Release Date: Mar 01, 2011Contact: 888-249-NEWS
U.S. Chamber Leads Industry-Wide Effort to Improve Consumer Protection Agency
In Letter to Geithner and Congress, Business Group Offers Recommendations to Establish Effective Bureau that Protects Consumers Without Inhibiting Job Creation
WASHINGTON, D.C.— Ahead of Wednesday’s House Financial Services Committee hearing about the Dodd-Frank Act’s impact on small businesses, the U.S. Chamber of Commerce led more than a dozen business groups in presenting Congress and Treasury Secretary Geithner with six recommendations to guide the development of an effective and transparent Consumer Financial Protection Bureau (CFPB). The recommendations strike a balance to allow the CFPB to fulfill its consumer protection mandate while ensuring that small businesses continue to have access to credit.
“The Dodd Frank Act gave the CFPB tremendous power, with virtually no oversight, to go after bad actors. If that power isn’t used carefully, there could be serious collateral damage to America’s job creators,” said Jess Sharp, executive director for the Chamber’s Center for Capital Markets Competitiveness, who will testify before the Financial Services Committee. “We’ll continue to work with the Administration and Congress to create an agency that protects consumers and small businesses while not stifling job creation.”
In the letter, the industry-groups offered their support for sound consumer protection regulation that weeds out fraudulent and predatory actors and ensures consumers receive clear and concise disclosures about financial products, but pointed out a number of potential threats to small and Main Street businesses. The letter discusses six recommendations to help address these concerns and to improve the bureau’s overall effectiveness, including:
Develop Effective and Efficient Structure to Facilitate Protection of Consumers and Promotion of Economic Growth
- After many agencies failed to act appropriately ahead of the financial crisis, this new bureau must communicate in a way that inspires confidence that it will protect consumers in a uniform mannerEmpower
Consumers by Rationalizing Disclosure Requirements
- The bureau should continue to improve and simplify disclosure across products while not stifling consumer choice of financial products
Prevent Duplicative and Inconsistent Regulation of Main Street Businesses
- Compliance is critical, so the bureau must take steps to clarify its requirements and ensure Federal regulators are speaking with one voice
Preserve Small Business Access to Credit
- Regulations should not eliminate, or make impractical, the credit products that small businesses rely on for capital
Ensure Coordination with Federal and State Prudential Regulators
- The bureau should involve prudential regulators early and often to ensure proper consideration of safety and soundness issues
Defer Rulemaking Until After Confirmation of a Director
- Issuing rules prior to the Senate confirming a director to the bureau will prevent Congress from exercising the one avenue for oversight that it expressly retained
“The decisions made over the next several months, both before and after the handoff to the new CFPB, will shape the consumer financial regulatory environment for years to come,” Sharp said. “We look forward to working with the Administration and Congress to develop a new bureau to help achieve these objectives.”
Since its inception in 2007, the Center for Capital Markets Competitiveness has led a bipartisan effort to modernize and strengthen the outmoded regulatory systems that have governed our capital markets. The CCMC is committed to working aggressively with the administration, Congress, and global leaders to implement reforms to strengthen the economy, restore investor confidence, and ensure well-functioning capital markets.
The complete letter is available at: http://www.centerforcapitalmarkets.com/wp-content/uploads/2010/04/110228_MultiIndustry_ConsumerFinancialProtectionBureau_SecretaryGeithner.pdf
The U.S. Chamber of Commerce is the world’s largest business federation representing the interests of more than 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations.
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