The Dodd-Frank Wall Street Reform and Consumer Protection Act established the Financial Stability Oversight Council (FSOC), which is charged with identifying risks to the financial stability of the United States, promoting market discipline, and responding to emerging threats to the stability of the U.S. financial system. The FSOC has the authority to designate certain nonbank financial companies as "systemically important," which means that their material financial distress—or the nature, scope, size, scale, concentration, interconnectedness, or mix of their activities—could pose a threat to U.S. financial stability. Such companies will be subject to consolidated supervision by the Federal Reserve and enhanced prudential standards¹.