UPDATE 1-Obama pushes bank reform, lashes out at Republicans

* Obama says bill will end taxpayer bailouts

* Criticizes top Republican for “deceptive” statements

* Republicans say Obama ignoring facts in his criticism
(Adds Republican spokesman, background)

By Ross Colvin

WASHINGTON, April 17 (BestGrowthStock) – U.S. President Barack
Obama accused opposition Republicans on Saturday of spreading
misinformation about a Democratic bill that aims to tighten
oversight of Wall Street banks and their practices.

With debate heating up in Washington about reforming the
financial rules, regulators charged Wall Street giant Goldman
Sachs (GS.N: ) with fraud on Friday. [ID:nN16131161]

Bank shares and the broader stock market fell on fears the
civil lawsuit could make it more difficult for the financial
industry to ward off reform.

After successfully shepherding his healthcare overhaul
through Congress, Obama is pushing for victory on the financial
regulatory reforms — a popular issue with voters in the run-up
to congressional elections in November after a financial
meltdown sparked the worst U.S. recession in decades.

The Senate is expected to vote within weeks on the reform
bill, which Obama said would “hold Wall Street accountable” and
put rules in place to prevent any more taxpayer-funded bailouts
of companies in trouble.

“Never again will taxpayers be on the hook because a
financial company is deemed ‘too big to fail’,” Obama said in
his weekly radio and Internet address.

Under the controversial Troubled Asset Relief Program
launched by the Bush administration, $700 billion was set aside
to help major financial firms and automakers, including AIG
(AIG.N: ), Bank of America (BAC.N: ), Citigroup (C.N: ), JPMorgan
Chase (JPM.N: ), Morgan Stanley (MS.N: ) (Read more about the money market today. ) and Goldman Sachs.

Republicans insist the Democratic bill will lead to more
taxpayer-funded bailouts and say it establishes new regulatory
powers that will stifle small businesses and community banks.

All 41 Republicans in the 100-seat Senate expressed their
opposition to the bill in a letter on Friday but said they were
willing to work with Democrats on the issue.

Obama said he still hoped to win Republican support for the
bill but lashed out at Republican Senate leader Mitch
McConnell, accusing him of making a “cynical and deceptive
assertion that reform would somehow enable future bailouts —
when he knows that it would do just the opposite.”


The bill proposes setting up a $50 billion fund to pay for
liquidating distressed financial firms, a measure not favored
by the White House. Republicans have said the fund presents the
possibility of continued bailouts.

Senate Democrats were reported to be considering dropping
the controversial proposal after the main sponsor of the bill,
Senate Banking Committee Chairman Christopher Dodd disowned the
fund, saying it was proposed by Republicans and community

Republicans hit back at Obama’s criticism of McConnell.

“It’s especially disappointing for the president to attack
Senator McConnell for raising concerns about the bailout
loopholes in the bill when just last night the White House
agreed with Senator McConnell and its own treasury secretary
and asked Senate Democrats to remove the $50 billion fund,”
McConnell’s spokesman, Don Stewart, said on Saturday.

“Senator McConnell takes the president at his word that he
wants a bill that does not expose taxpayers to future bailouts
and will not destroy job creation. And we are committed to
working with anyone willing to achieve that.”

With control of the Senate and House of Representatives at
stake in the November election, Democrats and Republicans are
keen to tap into the anger felt by many Americans against Wall
Street firms in the wake of the financial crisis. Reining in
Wall Street would be a popular move with voters.

“What is clear is that this crisis could have been avoided
if Wall Street firms were more accountable, if financial
dealings were more transparent, and if consumers and
shareholders were given more information and authority to make
decisions,” Obama said in his weekly address.

He said the reforms would achieve the goals of transparency
and protection, while closing loopholes that had allowed some
firms to take huge risks that threatened the whole economy.

The Obama administration has taken a more aggressive stance
on Wall Street since the Democrats lost a Senate seat in
Massachusetts in January. The election highlighted voter
resentment against big banks and big bonuses.

Stock Investing

(Editing by John O’Callaghan)

UPDATE 1-Obama pushes bank reform, lashes out at Republicans