Healthcare reform has been getting most of the attention on Capitol Hill and in the national press lately, but for home buyers, sellers, and mortgage applicants, the legislative ballgame will really get underway later in September, when Congress begins work on the proposed Consumer Financial Protection Agency. So begins an L.A. Times article the first part of this month which overviews legislation that would create that agency, now pending in the House and pushed by Financial Services Committee Chairman Barney Frank (D-Mass.), who is its principal author. (See Here )
"The core idea behind the proposal, supporters say, is to pull together consumer oversight powers that are now scattered among various agencies, and to put consumer interests where they should be -- much higher on the priority list than they were during the years leading up to the housing and credit bubble and bust."
"Banking and mortgage trade group leaders generally agree that the existing regulatory system failed badly -- for consumers and the industry itself," the article says. "'We're in favor of better consumer protection,' says Anne Canfield, executive director of the Consumer Mortgage Coalition, which represents major mortgage originators and banks., but how to go about achieving those reforms is where Canfield's group and others part company with the administration and consumer supporters."
Principally, the act would "establish the Consumer Financial Protection Agency as an independent, executive agency to regulate the provision of consumer financial products or services (products or services) under: (1) this Act; (2) consumer finance laws including the Electronic Funds Transfer Act, the Equal Credit Opportunity Act, provisions of the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the Home Mortgage Disclosure Act, the Real Estate Settlement Procedures Act, the Truth in Lending Act, and the Truth in Savings Act; and (3) transferred authorities concerning consumer financial protection functions of the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, the Director of the Office of Thrift Supervision, the Federal Deposit Insurance Corporation (FDIC), the Federal Trade Commission (FTC), and the National Credit Union Administration (NCUA)."
Late last Monday, attorney generals from 24 states, including Ohio, sent a letter to the Senate Banking Committee and the House Financial Services Committee, voicing their strong support for the Consumer Financial Protection Agency proposed by the Obama Administration.
The letter in pertinence affirms, "As the chief law enforcement officers of our states, we strongly support legislation to create a Consumer Financial Protection Agency ("CFPA"). The current financial crisis, caused in part by irresponsible subprime lending and inadequate oversight, has demonstrated the need for comprehensive and effective consumer protection and enforcement at the federal level. We believe an independent federal agency combined with joint enforcement by state officials is the best option for meaningful consumer protection in this area."
The Wall Street Journal and New York Times have also had recent articles on the Consumer Financial Protection Agency.