March 5 (Bloomberg) -- U.S. House Financial Services Committee Chairman Barney Frank said he wants to see people prosecuted for wrongdoing related to the financial crisis as lawmakers overhaul regulation of Wall Street.

Frank will call on attorneys general, bank regulators and officials from the U.S. Securities and Exchange Commission to outline plans for prosecuting and recovering funds from those responsible for the crisis, he said today at a news conference in Washington.

“What are your plans to prosecute those people whose irresponsible and, in some cases, criminal actions helped bring about this crisis?” said Frank, a Massachusetts Democrat.

Congress is planning the biggest overhaul of U.S. financial- industry regulation since the 1930s after companies reported almost $1.2 trillion in writedowns and credit losses since the subprime mortgage market collapsed in 2007. Frank said his committee will examine whether law enforcement agencies have sufficient tools to fight fraud, and will advance legislation aimed at curbing abuses in credit-card and mortgage lending.

“I do want all these people with enforcement powers, state and federal, in that room outlining what their plans are to do these recoveries,” Frank said about the March 20 hearing.

“We want to know what proposals there are to recover funds from people who caused this loss of taxpayer dollars and investor dollars,” Frank said.

‘Restrain Risk-Taking’

Frank, 68, said he wants to know whether agencies have enough staff to investigate wrongdoing.

Frank “has the bully pulpit and it sounds like what he’s trying to do is to make sure that each of these enforcement agencies are doing everything they can do in their power to bring people to the bar of justice,” Cornelius Hurley, director of the Morin Center for Banking and Financial Law at Boston University, said today in a telephone interview.

Frank said he’ll pursue reforms of U.S. rules overseeing Wall Street.

“We have got to empower some entities that don’t now have it to restrain risk-taking that is irresponsible,” Frank said, adding that the Federal Reserve is in the “best capacity” to serve this role.

The systemic-risk regulator should have authority to limit securitization, unwind failed institutions that aren’t insured banks, curtail excessive leverage and reform executive pay rules to curb “perverse” incentives that promote risk-taking.

“Too much executive compensation took the form of people making extra money if a bet paid off and losing nothing if the bet disastrously failed,” Frank said.

Frank said he plans to advance to the House floor a “tougher version” of legislation that stalled in Congress last year, to curb “irresponsible” subprime-mortgage lending. Securitization, or packaging loans and selling them to investors, “was a large part of the problem,” he said. He plans to “make it illegal for anybody to securitize 100 percent of anything.”

To contact the reporter on this story: Alison Vekshin in Washington at avekshin@bloomberg.net.

Last Updated: March 5, 2009 15:35 EST