May 6, 2011
WASHINGTON, D.C. — Consumers Union, the nonprofit publisher of Consumer Reports, today called on Congress to reject efforts to weaken the Consumer Financial Protection Bureau (CFPB) and undermine its ability to protect consumers.
Pamela Banks, senior policy counsel for Consumers Union, said, “We need a cop on the beat to protect consumers from credit card rip-offs and shady mortgages. If Congress shackles this bureau, lawmakers will be putting consumers at risk of more abuse by big banks and financial scam artists. We learned the hard way that when financial abuses go unchecked, the economy suffers mightily, and consumers get hurt.”
Opponents of the CFPB in the Senate are pledging to vote against any nominee to head the bureau unless changes are made that would seriously compromise its ability to stop abuses by big banks and other financial firms. That effort comes in the wake of a House financial subcommittee’s approval of legislation that would make it much harder for the bureau to do its job.
This effort against the CFPB includes a push to get rid of the bureau’s director position and replace it with a five-member commission. That would hamstring the CFPB’s ability to respond to fast-moving problems in the financial marketplace. Consumers Union said a single director is crucial to carrying out the CFPB’s mission, while a five-member panel would burden the bureau with a unnecessary and complicated bureaucracy. Efforts to subject the CFPB to the annual appropriations process would politicize its funding, unlike other financial regulators.
Banks said, “The CFPB is critical to helping consumers in the wake of the recession and making sure we don’t spiral into another economic meltdown. The bureau will be there to help consumers get the information they need to understand the true costs of financial products, before they sign their name on the dotted line. The bureau will put a stop to unfair and deceptive practices, and keep the rules for financial services updated as the market evolves. We need a watchdog for consumers, not a lapdog for the banks, and that’s why Congress needs to stand up and reject this effort to cripple the CFPB.”