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Fed’s Stress-Test Champion Reshapes Regulation of Biggest Banks

Not long after President Barack Obama picked Daniel Tarullo for a seat on the Federal Reserve Board, he sat down for the standard briefing with the staff and promptly turned the tables on them.

Tarullo told them they had made mistakes in supervision, and he wouldn’t defend their past actions. Later, he told Richard Shelby, the leading Republican on the Senate Banking Committee, he endorsed Shelby’s view that regulators had fallen down. He said it was time to “reshape” regulation.