Consumer-Protection Agency in Doubt

Wall Street Journal (NY) 
January 15, 2010
Paletta, Damian
P. A4;

U.S. Senate Banking Committee Chair Chris Dodd (D-Conn.) could eliminate the Consumer Financial Protection Agency (CFPA) proposal from financial regulatory reform in order to drum up bipartisan support for the overhaul bill. If the CFPA proposal is indeed scrapped, Republicans will have to agree to strengthen consumer protections within another federal agency. Without the necessary 60 votes to block a Republican filibuster, Democrats must garner bipartisan support for any financial regulatory overhaul legislation. Dodd, who has announced his retirement from the Senate, is still working with U.S. Sen. Richard Shelby (R-Ala.) on the bill, though sources would not reveal any details of the negotiations. However, analysts are concerned that abandoning the CFPA would weaken financial reform efforts and anger consumer groups and liberal lawmakers. "We need an independent regulator because the existing regulators have shown themselves to be incapable and unwilling of protecting consumers from abusive financial products," stated the Consumer Federation of America's Travis Plunkett. Possible alternatives to an independent CFPA include a new division in the U.S. Treasury or a beefed up consumer protection division within a federal bank regulator.

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