Lobby groups representing JP Morgan, Goldman Sachs and others have sued the Federal Reserve, claiming the stress tests violate the law - The Daily Hodl
The Federal Reserve has sued several organizations representing major U. S. banks, claiming the Fed's annual capital stress tests violate U. S. law.
the Bank Policy Institute, the Ohio Bankers League, the Ohio Bankers League, the Ohio Chamber of Commerce, the U. S. Chamber of Commerce, the Ohio Chamber of Commerce, the Ohio Chamber of Commerce and the U. S. Bankers Association have sued several organizations representing major U. S. banks, alleging that the Fed's annual capital stress tests violate U. S. law. Commerce, the U. S. Chamber of Commerce and the American Bankers Association (ABA) jointly filed the lawsuit in Federal District Court in Columbus, Ohio.
The lawsuit alleges that the Federal Reserve Board (FRB) has failed to take steps to prevent large banks from On Monday, the FRB issued a press release saying that it is considering making bank stress tests more transparent and reducing the volatility of its capital adequacy rules. . The banking lobby sees this as a positive step, but says it must go to court to preserve its legal rights because of the impending statute of limitations.
According to the lawsuit, the Fed's stress testing regime was adopted in secrecy and contains volatile and unexplained bank capital requirements.
The lawsuit
aims to ensure that bank capital requirements are set in a transparent and participatory manner, consistent with the provisions of the Administrative Procedure Act and due process after 2026.
In a statement posted on the ABA website in which Chairman and CEO Rob Nichols said the Fed's stress tests are inherently opaque and undermine the value of providing meaningful information about the health of banks.
Nichols said the ABA is working to improve the transparency of the tests to create a fairer regulatory environment.
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