Assistant Senate Majority Leader Dick Durbin, D-Ill., has introduced legislation to create a single government agency in charge of policing financial products to ensure they are responsible, accountable and transparent.
Sen. Chuck Schumer, D-N.Y.; Sen. Ted Kennedy, D-Mass.; Rep. Bill Delahunt, D-Mass.; and Rep. Brad Miller, D-N.C., have signed on as cosponsors.
Durbin says his proposal for the Financial Product Safety Commission would improve the fractured oversight of the nation's financial markets, in which at least 10 federal regulators have responsibility for consumer financial products but none have oversight as its primary objective.
"In the past 30 years, the legal rules for mortgages, credit cards, and every other kind of consumer loan have moved consistently in one direction: against the family," says Elizabeth Warren, a Harvard Law professor and chairwoman of the Congressional Oversight Board for the Troubled Asset Relief Program. "The Financial Product Safety Commission promises to reverse that direction, putting in place a structure to make the rules a little fairer and to give families a fighting chance against any lenders that make their profits by tricks and traps."
The Financial Product Safety Commission, originally conceived by Warren, would add consumer protection to the factors lenders must consider in creating and offering financial products.
‘Changes in the credit markets have made debt far riskier for consumers today than a generation ago," adds Schumer. "Ordinary credit transactions have become extremely complex undertakings, and consumers are at the mercy of those who write the contracts. Consumers deserve to have someone on their side – a regulator that will watch out for the average American to ensure products work, without any hidden dangers or unreasonable tricks."
The Financial Product Safety Commission would prevent predatory or deceptive financial practices and educate consumers on the responsible use of financial products and services; coordinate enforcement with the other federal and state regulators and with the private sector to establish a floor beneath which consumer financial product safety could not fall; and report regularly to the public regarding the state of consumer financial product safety and recommend the steps that should be taken to improve the value of financial products for consumers.
The bill is supported by over 55 national and state organizations, including Consumer Federation of America, Center for Responsible Lending, Leadership Conference on Civil Rights, NAACP, La Raza, AFL-CIO, SEIU, National Consumer Law Center, Consumers Union, Public Citizen and US PIRG.
SOURCE: The Office of Sen. Richard Durbin