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GOP: Outgoing SEC chief defying ‘will’ of the people with midnight rules

“Midnight rulemaking” is not conducive to sound policy, Rep. Jeb Hensarling says. (AP Photo/Seth Wenig, File

December 14, 2016

Outgoing Securities and Exchange Commission Chairwoman Mary Jo White is “defying the will of the American people” by moving forward with rulemaking before the next administration takes office, a top Republican said Tuesday.

Rep. Jeb Hensarling, chairman of the House Financial Services Committee, took White to task for keeping open the possibility that the agency she leads might vote on finalizing rules before January, saying that such “midnight rulemaking is neither conducive to sound policy nor consistent with the principles of democratic accountability.”

White, who has announced her intention to leave office with President Obama, wrote the top Republicans on the Senate Banking Committee Monday to say that she would not bow to requests to delay finalizing any rules, saying that the agency would “exhibit a spirit of firm independence,” Reuters reported.

On Tuesday, however, Hensarling threatened that any rules finalized in Obama’s last month would be scrutinized and possibly overturned by the unified GOP government next year. Republicans will be able to overturn late-finalized rules using the Congressional Review Act, which allows for expedited review of regulations in the Senate, bypassing the filibuster.

At issue are a number of rules, most notably derivatives reforms mandated by the 2010 Dodd-Frank financial reform law.