White House makes case for consumer protection agency

A Senate bill to overhaul Wall Street makes consumer protection a top priority that will prevent abusive and deceptive practices. 

The bill focuses on holding credit providers accountable so "they can't trap customers with misleading terms buried in the fine print," Jen Psaki, White House deputy communications director, said Friday on her blog. 

President Barack Obama has been "clear from day one that a consumer agency must be independent, with independent authority, funding, rule-writing and enforcement," she wrote.  

Republicans are playing "Whac-a-Mole" with financial reform and the bill isn't about regulating dentists or grocers, Psaki wrote. 

Senate Republicans have argued in recent days that a proposed consumer protection agency is too sweeping in scope and would, for example, put community banks under two regulators. The consumer agency is a major sticking point on the bill. 

"This isn't about burdening community banks with more regulation," Psaki wrote. "It's about holding non-banks like mortgage brokers to the same standards as the local banks they compete against."

Seven agencies oversee rules on consumer financial products and services but most are focused on the "health of banks and none sees consumer financial protection as its top priority," allowing parts of the consumer market to operate without much oversight. 

To read the full blog post, click here.