Special Section: Dodd Frank Financial Reform Legislation & State Insurance Regulation

Dodd-Frank Financial Services Regulatory Reform: NAIC Initiatives

Financial Stability Oversight Council (FSOC)

Title I of the Dodd-Frank Wall Street Reform and Consumer Protection Act created the Financial Stability Oversight Council (FSOC) to monitor the safety and stability of the nation’s financial system, identify risks to the system, and coordinating response to any threats. FSOC has the authority to identify financial firms, financial market utilities and systemic payment, clearing, or settlement activities whose failure could potentially pose a risk to the financial system.

Those identified entities, utilities, and activities are subject to more stringent regulatory standards under the Federal Reserve Board of Governors. The council also facilitates coordination and information-sharing among member agencies, departments and functional regulators.

Eric A. Cioppa, Superintendent of the Maine Bureau of Insurance, is the designated state insurance regulator representative serving on the FSOC. He represents the interests of the nation’s state insurance regulators, providing critical insurance regulatory expertise.

FSOC is composed of 10 voting members:

1. The Secretary of the Treasury (who also acts as FSOC Chair);
2. The Chairman of the Board of Governors of the Federal Reserve System;
3. The Comptroller of the Currency;
4. The Director of the Consumer Financial Protection Bureau;
5. The Chairperson of the Securities and Exchange Commission;
6. The Chairperson of the Commodities Futures Trading Commission;
7. The Chairperson of the Federal Deposit Insurance Corporation;
8. The Director of the Federal Housing Agency;
9. The Chairman of the National Credit Union Administration Board; and
10. An independent member with insurance expertise appointed by the President and confirmed by the Senate for a six-year term.

FSOC also has five non-voting members:

1. A state insurance commissioner selected by the state insurance commissioners (through the NAIC);
2. A state banking supervisor selected by the state banking supervisors;
3. A state securities commissioner selected by the state securities supervisors;
4. The Director of the Federal Insurance Office; and
5. The Director of the Office of Financial Research.