President of fastest-growing labor union condemns "closed-door" changes to longstanding rules designed to protect consumers

WASHINGTON,DC - Andy Stern, International President of the 2-million memberService Employees International Union (SEIU)--the fastest-growing laborunion in the Americas--issued the following statement today regardingrule changes by the Federal Reserve that make it easier for privateequity firms to invest in the nation's retail banks:

Ifnothing else, this week's financial crisis should have sent a strongmessage to Washington: The time for back-room deals and lax regulationis over.

Instead, federal regulatorsremain out of step with the rest of the country. At the very momentAmericans both rich and poor are recognizing the critical need forimproved oversight, total transparency, and stronger rules that protecttaxpayers, consumers, and the economy, the Federal Reserve has chosento move in the exact opposite direction.

Byeasing longstanding rules restricting the influence and level ofinvestment private equity firms can make in the country's retail banks,the Fed has taken steps that expose taxpayers to the kind of riskypractices and profiteering that led to the meltdown on Wall Street inthe first place. Even worse, the changes were made behind closed doors,without a "notice and comment period" to permit the general public toweigh in on the deal.

That's the wrong move at the wrong time for our economy.

Privateequity firms like TPG, Kohlberg Kravis Roberts (KKR), and the CarlyleGroup have staked their reputation on making major profits in a shortperiod of time by taking big risks and exploiting insufficientregulation. Allowing secretive, unregulated private equity firms to owna bigger stake and a greater say in the nation's banks now will onlyensure less stability for our financial institutions--and permitconflicts of interest in the future.

Workingfamilies have paid far too much already for the economic crisis.Congress should call on the Fed to immediately stop making rulechanges--and start putting the long-term safety and soundness of ourfinancial system ahead of the self-interested demands of buyout firms.

For more information, visit www.bigbadbanks.org.

"

###