“This is a symbolic victory for the House Republicans,” said Sean Tuffy, who oversees global regulatory intelligence at Brown Brothers Harriman. “The Senate’s been pretty clear that they’re going to pursue financial regulatory reform, but on their own terms.”

The Choice Act represents the second major piece of legislation the House has passed that will have little chance of becoming actual law. GOP lawmakers celebrated the passage of the American Health Care Act in early May even though that too is likely to see substantial changes.

In the House version, regulatory reform would see the elimination of a process set up to unwind financial institutions that become deemed too big to fail because of their interconnectedness.

The CFPB also would be reconstituted and renamed, with the director appointed by the president and the agency losing much of its power.

Opponents have labeled it the “Wrong Choice Act,” with Rep. Maxine Waters, D-Calif., calling it “one of the worst bills I have seen in my time in Congress.”

“This bill would pave the way back to economic damage of the same scale (as the financial crisis), or worse,” Waters said in a statement.

While critics acknowledge that Dodd-Frank has gone too far and imposed a costly regulatory burden on banks, they believe the Choice Act goes too far in the other direction.

“Dodd-Frank is just overly complex and burdensome. For the purpose of making the financial system safer, you can do a lot more of that with less complex and less burdensome regulation,” said Kim Schoenholtz, director of the Center for Global Economy and Business at NYU’s Stern School of Business.

“But the Choice Act, while reducing the burden, actually makes the system less safe, and that’s not an attractive choice.”

Schoenholtz believes the “off-ramp” is a mistake for banks that raise certain levels of capital to escape the more onerous regulatory provisions. Other weaknesses he cited include eliminating the liquidation fund to unwind too-big-to-fail banks and removing various designations used when determining the level of regulations banks will face.

The Senate is expected to gear its changes primarily toward helping community and regional banks and is unlikely to scrap the Volcker rule, a provision that prevents banks from trading for their own profit with customer money.

— Reuters contributed to this report.

Watch: What the CHOICE Act would mean for Wall St.

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