Six million foreclosures and 10% unemployment. Stocks were down 50%, major banks collapsed, and the lending landscape cooled.
The financial crisis of 2008 was brutal and most observers believe it was largely preventable. In view of this, Congress set out to ensure that nothing of its scale ever happened again. Former Massachusetts representative Barney Frank, who died on May 19, was one of the key leaders of those efforts.
The Dodd–Frank Wall Street Reform and Consumer Protection Act, later referred to simply as “Dodd–Frank”, took more than a year to write and was finally signed into law in July 2010. Its purpose was to strengthen banks so that they would not need to turn to the government for bailouts, and to protect consumers of financial products and services. To some extent, the law also established some guardrails around the financial markets to protect investors.
What did Dodd-Frank do for consumers?
“The lead-up to the passage of Dodd-Frank, what was manifested in the 2008 crash was that there was an ability for people to take advantage of financial services and products,” said Pamela Fuhi, a professor at the University of Georgia School of Law who specializes in bankruptcy and consumer finance.
Dodd-Frank created the Consumer Financial Protection Bureau in a primary way, which tried to fill a gap in the regulatory landscape.
“Many federal agencies had light regulatory power over things that I thought had the potential to have a big impact on people’s lives, but there wasn’t a single place that was designed to think about the financial products people use on a daily basis and those financial service providers that didn’t have consumers’ best interest in mind,” Fuhey told USA TODAY.
Fuhe believes that the CFPB was designed to facilitate interactions between consumers and financial service providers, not to act as a disciplinarian. One of the most notable ways it does this is through its complaint portal, which allows consumers to lodge complaints which the bureau forwards to the subject for response.
As an example, the CFPB reports that in 2025, it “received more than 6.6 million complaints and sent more than 5.9 million to companies for review and response. Of those complaints sent to companies, the Bureau forwarded 97% to a company within a day or less. In turn, companies provided timely responses to more than 99% of complaints sent to them for review and response.”
Fuhe considers the CFPB a success, even though it has struggled to remain open since it opened, particularly under the current Trump administration, which has largely gutted its staff and restricted its activities.
“The Bureau has made significant progress and steps forward in identifying practices that have been overlooked in consumer lending that don’t help people succeed,” Fuhey said. Those practices included predatory mortgage lending, junk fees, misleading jargon on financial product descriptions, payday loans and more.
However, the CFPB is disliked by businesses, financial institutions, and many Republican politicians.
Trump told reporters in February 2025 that his administration was “trying to get rid of waste, fraud and abuse” and that he wanted to eliminate the agency. The American Bankers Association also previously told USA TODAY that it is “grateful for the efforts of Trump administration regulators, including the CFPB, to correct some of the prior administration’s overreach.”
What did Dodd-Frank do about banks?
Dodd-Frank also tried to deal with the issues that had brought some of the world’s largest banks to their knees in the financial markets collapse. One of its primary mechanisms was to require them to hold more capital, a move described as significant by Dennis Kelleher, co-founder and CEO of watchdog group Better Markets.
“Capital in banks functions similar to a down payment on a house,” Kelleher told USA TODAY. “When a bank loses money, they are supposed to have enough capital to absorb their losses, not fail. That’s what happened in 2008 and that’s why they were bailed out. But in reality bailouts are nothing more than taxpayers giving banks capital after they go bankrupt.”
Dodd-Frank has been less successful in this regard: three medium-sized banks collapsed in 2023. Kelleher says this is due to one of the law’s major failures: It left 400 rules for different regulators to write and enforce.
“When it did not defeat Dodd-Frank in Congress, the financial industry moved its army of lawyers and lobbyists into the regulatory arena to try to defeat what it could not defeat in the legislative arena,” he said.
What’s left behind is a much weaker law, which faces even greater erosion as the Trump administration takes more steps to weaken the rules. For example, the Securities and Exchange Commission has taken a lighter approach with cryptocurrency companies, and recently allowed publicly traded companies to report earnings twice a year instead of four.
“Markets are being largely deregulated,” Kelleher said. “They have stopped enforcement, and so financial predators can provide less information to investors and rob them more often.”
Fuhi believes that too many rollbacks are self-defeating. “The purpose of Dodd-Frank, which I don’t want to lose, was to help the economy and the people in it, to make more money for anyone.”