President Barack Obama said on Friday he would veto a planned financial regulation law that did not bring the derivatives market under control -- hours after influential bank Goldman Sachs was charged with fraud.
Obama, during a meeting with outside economic advisers, said he hoped Congress would pass a bipartisan bill to regulate the financial sector.
I will veto legislation that does not bring the derivatives market under control and some sort of regulatory framework that assures that we don't have the same kind of crisis that we've seen in the past, Obama said.
His comments came after Goldman Sachs was charged with fraud by the Securities and Exchange Commission over its marketing of a debt product tied to subprime mortgages.
The lawsuit is the biggest crisis in years for Goldman, which emerged from the global financial crisis as Wall Street's most influential bank.
Obama's fellow Democrats hope to take financial regulation legislation to the Senate floor in the coming weeks.
Obama said on Friday that passing the reforms would mean no more taxpayer bailouts for big financial firms. Republicans have charged that the bill would lead to more bailouts.
Chairman Blanche Lincoln unveiled the Senate Agriculture Committee's draft bill to regulate the $450 trillion over-the-counter derivatives market, taking a tougher tack against big banks than the Senate Banking Committee or House of Representatives.
The bill would require banks to spin off swaps desks if they are protected by federal deposit insurance or access the Federal Reserve discount window.
(Reporting by Jeff Mason and Ross Colvin; Editing by John O'Callaghan)