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Consumer Group Testimony on Enhancing Consumer Financial Products Regulation

Testimony of Travis Plunkett, Consumer Federation of America and Edmund Mierzwinski, U.S. PIRG

On Behalf of:

Americans for Fairness in Lending
Center for Digital Democracy
Consumer Action
Consumer Federation of America
Consumers Union
National Association of Consumer Advocates
National Consumer Law Center (on behalf of its low-income clients)
National Fair Housing Alliance
National People’s Action
Public Citizen

Before the Committee on Financial Services
U.S. House of Representatives
The Honorable Barney Frank, Chairman

Hearing on Regulatory Restructuring: Enhancing Consumer Financial Products Regulation

24 June 2009

“In the testimony we present today, we outline the case for establishment of a robust, independent federal Consumer Financial Protection Agency to protect consumers from unfair credit, payment and debt management products, no matter what company or bank sells them and no matter what agency may serve as the prudential regulator for that company or bank. We describe the many failures of the current federal financial regulators. We discuss the need for a return to a system where federal financial protection law serves as a floor not as a ceiling, and consumers are again protected by the three-legged stool of federal protection, state enforcement and private enforcement. We rebut anticipated opposition to the proposal, which we expect will come from the companies and regulators that are part of the system that has failed to protect us. We offer detailed suggestions to shape the development of the agency in the legislative process. We believe that, properly implemented, a Consumer Financial Protection Agency will encourage innovation by financial actors, increase competition in the marketplace and lead to better choices for consumers.”