On May 30, the Federal Reserve unveiled their proposed update to the Volcker Rule, which would give banks additional ability to make markets, hedge trades and make certain other investments. Milbank Financial Institutions Regulatory partner Douglas Landy, who helps some of the largest banks comply with the Volcker Rule, commented on the proposed changes in the recent New York Times article "Big Banks to Get a Break From Limits on Risky Trading." The Volcker Rule portion of the Dodd-Frank law was originally set in place to prevent banks from engaging in risky trading practices following the financial crisis. Regulators stated that the primary intent of the Volcker Rule would remain intact and that banks would not be allowed to return to risky trading practices. They also noted that these proposed changes were refinements based on the insight they received while overseeing the process on implementing the Volcker Rule, and that the changes would be open to public comment before being finalized. Mr. Landy stated, "For people who are saying 'you're going too easy on the banks,' their rejoinder is 'we have data saying that's not true'" and notes, "It's the type of language you might not see in a Fed report before the financial crisis or Dodd Frank when they weren't as aware of the political implications."
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