MercoPress. South Atlantic News Agency

US Senate approves sweeping overhaul of financial regulations

Obama: never again will US taxpayers pick the bill for Wall Street mistakes

The US Senate passed a bill Thursday providing the most sweeping overhaul of financial regulations since the 1930s. The Senate passed the bill by 59 votes to 39. It must still be merged with a version in the House.

The bill creates new ways to watch for financial risks and makes it easier to liquidate large failing firms.

President Obama said Americans would never again pay “for Wall Street's mistakes” adding that Wall Street had tried but failed to scupper the bill.

The bill will create a new watchdog agency and will reform the complicated derivatives market.It will increase restraints on larger banks and require proof from borrowers that they can pay back even the most basic of mortgages.

Democratic Party Senate Majority Leader Harry Reid said: “To Wall Street it says 'no longer can you recklessly gamble away other people's money'.”The bill must still be reconciled with a version passed in the House of Representatives in December.

But Barney Frank, head of a key House panel, said that he thought Mr Obama might be able to sign a bill into law before the 4 July holiday.

The president earlier said the financial industry had repeatedly tried to block the regulatory reforms, using lobbyists, millions of dollars in advertising and special interest “loopholes”.

“Today, I think it is fair to say these efforts have failed,” he said, in a statement in the Rose Garden of the White House.

The bill's progress had been stalled by some Republican leaders who did succeed in making some amendments. Republican Sen Richard Shelby, who opposed the legislation, said: “The decisions we've made will have an impact on the lives of Americans for decades to come.

”Judgment will not be rendered by self-congratulatory press releases, but, rather, by the marketplace. And the marketplace does not give credit for good intentions.”

On Wednesday Republicans, aided by two Democrats, had blocked a final Senate vote on the bill. However, on Thursday a vote to end debate on the bill was passed by 60-40, the minimum needed to succeed.

There is widespread public support for tightening the regulation of Wall Street.