U.S. Chamber Highlights Continued Concerns with Latest So-Called Consumer Protection Agency Proposal

Calls it Wrong Approach, Says Will Still Hurt Consumers

WASHINGTON, D.C.—David Hirschmann, president and CEO of the Chamber's Center for Capital Markets Competitiveness issued the following statement in response to the latest Consumer Financial Protection Agency (CFPA) proposal discussed today before the House Financial Services Committee:

"The Chamber continues to support strong consumer protections and comprehensive modernization of our financial regulatory system. While we appreciate the House Financial Services Committee's work to address concerns with its original proposal, the latest draft of the legislation fails to resolve the key problems with the proposed CFPA.

"The new draft, despite the Committee's efforts, continues to pose harmful unintended consequences for consumers, businesses and the economy. It will still create a giant new bureaucracy, place heavy burdens on small firms, and limit consumer choice.

"Congress should continue to consider alternative approaches that will ensure effective consumer protection without jeopardizing the choices of consumers and the availability of credit for businesses."

The Chamber pointed to four areas of the revised consumer protection legislation that remain unchanged. The bill:

1. Gives the agency sweeping and ill-defined powers that continue to target businesses outside the consumer financial services industry;
2. Provides the CFPA authority to mandate the financial products offered to consumers;
3. Fails to resolve conflicts between the CFPA and other financial regulators continuing the status quo in the current broken system; and
4. Does not bring consistency to consumer disclosure and protections by creating uniform national standards.

These areas were highlighted today in testimony by Andy Pincus, partner, Mayer Brown LLP, an outside counsel to the Chamber who provided legal analysis of the bill.

A copy of testimony by Andy Pincus can be found at: http://www.uschamber.com/issues/testimony/2009/090930cfpa.htm

The U.S. Chamber is the world's largest business federation representing more than 3 million businesses and organizations of every size, sector, and region.

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