Administration Is Near Finance Overhaul Plan

WASHINGTON — Washington is asking some painful questions about how to prevent the next financial meltdown. Should it reinvent the Federal Deposit Insurance Corporation? Abolish the seemingly feckless overseer of savings and loans? Grant new powers to the Federal Reserve? All that — and more — is on the table as the Obama administration prepares to overhaul the regulatory apparatus that failed to prevent the gravest economic crisis since the Depression. Under consideration is a new agency to regulate mortgages and credit cards, as well as tighter federal oversight of hedge funds and insurance. One possibility is creating a regulator to watch over companies that might put the financial system in peril again should they run into trouble.The plan, a central plank of the administration’s response to the current crisis, has already provoked a fierce lobbying battle by the various financial services industries that it could touch. The Treasury Department aims to complete the effort by mid-June, and senior Democrats in the House and Senate have vowed to complete legislation by the end of this year.