FSOC

FSOC stands for the Financial Stability Oversight Council, a United States interagency body created by the Dodd-Frank Wall Street Reform and Consumer Protection Act in 2010. It was established to identify risks to the U.S. financial system and to coordinate regulatory responses to emerging threats to financial stability.

The council's core responsibilities include identifying systemic risks, enhancing regulatory coordination, and, when necessary, designating nonbank financial companies and financial market utilities whose distress could pose a risk to the financial system. Designations bring these entities under enhanced supervision by the Federal Reserve and other regulators and can trigger requirements for resolution planning. The FSOC also relies on the Office of Financial Research to collect and analyze data and to provide analytic support for its work. The council can request information from financial firms and coordinate among member agencies and international authorities.

Membership and structure are described in its statutory framework. The voting members include the Secretary of the Treasury (who serves as chair) and the leaders of the major U.S. financial regulatory agencies. The Office of Financial Research director serves as a nonvoting member, and other regulatory agencies participate as nonvoting members as defined by statute. The exact composition has evolved with changes in law and policy over time.

Impact and oversight: FSOC meets to assess emerging risks, review regulatory gaps, and issue annual reports on the state of financial stability. Supporters view it as increasing regulatory visibility of systemic risk, while critics argue it can concentrate regulatory authority and impose additional burdens without sufficient transparency.