Congress passes financial regulation (banking seizure) bill.

Congress OKs Wall St. crackdown, consumer guards

Congress on Thursday passed the stiffest restrictions on banks and Wall Street since the Great Depression, clamping down on lending practices and expanding consumer protections to prevent a repeat of the 2008 meltdown that knocked the economy to its knees.


A year in the making and 22 months after the collapse of Lehman Brothers triggered a worldwide panic in credit and other markets, the bill cleared its final hurdle with a 60-39 Senate vote.


It now goes to the White House for President Barack Obama's signature, expected as early as Wednesday.


The law will give the government new powers to break up companies that threaten the economy, create a new agency to guard consumers in their financial transactions and shine a light into shadow financial markets that escaped the oversight of regulators. The vote came on the same day that Goldman Sachs & Co. agreed to pay a record $550 million to settle charges that it misled buyers of mortgage-related investments.


From storefront payday lenders to the biggest banking and investment houses on Wall Street, few players in the financial world are immune to the bill's reach. Consumer and investor transactions, whether simple debit card swipes or the most complex securities trades, face new safeguards or restrictions.


A powerful council of regulators would be on the lookout for risks across the finance system. Large, failing financial institutions would be liquidated and the costs assessed on their surviving peers. The Federal Reserve is getting new powers while falling under greater congressional scrutiny.


"I'm about to sign Wall Street reform into law, to protect consumers and lay the foundation for a stronger and safer financial system, one that is innovative, creative, competitive and far less prone to panic and collapse," Obama said.


"Unless your business model depends on cutting corners or bilking your customers, you have nothing to fear."


Republicans said the bill is a vast federal overreach that will drive financial-sector jobs overseas. Before the final vote was even cast, House Republican leader John Boehner called for its repeal.


At an eye-glazing 390,000 words — half the size of the King James Bible — the legislation doesn't offer a quick remedy, however. Rather, it lays down prescriptions for regulators to act. In many cases, the real impact won't be felt for years.

Two words: veiled tyranny.