What is The Dodd Frank Act?

Welcome to the Investors Trading Academy talking glossary of financial terms and events.
Our word of the day is “Dodd-Frank”
The term Dodd-Frank refers to a comprehensive and complicated piece of financial regulation born out of the Great Recession of 2008.
The full name of the bill is the Dodd-Frank Wall Street Reform and Consumer Protection Act, but it is better known and most often referred to as Dodd-Frank.
In simple terms, Dodd-Frank is a law that places major regulations on the financial industry. It grew out of the Great Recession with the intention of preventing another collapse of a major financial institution like Lehman Brothers.
Dodd-Frank is also geared toward protecting consumers with rules like keeping borrowers from abusive lending and mortgage practices by banks.
It became the law of the land in 2010 and was named after Senator Christopher J. Dodd and U.S. Representative Barney Frank, who were the sponsors of the legislation. But not all of the provisions are in place and some rules are subject to change, as we'll see.
The bill contains some 16 major areas of reform and contains hundreds of pages, but we will focus here on what are considered the major rules of regulation.

By Barry Norman, Investors Trading Academy - ITA