Frank Urges Overhaul of Business Regulations

Boston Globe (03/21/08); Gavin, Robert
House Financial Services Committee Chairman Barney Frank, D-Mass., speaking before the Greater Boston Chamber of Commerce, said Congress will push for stricter regulation of securities firms and mortgage brokers when it meets next year to prevent another subprime crisis like the one the nation is dealing with now. According to the lawmaker, "We now see a situation that more damage was done by inadequate regulation. What we have is a systemic problem, and that's what we want to address." He noted that mortgage brokers and investment banks, which are loosely regulated, account for many troubled subprime loans. Additionally, Frank underscored the importance of rebuilding the "lender-borrower relationship," which has suffered because lenders have the ability to unload risks by packaging mortgages into securities and selling them to investors