(Reuters) - White House economic adviser Paul Volcker firmly opposes exempting banks from his proposed 'Volcker rule' when they make only small, or 'de minimis,' investments in hedge funds or private equity funds, according to a letter obtained by Reuters on Tuesday.
"I absolutely oppose any such modification" of the U.S. Senate's Wall Street reform bill, Volcker wrote in the May 17 letter to Senate Banking Committee Chairman Christopher Dodd, head of the Senate's negotiating team going into conference committee talks this week with the U.S. House of Representatives on financial reform.
The Senate approved its reform bill -- without the 'de minimis' exemptions being sought by big banks -- on May 20.
The Volcker rule, as proposed in January by Volcker and President Barack Obama, would curb "proprietary trading" by banks for their own accounts unrelated to customers' needs, and their sponsorship of hedge funds and private equity funds.