Former U.S. Representative Barney Frank, who gave his name to a landmark financial reform bill after the economic crisis of 2007-2009, has died at age 86, his sister Ann Lewis confirmed on Wednesday.
Along with then Sen. Chris Dodd, Frank led 2010 legislation that tightened banking regulations and consumer protections to avoid a repeat of the 2007 financial crash and subsequent Great Recession.
Known as the Dodd-Frank Wall Street Reform and Consumer Protection Act, the law resulted in new rules on the previously unregulated off-exchange derivatives market, CNBC noted, and set up the Consumer Financial Protection Bureau to shield consumers from predatory and abusive practices.
Ed Delgado, AMP, Managing Director, Mortgage Policy Advisors; Chairman Emeritus, Five Star Global, recalled his relationship with Frank.
“U.S. Congressman Barney Frank and I rarely, if ever, agreed on policy. After one especially contentious discussion, I felt compelled to apologize for being so unyielding in my stance. He quickly brushed it off, saying, ‘No need for you to apologize, Ed. I learn from people I disagree with. The more we debate, the more I learn.’ He was a formidable opponent and a lifelong learner,” Delgado said.
Law Regarded as a Success
The Dodd-Frank law was regarded as one of the main successes in Congress of Barack Obama’s two-term presidency, CNBC said.
As the financial crisis was unfolding and institutions such as Lehman Brothers investment bank were collapsing, CNBC said that Frank was at the heart of congressional efforts to save the U.S. banking industry and limit the damage to the wider economy.
Frank shepherded the Treasury Department’s $700 billion Troubled Asset Relief Program (TARP) bank bailout through the House in 2008, CNBC said.
The bailout stabilized the financial sector, with the U.S. government buying stock in eight major banks. By the time it ended in 2013, TARP had earned taxpayers a modest profit of $11 billion as the banks’ share prices recovered.
Some Democrats were critical, saying the bailout did not do enough to help the crisis-bound housing market and for allowing bankers to receive large bonuses even as the market was crashing.
CNBC noted that Frank defended his role in the bailout despite its flaws.
“I actually had a slogan which … I was dissuaded from using, in 2010,” he said in 2014. “It said, ‘Things would have sucked worse without me.’”
Bank Failures
Frank’s reputation as a banking regulation guru was called into question in March 2023, CNBC said, when the New York-based Signature Bank, of which Frank was a board member, collapsed along with Silicon Valley Bank and was seized by regulators.
CNBC noted that Franks, one of the best-known gay politicians of his time, served for more than 30 years in the U.S. House of Representatives as a member from Massachusetts and a liberal who willingly worked with Republicans.
“He’s a guy you can sit down and deal with,” Republican Representative Tom Cole from Oklahoma said in 2011, when Frank chaired the House Financial Services Committee, CNBC said.
