Senate GOP circulates consumer protection substitute legislation

Senate Republicans are circulating substitute legislation to Democratic efforts to bolster consumer protection in the Wall Street overhaul bill.

According to a one-page summary of the Republican legislation obtained by The Hill, Senate Republicans are looking at creating a consumer protection office at the Federal Deposit Insurance Corporation (FDIC).

The division would be led by a presidentially appointed and Senate confirmed director. All rules, regulations and orders would need to be approved by the board of the FDIC, according to the summary. The division would have primary supervision and enforcement power over large non-bank mortgage originators and other financial services companies, "who have violated consumer protection statutes."

Primary supervision for banks, thrifts and credit unions would remain with prudential regulators. The substitute would retain current policies on federal preemption of state rules and regulations, according to the summary.