Chapter 3 : Failure of, and Un-Constitutionaility of the 'Restoring American Financial Stability Act' of 2010 ('Rafsa')

Abstract

RAFSA is critical and worth examining because it was the first set of statutes in any country, that attempted to simultaneously address the Global Financial Crisis, the securities law framework in the US, the structure of the executive branch of the US federal government, and delegation of powers to federal government agencies (to the detriment of state governments). Furthermore, the effects of RAFSA will be felt in many countries because US investment banks are very active in many foreign markets, many foreign investors own US securities, and mnay foreign companies are listed in US stock exchanges. In July 2010, the US Congress enacted the Restoring American Financial Stability Act of 2010 (RAFSA) , which consists of several individual distinct statutes and substantially changes the nature and effects of Federalism and preemption in the US – the RAFSA grants more powers to the federal government to regulate more financial services, but because the statute leaves critical details up to the US SEC and the US Federal Reserve System, sections of the RAFSA may be challenged in court on constitutional grounds as void for vagueness.