Finance laws and regulations cover all aspects of the financial world. These are divided into several categories: rules, laws, and enforcement. Enforcement is the process of taking action against a bank or other financial institution that violates the law. While it may not always be possible to get the punishment you deserve, a credible threat of enforcement is sufficient to keep bad actors from operating in the financial services industry. Resolution, on the other hand, is the process of winding down a financial institution. It aims to minimize the damage to the economy.
Financial law has several purposes. The primary purpose of financial law is to allocate risk to the various parties. It focuses on the sale of goods and services. There are five different types of market structures, which are classified according to the credit risk of the risk taker. This article will cover the three major categories of financial law. It will also provide an overview of each category. Here, we will examine some of the key aspects of finance laws and regulations.
In United States
In the United States, there is a consumer financial protection bureau under the Treasury Department. Its goal is to protect consumers by ensuring that banks do not overcharge them and verify their income. Regulatory bodies oversee banks. The Glass-Steagall Act was passed in 1933 after the stock market crash in 1929. However, in 2005, the Gramm-Leach-Bliley Act was passed and regulated the banking industry. This law allowed banks to invest in hedge funds and derivatives that were unregulated at the time.