http://thehill.com/business-a-lobbying/91793-manufacturing-giants-aim-to-protect-industrial-banks
The Corporate Lobbyists are going to ensure the death of this country
Business giants General Electric, Toyota and dozens of others are on the verge of a major victory over President Barack Obama’s push to rein in their financial arms.
As part of its overhaul of the financial system, the Obama administration originally wanted to close what it considered a regulatory loophole. Federal laws do not typically allow banking and commerce to mix, with a notable exception: roughly 40 industrial loan companies (ILCs) chartered in a handful of states, primarily Utah and Nevada.
The administration’s proposal prompted a multimillion-dollar lobbying effort by some of the biggest names in corporate America, which feared new regulations would hurt their bottom line and choke off credit to their customers.
And while few critics, including the Cambridge center, allege the companies spurred the financial crisis, some firms have required federal intervention.
GMAC Bank, once an industrial loan company, faced mounting losses and in November 2008 moved to transform itself into a bank holding company in order to receive a bailout, according to the Congressional Oversight Panel over the $700 billion financial rescue package. Regulators approved the request in December 2008, and GMAC got billions of dollars in aid.
CIT Group, which had roughly $9 billion in assets in its loan company, made a similar conversion in 2008 and benefited from federal bailout efforts.
In mid-March, Utah banking authorities took over Advanta Bank Corp., which had $1.5 billion in assets, after finding it was insolvent and was not able to raise sufficient capital. The FDIC took receivership of the bank.
