Big Banks: 3 Consumers: 0

May 13, 2011|By Eileen Ambrose

The House Financial Services Committee today approved three bills to water down the new Consumer Financial Protection Bureau before it’s fully launched.

Supporters of the legislation say it will add accountability and transparency.

What’s transparent is that the legislation, backed by the banking industry, mostly serves to weaken the new Bureau.

One bill, which passed 33-24, would eliminate the position of the director and replace the head of the Bureau with a five-member commission made up of people from both political parties. Yes, we see how well the two sides work together to help consumers now. A commission would only slow down any real reforms and provide another venue for political posturing.

The second bill, with a 35-22 vote, would make it easier for other regulators to override the Bureau’s regulations. We need to make it harder for others to topple consumer laws, not easier.

And the third bill, with a 32-26 thumbs up, would prevent the Bureau from assuming its new regulatory powers on July 21 until a director is appointed. Harvard University law professor Elizabeth Warren is a favorite among consumer advocates for the post, although the banking industry largely opposes her. Consumer groups worry that Republicans in the Senate will block any appointment to prevent the Bureau from doing its job.

Read more here.

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