Financial CHOICE Act of 2016

Financial CHOICE Act of 2016

This bill amends the Dodd-Frank Wall Street Reform and Consumer Protection Act, among other Acts, to:

• repeal the "Volcker Rule" (which restricts banks from making certain speculative investments);
• with respect to winding down failing banks, eliminate the Federal Deposit Insurance Corporation's orderly liquidation authority and establish new provisions regarding financial institution bankruptcy; and
• repeal the "Durbin Amendment" (which limits the fees that may be charged to retailers for debit card processing).

Certain banks may exempt themselves from specified regulatory standards if they maintain a certain ratio of capital to total assets and meet other specified requirements.

The bill removes the Financial Stability Oversight Council's authority to designate non-bank financial institutions and financial market utilities as "systemically important" (also known as "too big to fail"). Under current law, entities so designated are subject to additional regulatory restrictions. Designations made previously are retroactively repealed. 

The bill also amends the Consumer Financial Protection Act of 2010 to:

• restructure the Consumer Financial Protection Bureau by replacing its director with a bipartisan commission;
• subject the commission to the congressional appropriations process, expanded judicial review, and additional congressional oversight; and
• limit the commission's authority to take action against entities for "abusive" practices.

In addition, the bill:

• modifies provisions related to the Securities and Exchange Commission's managerial structure and enforcement authority;
• eliminates the Office of Financial Research within the Department of the Treasury; and
• revises provisions related to capital formation, insurance regulation, civil penalties for securities laws violations, and community financial institutions.