President Obama Wants to Create a New Consumer Financial Protection Agency
Friday, October 09, 2009SUZANNE PRATT: Now that health care reform is well on its way, President Obama turned his focus to new regulation for the financial system. He renewed his push for a consumer financial protection agency, saying we need to keep closer tabs on banks and write new rules for mortgages and credit cards. His statements came after meeting with some Americans ripped off by unscrupulous lenders. Stephanie Dhue reports.
PATRICIA NELSON, RETIREE: I was caught in a death trap of predatory lending.
STEPHANIE DHUE, NIGHTLY BUSINESS REPORT CORRESPONDENT: Patricia Nelson told President Obama how she paid $2,700 in interest over two years without paying any principle of a $550 payday loan. The president also heard of bad mortgages and whopping overdraft charges. He wants a new consumer watchdog agency to crack down on abusive lending.
NELSON: It will ensure that banks and other firms can't hide behind these ridiculously confusing contracts, pages and pages of fine print that nobody can figure out.
DHUE: But some business groups, including the U.S. Chamber of Commerce, oppose a new agency. The chamber's David Hirshmann says it won't fix the problem.
DAVID HIRSCHMANN, SENIOR VP, U.S. CHAMBER OF COMMERCE: Building another layer upon a broken regulatory structure doesn't fix regulation. What we need is a new regulatory structure.
DHUE: To get the word out, the chamber is running radio and print ads. The president called out the chamber's campaign.
OBAMA: You might have seen some of these ads, the ones that claim that local butchers and other small businesses somehow will be harmed by this agency. This is, of course, completely false.
DHUE: The president says only businesses that offer financial services will be affected by the new agency. But the chamber says that depends on how the law is written. The battle will heat up next week when the House Financial Services Committee will vote on a series of bills to overhaul financial regulation. Stephanie Dhue, NIGHTLY BUSINESS REPORT, Washington.
