Another Federal Watchdog Agency? It’s a Good Thing

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We support reforms to the financial marketplace that protect consumers from unscrupulous banks and lenders.

By Consumers Union on Tuesday, March 10th, 2009

Running with Elizabeth Warren’s idea that she wrote about on AFFIL’s blog Senators Durbin and Schumer proposed a new consumer watchdog agency today.

The news had an immediate impact among mortgage industry bloggers. Randy Hooker’s post asks:
” is this potentially some much needed and long over-due oversight of mortgage loan products? ”

The answer is YES.

In a letter to the Senators, Consumers Union and more than fifty diverse organizations stated their strong support for legislation to create a federal agency that would “ensure the safety, fairness and sustainability of credit and payment products”.

The Financial Products Safety Commissions’ sole job (yes, it is a catchy name) would be consumer protection. It would look out for and then ban unfair or deceptive practices and features in credit and payment products (that includes those “more fees debit cards” we told you about last week). We are all now suffering the consequences of deceptive lending. The FPSC (we are assuming that would be the witty acronym) would be similar to the recently strengthened Consumer Product Safety Commission.

For more on how financial regulation should be changed see what we said to President Obama.

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