Dodd-Frank: Resolution or Expropriation?

Abstract

The 2010 financial reform law provides a summary procedure whereby the government can take over and liquidate a non-bank financial company if the Treasury Secretary decides it is in danger of a default with serious adverse economic consequences. The Constitution requires due process of law for the seizure of property, and this note describes the procedure provided. It is so truncated and minimal as to raise considerable doubt that it is valid under all prior standards.