You won’t believe how the co-author of one of America's biggest banking regulations cashed in

Recently, the financial services company Signature Bank announced the appointment of a prominent new board member.

Perhaps to the surprise of some, the individual receiving the board seat was none other than the co-author and namesake of one of the nation's largest and arguably most significant pieces of banking regulation since the Great Depression, former Massachusetts Democratic Rep. Barney Frank.

House Financial Services Chairman Barney Frank, D-Mass., center, and House Speaker Nancy Pelosi, D-Calif., left, Secretary of the Treasury Henry Paulson, 2nd right, and Senate Majority Leader Harry Reid, D-Nev., right, announce a tentative deal regarding on the financial crisis on Sunday, Sept. 28, 2008 on Capitol Hill in Washington. (AP Photo/Lauren Victoria Burke)

How much can Frank expect to earn for his services?

Fortune writes that Signature's non-employee board members earned approximately $375,000 in cash and stock for their services last year. Rep. Frank was reportedly also granted restricted shares vesting in March 2016 with a current market value of approximately $280,000.

In a statement from the Chairman of Signature Bank Scott Shay included in the press release concerning the Frank appointment, Shay said:

We are gratified to welcome Barney to the board, which is particularly engaged and energetic. We specifically seek members whose deep and broad experience will prove impactful to the Bank; those who share diverse perspectives and possess strong decision-making capabilities. These characteristics are what help foster the continued success and growth of Signature Bank amid the complicated economic environment in which we compete and truly define the personality of our current board. With a 32-year career devoted to government and his distinguished expertise in financial services, we believe Barney will be an asset to the board, bringing keen insights, far-reaching industry knowledge and vast intellect to his role as well as to our institution and the Bank's shareholders.

Frank is just the latest in a series of government officials to have worked on the Dodd-Frank bill only to then leave government for the private sector and work in the financial services industry or tangentially related areas.

As Peter Schewizer -- he of "Clinton Cash: The Untold Story of How and Why Foreign Governments and Businesses Helped Make Bill and Hillary Rich," -- chronicled in a 2013 book titled "Extortion: How Politicians Extract Your Money, Buy Votes, and Line Their Own Pockets," "the indecipherable Dodd-Frank law" proved lucrative for many "members of the Permanent Political Class who actually wrote it."

Schweizer writes:

Amy Friend was a chief aide to Senator Chris Dodd in crafting the Dodd-Frank financial reform bill and served as the chief counsel to the Senate Banking Committee. After the bill passed and became law, she left Capitol Hill and became a managing director at Promontory Financial Group, which describes itself as "a premier global financial services consulting firm." This Washington-based consulting firm is headed up by many people like Friend -- people who were once responsible for erecting or interpreting arcane financial regulations in public service and then joined the group, where they can charge high fees to help firms interpret and comply with these befuddling regulations. The firm is a "major power broker in Washington," says the New York Times, "helping Wall Street navigate an onslaught of new rules and regulatory scrutiny" (many of those rules having been written, of course, by those now working at Promontory). Banks complain about Promontory's high fees, which can run $1,500 an hour. Eugene Ludwig, the former comptroller of the currency under Bill Clinton, reportedly makes $30 million a year running Promontory. He lives in one of the most expensive houses in Washington, a 13,000-square-foot home on a three-acre estate.

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When Ludwig announced that Amy Friend was joining his firm, he boasted about the fact that Friend had played a key role in shaping the Dodd-Frank bill and that at Promontory she would help clients with the "regulatory implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which at 2,300 pages, is one of the most complex and wide-ranging overhauls of the financial regulatory framework in decades."

But Friend was just one of many who crafted the convoluted bill, left government, and now command large fees from firms trying to make sense of it. Daniel Meade was the chief counsel on the Financial Services Committee under Chairman Barney Frank (the Frank of Dodd-Frank). Meade left Capitol Hill for Hogan Lovells, a well-established lobbying firm. When Meade arrived, the firm Hogan Lovells announced that Meade was "a principal draftperson of substantial portions of the Dodd-Frank Wall Street Reform and Consumer Protection Act." The firm's publicity explained that Meade would be "representing financial services entities and other entities impacted by the regulation of those entities in connection with a broad range of regulatory and transactional matters, including issues related to the Dodd-Frank Act." It makes all the sense in the world: if you can't understand a complex new legal regime, who better to help guide you than one of the people who drafted it?

... One of the most confusing sections of the Dodd-Frank Act concerns options and commodity trading. In the months after the law passed, at least nine employees of the Commodity Futures Trading Commission (CFTC) who helped write that section and establish its regulatory provisions left for lucrative jobs, helping large firms figure out how to comply. They went to positions at JP Morgan Chase, Deutsche Bank, Nomura Securities, PricewaterhouseCoopers, and the white-collar criminal defense law firm Covington & Burling. These firms either are subject to the confusing Dodd-Frank rules or advise other firms on how to comply with them.

Politicians of both parties leaving office to work in the financial services industry is of course nothing new.

Former House Majority leader Republican Eric Cantor joined the boutique investment bank Moelis & Company following his defeat in the 2014 GOP primary defeat.

More recently, former Massachusetts Democrat Governor Deval Patrick joined the private equity firm Bain Capital famously co-founded by 2012 Republican presidential nominee Mitt Romney.

Nevertheless, former Rep. Frank's move is most notable given his long legislative experience in the financial services space, from oversight of the government sponsored entities Fannie Mae and Freddie Mac, to his landmark Dodd-Frank bill.

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