Dodd-Frank Act: The Volcker Rule

Section 619 of the Dodd-Frank Act - widely referred to as the Volcker Rule - places prohibitions and limitations on certain activities on the part of banking entities and nonbank financial companies. These activities are proprietary trading, as well as hedge fund and private equity fund ownership and sponsorship. We discuss the philosophy behind the Volcker Rule, objectives of the Rule, and the role of regulators in implementing the Rule.