The Consumer Financial Protection Bureau (CFPB) may be doomed even before it officially opens for business. Richard Shelby, the ranking Republican on the Banking Committee, and other Republican Senators say they will block confirmation of former Ohio Attorney General Richard Cordray as head of the new bureau. Meanwhile, the GOP is also trying to weaken the watchdog group's authority, fearing the CFPB will be detrimental to banks and credit card companies. (See: "Indefensible": Credit.com's Levin Blasts GOP Opposition to Warren, Cordray & CFPB)
As the name implies — the bureau is designed to protect consumers from predatory financial practices, especially in credit card and mortgage business, and increase transparency between lenders and borrowers.
Adam Levin co-founder and chairman of Credit.com says that's no reason for Washington to oppose the CFPB's mission. "Standing up for the American consumer doesn't mean anti-business," he tells Aaron Task in the accompanying clip.
Levin hopes the group will help prevent another debt bubble and era of irrational consumption. "We've got to raise the level of financial literacy in this country," he says. "We've got to put people on a more level playing field."
But what will make this federal regulatory group any more effective than all the others that were around and allowed the 2008 financial crisis to happen under their watch?
"Up to now there has never been one fully focused" federal consumer protection agency, says Levin.
What do you think? Is the CFPB necessary?
- the bureau
- Richard Shelby
- federal consumer protection agency
- Ohio Attorney General Richard Cordray
- 2008 financial crisis
- credit card companies