U.S. Consumer Financial Protection Bureau

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U.S. Consumer Financial Protection Bureau
Key People Richard Cordray, Director (Nominee), Elizabeth Warren, Special Advisor to the Secretary of the Treasury on the CFPB
Website www.consumerfinance.gov

The Consumer Financial Protection Bureau (CFPB) is a consumer agency that President Barack Obama proposed in June of 2009 as part of his financial overhaul plan.[1]

Former Ohio Attorney General Richard Cordray was nominated as Director of the CFPB on July 17, 2011. Elizabeth Warren serves as Special Advisor to the Secretary of the Treasury on the CFPB.

The centerpiece of Obama’s plan was to attempt to safeguard consumers against mortgage, credit card and other abuses that contributed to the credit crisis.[2]

In February of 2010, the Obama Administration backed away from creating a stand-alone Consumer Financial Protection Agency in its overhaul of Wall Street regulations, bowing to mounting pressure from lawmakers and industry. A White House official in a statement signaled a willingness to accept less than a separate agency. The statement outlined the powers legislation must provide for a consumer authority and dropped references to a separate agency to police banks for lending abuses.

On March 1, 2010, however, the head of the Federal Deposit Insurance Corp., Sheila Bair, pitched again for a new agency for consumer financial protection, saying that she believed the creation of such an agency would "help community banks, not hurt them."[3]

CFPB and the Dodd-Frank Act

One of the goals of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act), which was signed into law on July 21, 2010, is to promote financial stability by adding comsumer protections and curtail abusive practices in areas such as consumer lending, mortgages, and credit card issuance.[4] Title X of the Act creates the CFPB within the Federal Reserve, and authorizes the bureau to write and enforce consumer protection regulations. Its "triple mandate" is educating consumers, supervising financial institutions, and studying the relationship between the two.[5]

Resources

References

  1. Obama Pulls Back From Stand-Alone Consumer Financial Agency. Bloomberg.
  2. Barack Obama To Create Consumer Financial Protection Agency. Politico.
  3. Bair Pitching For Consumer Agency. Boston.com.
  4. Obama Signs Sweeping Wall Street Overhaul Into Law. Reuters.
  5. Learn about the Bureau. Consumer Financial Protection Bureau.