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Bankruptcies: Joe Biden wants tougher penalties against perpetrators

As the American banking world is rocked by several failures, the president argues so Nobody is above the law And Tightening accountability has an important deterrent effect to prevent future cases of mismanagement.

Pointing out that the law today limits the ability of the administrative authorities to act, he believes that this should be the case Easier for regulators To punish the bankers financially.

Therefore, Joe Biden asks elected US officials to give more powers to the regulatory authorities, in particular the Deposit Insurance Agency (FDIC), which is the body that intervenes in the event of bank failure.

The American president would like this organization to be able to Claim Bonuses paid to violating bankers, imposing fines on them and banning them from working in this sector in the future.

It remains to be seen how his appeal will be received. The Democratic party, Joe Biden’s party, controls the Senate, but the other chamber of Congress, the House of Representatives, is dominated by the Republican opposition.

However, Republicans are generally hostile to any tightening of banking regulations.

Silicon Valley bank collapsed after depositors panicked and withdrew billions of dollars amid concerns surrounding the bank’s finances.

Photo: Associated Press/Jeff Chew

Joe Biden’s invitation to Congress comes after the US banking world was rocked by the collapse of the tech-related Silicon Valley bank and the Signature Bank disaster in New York.

On Thursday, a group of major US banks had to come to the aid of another institution, the First Republic, which is the new weak link in the system.

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This bailout did not reassure the markets for long, which were still quite overheated on Friday.