The Patriot Post® · In Brief: If Barney Frank Were a Republican...
The collapse of Silicon Valley Bank and Signature Bank dominated news early last week. One prominent figure, however, did not dominate headlines, and that is Barney Frank. Jim Geraghty says the reason is obvious: Frank is a Democrat.
Picture, if you will, a 16-term congressman who plays a major role in overhauling the nation’s regulation of banks. He then retires and joins the board of directors of a New York-based national bank traded on NASDAQ, a bank with assets of about $50 billion. As a former congressman and member of the bank’s board, he lobbies Congress to loosen the rules for banks like his, making the not-insane argument that the rules for a bank with about $50 billion in assets shouldn’t be the same as the rules for a bank with $1 trillion or more in assets.
Imagine that while this congressman was still serving in the legislature, he denounced two of his former staffers who had gone to work as lobbyists for banks, saying of one of them, “It never occurred to me that he would jump so quickly from the committee staff to an industry that was being affected by the committee’s legislation. When he called me to tell me that he was in conversations with them, I told him that I was disappointed.” The congressman instructed his current staffers not to talk with former staffers who had gone to work for banks. But this congressman sees nothing wrong with himself going to work for a bank, and urging his colleagues to vote a particularly way on additional bank-regulation reforms.
Imagine that two years after the congressman joined the bank’s board, the New York state attorney general put the congressman’s bank atop her list of banks that loaned the most money to the landlords on the state’s Worst Landlords Watchlist.
Imagine that the bank’s former director — a former senator from New York — warned that the bank was getting too heavily involved in cryptocurrency and taking its “eyes off of that small entrepreneur.”
Imagine that the congressman’s bank came under the scrutiny of the U.S. Department of Justice and Securities and Exchange Commission, over concerns that the bank didn’t take sufficient steps to detect potential money laundering by clients, such as scrutinizing people opening accounts and monitoring transactions for signs of criminality.
Imagine that a former executive claimed that employees at the congressman’s bank kept their jobs despite being accused of a $1 million wire-fraud scheme.
Imagine that the New York State Department of Financial Services suddenly took possession of the congressman’s bank, making it the third-largest bank to fall into financial failure in U.S. history.
Then, imagine that in an interview with the Financial Times, the congressman explained why he joined the failed bank’s board of directors: “I need to make some money.” The congressman received nearly $2 million in cash for serving on the bank’s board over the past eight years, for what is characterized as “a (very) part time gig.”
But you don’t have to imagine anything in that scenario, because all of that really occurred with Barney Frank, the former Democratic congressman from Massachusetts and co-architect of the Dodd-Frank Act, who went on to serve on the board of the now-shuttered Signature Bank.
Geraghty goes on to explain a number of things about Frank and the fallout from his bank’s collapse. And that includes making the classic understatement: “If Barney Frank were a Republican, he would be the face of the current banking crisis.” However, “Barney Frank was a Democrat, and thus he had to be one of the good guys.”