“Industry regulation resembles an exercise in archaeology or geology. Not only are many products and activities regulated, there is also layer upon layer of regulatory documents. Some layers can be more significant than others. And others can be mistaken for, or misrepresented as, something they are not.
Some layers are laws. When Congress passes an act and the President signs it, the resulting law contains provisions that require or prohibit certain actions—or set limits. Once something becomes a law, it defines the borders of what banks can or cannot do.
Laws tend to be vast—and often vague—in addressing specific problems or activities.
For example, it is one thing to require disclosure of finance charges. It is quite another to figure out precisely what constitutes a finance charge. It is one thing to require reporting of suspicious activity. It is quite another to figure out what constitutes suspicious activity and how the report should be prepared and filed.
This is where regulations come in.”
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