Ghosts of 2008 Haunt SEC’s ‘Outsider’ Pushing Tough Rules

As the Securities and Exchange Commission worked overtime to finish the Volcker Rule last year, a new arrival warned her colleagues they were botching one of the key parts of the new U.S regulatory machine.

Commissioner Kara M. Stein, who had recently moved to the SEC after a career on Capitol Hill, said the text was full of potential loopholes for banks to dodge the ban on proprietary trading. She let it be known she might vote against it, bottling up the rule and embarrassing SEC Chair Mary Jo White.