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Next Financial Crisis? We're Not Ready, Says Ex-SEC Commissioner 

November 4, 2015

Rhonda Schaffler, The Street

The U.S. isn't prepared for the next financial crisis, according to former SEC Commissioner Daniel Gallagher, who said the Dodd-Frank financial law enacted after the Great Recession should be thrown out and lawmakers should start over.

Gallagher left the SEC in early October after four years as a commissioner, and was a vocal critic about the law.

"Having lived with Dodd-Frank for many years now as an SEC commissioner, it's largely just a series of wish list items that were sort of pent up by certain special interest groups over the years. And when they saw the ability to not let a good crisis go to waste, they unleashed Dodd-Frank," said Gallagher.

The former commissioner said Dodd-Frank has been beneficial to large banks and insurance companies, and has been a barrier to entry for smaller firms, creating a lack of competition. But according to Gallagher, the bigger issue with Dodd-Frank is that it didn't address what actually caused the financial crisis that began in 2007. He believes Congress rushed to address the problem without looking closely at what caused it.

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