A Year Later, Dodd-Frank Delays Are Piling Up

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A year after Congress enacted the huge Dodd-Frank financial regulatory overhaul, the law is seriously behind schedule.

The Dodd-Frank Act turned a year old on Thursday, a milestone that was supposed to be Day One of many new rules for Wall Street. Instead, this month the Securities and Exchange Commission and several other financial regulators missed some 100 rule-writing deadlines, according to a new report by the law firm Davis Polk.

The law cracked down on the opaque derivatives market, loose lending standards and other problems that set off the financial crisis. Now it’s up to regulators to enforce the law, which mandates more than 300 new rules.

While the agencies were supposed to complete roughly 160 regulations by now, 80 percent of them remain unfinished, the Davis Polk “Dodd-Frank Progress Report” found. Over all, nearly 90 percent of all rules are incomplete. Regulators also failed to complete seven studies, including review of short selling and foreclosures.

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The S.E.C., which has the largest responsibility under Dodd-Frank, alone has missed 54 deadlines, according to Davis Polk.

In June, the Commodity Futures Trading Commission decided to formally postpone some derivatives rules for up to six months. The agency did, however, recently sign off on nearly 10 new proposals, including rules that greatly expand the government’s ability to police insider trading and other fraud.

The remaining delays are largely expected, as regulators scramble to finalize new rules on shoestring budgets. The Government Accountability Office estimated that it will cost regulators $1.25 billion to enforce the law over the next two years.

But as regulators face a budget crunch amid the broadening mandates, Republican lawmakers are threatening to cut regulatory spending even further. In June, a House committee approved a plan to keep the Securities and Exchange Commission budget flat. Some lawmakers want outright cuts.

“They are trying to stall,” Representative Barney Frank, the Massachusetts Democrat who was a co-author the Dodd-Frank law, said of the Republicans. Their plan, he said in a recent interview, is to “hope that they will win the 2012 election with the support of the financial people.” Once in control of Washington, he said, Republicans would “then undo what we were able to do, and then, yes, the system would be at risk.”