Biden urges Congress to 'act to more heavily punish' offending bankers
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Mario Tama Agence France-Presse Noting that the law today limits the capacity of administrative authorities to act, Joe Biden judges that it should be “easier for regulators” to financially sanction bankers.
Joe Biden believes that “Congress must act to more heavily sanction bank executives whose mismanagement has contributed to the failure of their institutions”, according to a statement released Friday.
As the American banking world is rocked by several failings, the president argues that “no one is above the law” and that “toughening up accountability has an important deterrent effect in preventing future instances of mismanagement”.
Noting that the law today limits the ability of administrative authorities to act, he considers that it should be “easier for regulators” to financially sanction bankers.
Joe Biden therefore asks parliamentarians Americans to give more power to the regulatory authorities, and in particular to the Deposit Guarantee Agency (FDIC), the body that intervenes in the event of bank failure.
In particular, the US president would like this organization to be able to “demand” remuneration paid to offending bankers, impose fines on them, and prohibit them from practicing in the sector in the future.
It remains to be seen how his appeal will be heard: the Democratic party, that of Joe Biden, controls the Senate, but the other house of Congress, that of the representatives, is dominated by the Republican opposition.
However, the conservatives are generally hostile to any tightening of banking regulation.
Joe Biden's appeal to Congress comes after the American banking world was shaken by the bankruptcy of Silicon Valley Bank, an institution linked to the world of tech, and by the debacle of Signature Bank, a New York establishment.
Thursday, a group of large American banks had to fly to the aid of another establishment, First Republic, considered to be the new weak link in the system.
This rescue did not reassure for long the markets, which were still very feverish on Friday.