U.S. Business Law

Featured, Financial Regulation, Home, Securities, U.S. Business Law, Volume 6

The Role of Section 20(b) in Securities Litigation

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William D. Roth: In response to a 2011 Supreme Court ruling that restricted the use of Section 10(b) of the 1934 Act as a cause of action for fraud, SEC Chair Mary Jo White expressed in 2014 her agency’s intent to use Section 20(b) to litigate cases where Section 10(b) would no longer be viable. This Article assesses whether Section 20(b) can be an effective litigation tool for the SEC and private plaintiffs by dissecting the provision’s function and purpose, and by delving into its relevant legal doctrinal questions.

Derivatives Regulation, Dodd-Frank Anniversary, Featured, Financial Regulation, Home, U.S. Business Law, Volume 6

The Swaps Pushout Rule: Much Ado About the Wrong Thing?

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John Crawford and Tim Karpoff: A notably bitter battle over financial reform in the wake of the crisis of 2008 has centered on the Swap Pushout Rule: a Dodd-Frank mandate that federally insured depository institutions—i.e., banks—refrain from entering into certain derivatives contracts. After several of the largest U.S. financial institutions successfully lobbied to roll back the Rule, the rollback inspired intense criticism, but the critiques have not accurately reflected what is really at stake for the banks or the public. While the Rule was sold as an anti-bailout measure, this Article argues that the Rule would have been ineffective as a means of preventing further bailouts of systematically important bank holding companies. The Article further argues that the primary reason systematically important bank holding companies care about the Rule is that it costs more to fund these swaps if they are booked at a different legal entity, such as a broker-dealer, rather than at a bank.

Featured, Financial Regulation, Home, Volume 6

www.PayDayLoans.gov: A Solution for Restoring Price-Competition to Short-Term Credit Loans

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Eric J. Chang: Much of United States financial regulation has been predominantly based upon using mandated disclosure to facilitate price-competition. However, in the realm of payday lending, disclosure based regulation has received significant criticisms from regulators and consumer advocates. While federal action may be necessary to solve the payday lending problem, this Article argues that a movement towards stricter and more stifling regulations is an overreaction to the statement that disclosure is not working. Instead, this Article proposes a less burdensome but much more effective alternative: a federal online exchange for payday lenders to list and post lending rates.

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