Sen. Dick Durbin is fighting his top Democratic colleagues, Majority Leader Harry Reid and Sen. Charles Schumer, who want to move a bill easing regulation of Wall Street.

Despite mounting election pressures, Durbin (D-Ill.) is digging in his heels against giving new companies a five-year exemption from accounting and corporate governance rules.

{mosads}Durbin has been outspoken in his opposition to House-passed jobs legislation, which consumer advocates and labor unions argue has very little to do with creating jobs and is more geared to deregulating Wall Street.

Durbin’s stance has put him at odds with Schumer (N.Y.), his main competition to one day succeed Reid (Nev.). Schumer sponsored the bill’s central component, a five-year accounting and corporate governance exemption for newly public companies with less than $1 billion in annual revenue.

Reid appears to be siding with Schumer, structuring fast-track consideration of the legislation, which passed the House overwhelmingly earlier this month.

Some critics of the legislation think Reid, Schumer and President Obama have been swept up in election-year political considerations and have overlooked what they argue are dangerous policy implications in the bill.

“I think this bill, unfortunately, is being swept up in the wind of job mania. That means not a lot of attention is being paid to the detail that this involves investor abuse,” said Bartlett Naylor, a financial policy advocate at Public Citizen. “We think jobs has almost nothing to do with it.”

The split within the Democratic leadership has solidified Durbin’s allegiance with labor and consumer advocacy groups opposed to the bill, which they warn could open the door to corporate accounting frauds such as the one that cost investors in Enron Corp. nearly a decade ago. It has also underscored Schumer’s reputation as a lawmaker who sometimes sides with Wall Street over traditional Democratic allies.

“Sen. Schumer can be a good ally in the midst of a crisis, but between crises he is a strong advocate for Wall Street’s agenda. He has been pressing a rollback of Sarbanes-Oxley from the day it was passed,” said Barbara Roper, director of investor protection at the Consumer Federation of America, a reference to corporate accounting rules Congress passed in 2002 after the collapse of the Enron energy company. 

“Sen. Durbin has long been an advocate for us. He is less of a weathervane in his support for investor protections, so it’s not a surprise that he would be a champion,” she added. 

The Senate is expected to begin voting on the legislation Tuesday, first considering a Democratic-sponsored substitute amendment and then an amendment to reauthorize the Export-Import Bank.

Durbin and Schumer’s contrasting positions were in full display on the Senate floor last week.

“There is a bill that passed the House of Representatives with an overwhelming bipartisan vote. Its supporters have characterized it as a jobs bill,” Durbin said on the floor. “I will tell you, the House bill will not even get close to that on a good day.”

Durbin’s comments came shortly after Schumer praised the legislation as a bipartisan achievement.

“We will be working on a jobs bill that, while there are differences in the specifics, has broad bipartisan support and consensus,” Schumer said in an effort to rally colleagues to support it. “The lesson the American people taught us is they do not want obstruction, particularly for its own sake. They understand compromises have to be made in a legislative body.”

Consumers groups and other critics say impetus for the bill came from a task force on initial public offerings convened by Treasury Secretary Timothy Geithner. They say the White House is eager to tout bipartisan economic legislation.

“There’s a lot of pressure from the White House to send them a bipartisan jobs act,” Roper said.

Schumer has also been a driving force. He co-sponsored with Sen. Pat Toomey (R-Pa.) the original legislation to exempt businesses with less than $1 billion in revenues from accounting and corporate governance rules during the first five years after an initial public offering. 

The House bundled the Schumer legislation with other corporate reforms, including proposals to allow private companies to raise $50 million a year from investors without registering with the Securities and Exchange Commission and to allow direct solicitation of potential investors over the Internet with minimal public financial disclosure. The House package passed 390 to 23, an overwhelming margin consumers groups attribute to their slow response to the bill. 

Consumer advocacy groups and labor unions were slow to mobilize against the bill, but urged senators in writing on Monday to make substantial revisions. 

“The JOBS Act was rushed through the House without any attention to its potentially devastating impact on investors, market transparency, and the integrity of our capital markets,” groups wrote in a March 19 letter opposing the House-passed bill. “This legislation will leave seniors and families retirement savings at greater risk of fraud and speculative losses, and will strip accountability and transparency requirements that make markets work better for investors and businesses alike.”

Labor unions including the AFL-CIO and the American Federation of State, County and Municipal Employees, as well as groups such as Consumers Union, Consumer Federation of America, Public Citizen and Americans for Financial Reform, signed the letter.

Senate aides predict the substitute amendment, sponsored by Sens. Carl Levin (D-Mich.), Mary Landrieu (D-La.) and Jack Reed (D-R.I.), will fail to reach the 60 votes needed to pass. That would set the underlying House legislation up for a final voter either later in the day or later in the week. It is expected to pass with solid bipartisan support.

If the Democratic substitute amendment fails, Durbin and his allies will not have another chance to amend the underlying legislation — aside from reauthorizing the Export-Import Bank. 

A senior aide to Reid has told liberal groups that passage of the Ex-Im Bank amendment would give Senate negotiators a chance to make further changes to the legislation in Senate-House conference negotiations, but that claim has been met with skepticism.

Critics of the House-passed bill are skeptical that it could be revised substantially on the grounds that the Senate added language authorizing the bank, whose core mission is to help foreign customers, to finance large-scale purchases from U.S. companies.