Reuters) - Three U.S. states have joined a lawsuit against federal regulators, challenging the constitutionality of the 2010 Dodd-Frank law that overhauled U.S. financial oversight and created the Consumer Financial Protection Bureau.
The attorneys general of Michigan, Oklahoma and South Carolina are challenging a portion of Dodd-Frank that empowers the Treasury secretary to order the liquidation of failing financial institutions, according to a complaint filed in U.S. District Court for the District of Columbia on Thursday.
The states joined a suit filed in June by conservative think tank Competitive Enterprise Institute, a Texas bank and a senior citizens group.
Dodd-Frank, passed by Congress in response to the 2007-2009 U.S. financial crisis, gives regulators broad authority to oversee financial institutions.
It has since drawn criticism from Republicans and industry groups who say the new regulations go too far and could strangle businesses and restrict credit. Republican presidential candidate Mitt Romney has pledged to repeal Dodd-Frank, but few see that promise turning into a reality.
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