Need to Know’s guest Richard Cordray is the first director of the Consumer Finance Protection Bureau.
What can the Consumer Finance Protection Bureau do for me?
Creating the Bureau was a long, hard fight even in the days following the economic meltdown when anger toward the financial services industry was high. Sen. Elizabeth Warren (D-MA) — then serving on the Congressional Oversight Panel of the Troubled Asset Relief Program (TARP) — first proposed the creation of the new consumer agency.
During the legislative battle to pass financial reform, Warren became such a lightening rod for industry criticism that when the Bureau was created by the Dodd–Frank Wall Street Reform and Consumer Protection Act, the President bypassed the hearing process to name her as chair and instead appointed her as a special consultant to Treasury with the mission of setting up the CFPB. Warren was clear about what she wanted the agency to do for American consumers:
“The best that this agency can do is to say to credit card companies, to mortgage companies, to banks, You can’t build a business model around tricking and trapping customers,” Warren said. “That’s just not going to work anymore.”
(Watch an interview with Elizabeth Warren from 2010)
What is the CFPB?
The White House laid out its goals in “Why we need a consumer watchdog.” The new organization was to consolidate oversight of consumer financial products including credit cards, mortgages and loans under one authority rather than seven.
“The Bureau is tasked with making sure people understand the fine print that explains the risks involved in using these services, and ensuring the banks, credit unions, and other financial companies that provide them play by the rules.”
But debate over the powers of the CFPB didn’t end with the passage of Dodd/Frank — as The Economist wondered recently will it be “Blessing or bureaucracy?” The conservative Heritage Foundation continues to protest that “Consumers Need Protection from Consumer Protection Bureau,” suggesting that the Chief of the new bureau would be “wielding unparalleled powers with virtually no accountability.” On the other side of the equation, consumer watchdog group Public Citizen is lamenting that the powers of the CFPB are being “delayed and diluted” but industry-sponsored push-back in Congress.
So what can the bureau do to help me?
The Consumer Finance Protection Bureau ” is charged with overseeing the Federal financial laws that specifically protect consumers—people who keep their money in banks and credit unions, pay for goods and services with their credit cards, and rely on loans to buy homes or pay for college, among other services.”
That means they provide practical tools for groups from veterans returning to civilian life to seniors considering mortgage modification. They host online tools to help you decide how to pay for college and even how to buy a car. And, the CFPB is now the one-stop shop for making complaints about every aspect of financial services, whether you feel that you’ve been the victim of biased lending or exorbitant credit card fees. And, their Facebook feed is full of timely connections to their resources. (To take a look backward at American consumer history watch Frontline’s excellent series “The Card Game” and “The Secret History of the Credit Card.)
More about Richard Cordray
Previously Cordray served as Ohio Attorney General, Ohio Treasurer and Franklin County Treasurer and a State Representative for the 33rd Ohio House District. the first Solicitor General in Ohio’s history, and was a sole practitioner and Of Counsel to Kirkland & Ellis. Mr. Cordray has argued seven cases before the United States Supreme Court, including by special appointment of both the Clinton and Bush Justice Departments. Explore the New York Times coverage of Richard Cordray and the CFPB.