SEC to consider Volcker Rule behind closed doors

The Securities and Exchange Commission will vote next week on a landmark financial regulation that would prevent banks from engaging in trades for their own profit. 

The SEC is the last of five agencies to announce a vote on the controversial Volcker Rule, and the only one planning to meet privately. 

{mosads}It said it would use the “seriatim process” to consider the rule. That process allows agencies to consider business outside of public view and is rarely used for high-profile votes.

“We expect to move up our consideration of the Volcker rule to December 10 using the seriatim process to coordinate our timing with the other agencies on what is expected to be a joint rulemaking and to enable all of our Commissioners to participate in the vote and express their views,” SEC spokesman John Nester said in an email.

The Commodity Futures Trading Commission, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency and the Federal Reserve will all meet in open session on Tuesday for the vote.

The rule is designed to prevent banks from engaging in risky bets with taxpayer money, which contributed to the financial crisis. In addition to banning proprietary trading, it also limits banks’ ability to get involved with hedge funds and private equity funds.

Named after former Federal Reserve Chairman Paul Volcker, the rule was extremely controversial with banks, which said it would limit liquidity and limit their growth. 

All five agencies have authority over the regulation, which is one of the largest remaining measures from the 2010 Dodd-Frank financial reform law. 

The SEC’s schedule for the vote had previously been in question. According to Reuters, the agency had been dealing with scheduling problems, because two of the agency’s five commissioners are planning to travel overseas next week.