Tuesday, July 14, 2009

Consumer Protection Legislation Delivered To Congress

On June 30, the Administration delivered to Congress a bill that would create the Consumer Financial Protection Agency("CFPA"). According to a statement by the Department of the Treasury, the agency contemplated by the bill will be charged with:
  • Looking out for American families when they take out loans or use other financial products or services – with a mission to promote access and Protect consumers from unscrupulous practices across the market.

  • Implementing and enforcing the new credit card bill signed into law by President Obama and Congress and have authority to combat the worst abuses in mortgage markets.

  • Promoting transparency, simplicity, fairness, accountability, and access – laying the cornerstone for the effort to fundamentally reform our system of financial regulation.
Under this legislation, the CFPA would look out for consumers, protecting them against unscrupulous practices and provide them increased access to efficient and innovative markets by:
  • bringing together fragmented responsibility for consumer protection;

  • Monitoring for risks, with a focus on risks to consumers;

  • Weighing benefits and costs of new regulation on access to credit and burden on financial institutions;

  • streamlining and consolidate regulatory requirements, acting as a single point of contact for consumer protection.
The CFPA would be structured to be independent and accountable, with a stable source of funding. The director of the agency would be appointed by the President and confirmed by the Senate, and the agency will be governed by a board, with one seat on the board reserved for a federal prudential regulator.

The full text of the proposed Consumer Financial Protection Agency Act of 2009 is available via the following links: