Sellers of bonds backed by mortgages, auto loans, and commercialbuildings will have to give investors more details to judge thequality of loans they have packaged under rules approved today by the U.S. Securities and ExchangeCommission (SEC).

The SEC's five commissioners unanimously approved rules mandatedby the Dodd-Frank Act after investors were burned by soured debtsold by Wall Street before the 2008 credit crisis. The newrequirements apply to the $750 billion market for privatemortgage-backed securities, which imploded in 2008 and financedjust 1 percent of new mortgages in 2013.

Banks eligible to expedite sales of asset-backed bonds withminimal SEC review will have to provide an executive'scertification that documents given to investors are accurate. Theyalso will have to provide a process to review soured assets todetermine whether they should be repurchased.

“The reforms before us today will add critical protections forinvestors and strengthen our securities markets by targetingproducts, activities, and practices that were at the center of thefinancial crisis,” SEC Chair Mary Jo White said in a statementbefore the vote. “Investors will have powerful new tools forindependently evaluating the quality of asset-backed securities andcredit ratings.”

Copyright 2018 Bloomberg. All rightsreserved. This material may not be published, broadcast, rewritten,or redistributed.