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July 1, 2009 - The Administration provided legislation to Congress on June 30 for the development of its proposed Consumer Financial Protection Agency (CFPA).
The agency would be dedicated to the interests of consumers, protecting them against unscrupulous practices as well as increasing consumer access to financial services. The proposed agency is a part of the Administration’s financial regulatory reform plan released June 17. The Administration’s plan explains that the CFPA would not preempt state consumer protection laws and would partner with the states to protect consumers.
The main premise for the new agency is to consolidate fragmented responsibility for consumer protection. “Consumer protection will have an independent seat at the table in our financial regulatory system. By consolidating accountability in one place, we will reduce gaps in federal supervision and enforcement, drive greater clarity in the information consumers receive around products they are sold, set higher standards for those who sell those products and promote consistent regulation across the system,” said Treasury Secretary Timothy Geithner on June 29.
The suggested legislation can be downloaded here.
National Credit Union Administration (NCUA) Chairman Michael Fryzel also announced his intention to create a NCUA Consumer Protection Office in the 2010 agency budget. The new office would consolidate existing consumer protection functions already administered by NCUA and would create a liaison relationship with relevant external parties, such as the Consumer Financial Protection Agency, if that proposed entity becomes a reality, said Chairman Fyzel on June 30. You can read more about Chairman Fryzel’s announcement here. NASCUS will continue its work to defend against preemption in its advocacy efforts on behalf of state regulators and state-chartered credit unions on the regulatory and legislative levels.
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