Hi friend, 

It’s been another busy month being a counterweight to Wall Street’s biggest banks, their CEOs, the crypto industry, and the broader financial industry, which has been relentlessly using all the levers of the influence industry to bend the policymaking process to benefit themselves at the expense of consumers, investors, financial stability, and the economy. 

First, Wall Street’s CEOs are attacking new rules to protect Main Street families, businesses, and community banks from big bank failures and bailouts by requiring them to have more capital to absorb their own losses. Undercapitalized banks pose a grave threat to our country, as just proved again by the failure of First Republic Bank and Silicon Valley bank: they failed and were bailed out because they didn’t have enough capital.  However, maximizing banker bonuses requires minimizing capital – good for Wall St, but terrible for Main St.  Of course, Wall St and the CEOs would never admit that; instead they are engaged in a disinformation campaign based on false claims that we exposed in this Fact Sheet as baseless and dangerous.

Second, in a sneaky backdoor proposal, a private, profit maximizing financial firm backed by some of the biggest names on Wall Street and Silicon Valley is attempting to get the CFTC to allow bets of up to $100 million per trader on U.S. elections via so-called “event contracts.” We’ve been opposing this attempt to endanger our democracy for more than a year and have asked the CFTC to reject the proposal based on the law, public policy, and the facts. Our efforts included rallying hundreds of policymakers, advocacy groups, and concerned citizens in urging the CFTC to reject the proposal to turn our 

democracy into a casino. Read more about in my latest Op-Ed for The Hill.

Third, for years now, crypto has operated as a lawless industry, refusing to comply with well-established laws and regulations. The consequences for Main Street have been severe, $2 trillion in losses, multiple bankruptcies, dozens and 

dozens of lawsuits for lying, cheating, and stealing, facilitating ransomware, money laundering, and illegal conduct of all types. Now, the industry is trying to rewrite the laws and rules that protect investors, customers, markets, our financial system, and economy to benefit them and their predatory if not illegal business practices. That’s why this month we held a “Crypto Week of Truth” to shine a light on the industry’s actual record of crime, broken promises, and massive lobbying and influence campaigns. We kicked off the week with a not-to-be-missed webinar featuring accomplished independent experts: Professor Hilary Allen (author of Driverless Finance) and Former CFTC Commissioner/CFTC General Counsel/SEC General Counsel Dan Berkovitz.

These cases of capital, gambling, and crypto are just the latest reminders that there are still too many CEOs and financial firms putting their self-interest in maximizing profits over the public interest. Their hope is that no one is watching and that no one will highlight and expose what they are doing.  But when Wall Street’s CEOs deploy their lobbyists, lawyers, and spinners to bend the rules, Better Markets’ staff is there pointing out and fighting what they are doing, like their opposition to capital to maximize their bonuses.

It's thanks to your support and partnership that we can do this: speak truth to power, no matter how many political allies, influence, and access the industry and special interests have in Washington.   

Best,
Dennis

Dennis Kelleher
Co-Founder, President & CEO, Better Markets

On July 27, banking regulators proposed new, long overdue, capital requirements for the largest banks – just 33 out of almost 4,700! Bank capital is like the down payment on a house and is critical to protect Main Street families, jobs, small businesses, community banks, the financial system, and the economy. But Wall Street and its supporters have made false, baseless, and dangerous arguments about capital to protect their bonuses and bottom line. We released a new fact sheet, “Ten False Claims About Capital,” rebutting their scare tactics, smokescreen, and disinformation campaign.

Bank capital is critical. However, maximizing Wall Street’s bonuses depends on minimizing capital and that’s why Wall Street fights to prevent regulators from requiring them to have enough capital.

- Dennis Kelleher on the importance of capital

Banking regulators are required by law to identify risks no matter where they come from and ensure they are mitigated before they materialize and cause bank failures, financial crashes, and economic contractions if not catastrophes. If regulators ignore the risks from climate change or exempt certain industries such as oil and gas from their risk analysis, they would violate their statutory duties to protect the stability of the nation’s financial system.

Investor demand for ESG investments coupled with the strong returns such investments offer means investors need to know where companies stand on the ESG criteria and what investments include legitimate ESG investing. Fortunately, the SEC has proposed three rules that aim to provide investors with precisely the information they want and need. We explained these issues in a fact sheet we sent to the House Financial Services Committee ahead of an ESG hearing.

America’s Main Street families benefit from a diversified banking system, from community banks to regional banks to large banks. Done right, bank mergers can be a healthy part of that system but, done wrong, they can be destructive and counterproductive. Unfortunately, the current merger review process utilized by the Federal Reserve, Office of the Comptroller of the Currency, and Federal Deposit Insurance Corporation is seriously deficient.

As lawmakers consider the path forward on crypto regulation, they must evaluate the failed promises of the industry and the carnage, manipulation, and outright fraud we have seen in recent years, costing investors trillions of dollars in losses. Whether they vote for or against any particular legislation, Better Markets outlined the key issues they should consider in a letter to the leadership of the U.S. House Committee on Agriculture and the Committee on Financial Services regarding the Crypto Market Structure Discussion Draft.

Better Markets welcomes Shayna Olesiuk, CFA, who most recently served as Deputy Director for Deposit Insurance and Risk Analysis in the Division of Insurance and Research for the Federal Deposit Insurance Corporation (FDIC), as Director of Banking Policy.

“When large banks have too little capital, Main Street families, small businesses, community banks and the entire economy pay the price.”

- Dennis Kelleher for CNN

July 10
The Fed’s Vice Chair for Supervision Suggests Big-Bank Regulation Changes

July 12
Regulators are aligned on capital reforms. Congress is a different story.

July 12
U.S. Takes Third Shot at Shoring Up Money-Market Funds

July 24
Election Betting Platform Could Harm Democracy, CFTC Told

Each month our legal team outlines some of the top cases we're keeping an eye on, the Amicus "Friend of the Court" Briefs we have filed, and why everyone with a bank account, credit card, mortgage loan, or retirement loan should be interested in those cases.  

July marks the last legislative sessions before the August recess and many must-pass bills make their way through Committees and the floor. Despite the looming September deadlines, the House Majority used this time to attack ESG policies and push through crypto legislation sponsored by the industry it tries to regulate.

This summer, American families are subject to higher prices for essential barbecue items. For example, a 32-ounce bottle of ketchup, which averaged $4.08 during the week of May 16, 2022, rose to $5.22 by the week of May 15, 2023—a significant jump of nearly 28%. By fine-tuning position limits regulation, the CFTC can ensure fairer markets that protect consumers.