Administration Plans Limits on Institutions 'Too Big to Fail'

Congress and Obama administration officials are planning to introduce legislation this week to rein in companies so large that the government has no choice but to rescue them from financial trouble, the New York Times reported Monday. The Times says the proposed legislation would "make it easier for the government to seize control of troubled financial institutions, throw out management, wipe out the shareholders and change the terms of existing loans held by the institution."

Rep. Barney Frank, the chairman of the House Financial Services Committee, could introduce the bill this week after extensive consultations with Treasury Secretary Timothy Geithner. The new regulations would force companies to hold more money in reserve, prevent them from borrowing too heavily against their assets, and mandate the creation of "living wills" -- plans for disentanglement from the government in the event of a financial crisis.