comes as many lawmakers, particularly Democrats, have grumbled about the government’s unwillingness to take major Wall Street actors to trial.
“Anytime an agency decides that an enforcement action is needed, but it is not willing to go to court, that agency should be willing to disclose the key terms and conditions of the agreement,” Warren said. “Increased transparency will shut down backroom deal-making and ensure that Congress, citizens and watchdog groups can hold regulatory agencies accountable for strong and effective enforcement that benefits the public interest."
The bill seems inspired by recent deals the government has struck with major banks, much to some lawmakers’ chagrin. Many on the left openly complained when it was revealed that a $13 billion settlement the government struck with JPMorgan included roughly $4 billion in tax writeoffs.
Under tax law, corporations can deduct any portions of a settlement that are considered restitution or compensation, but not for penalties or fines.