Now the very financial institutions that benefited from the billions of dollars in taxpayer bailouts are investing millions of dollars to kill reforms to fix our financial system. At the top of their hit list is, not surprisingly, the CFPA. It’s now up to Congress to make sure these institutions aren’t allowed to profit from their reckless behavior. The big banks would like nothing more than to strike down legislation that would protect Americans from the kind of abusive practices that triggered our current economic crisis.
But simply creating the CFPA isn’t enough. It is also up to Congress to make sure the CFPA is effective and has the necessary authority and resources to protect consumers. The CFPA should have primary rule writing, examination and enforcement authority that apply to both banks and non banks. Without the proper authority and resources, the CFPA won’t be able to accomplish all that we need it to do.
It’s also important for Congress to make sure the CFPA covers all financial products and activities like credit cards, savings accounts, payment products and the providers of these products and services. On a daily basis, consumers are inundated with slick ads and financial offers that seem too good to be true. Unfortunately, these offers often are too good to be true and there is no regulatory government body to police these tricks.
Finally, states need to have full authority to enact stronger consumer protection laws that enhance and expand the minimum federal standards set by the CFPA. Each state knows their individual needs the best, so states should have the power to change and add to the CFPA’s rules and regulations.
Congress needs to make sure history does not repeat itself. Americans deserve to have safe financial products and a robust broader economy. The Senate must act now to create a robust, fully empowered CFPA.