House Financial Services Committee Chairman Hensarling Urges Secretary Lew to Cease Using "Too Big to Fail" Designations

During a hearing on the state of the international financial system, House Financial Services Committee Chairman Jeb Hensarling (R-TX) called on Secretary of the Treasury and Financial Stability Oversight Council ("FSOC") Chair, Jacob Lew, to "cease and desist" from designating more financial firms as "too big to fail" until there is an opportunity for greater congressional oversight of the FSOC's decision-making process.

According to Chairman Hensarling, there "is increasingly bipartisan concern about the immense discretionary power that FSOC has and how frankly little transparency it has," stating that there is little indication of a methodology behind FSOC's ability to effectively put nonbank institutions into bailout positions.

Chairman Hensarling pressed Secretary Lew further to explain FSOC's decision making during a question-and-answer exchange at the hearing.