New CFPB Leader Pledges 'Tough' Enforcement Regime

September 16, 2011
American Banker 
consumer financial protection bureau news

In his first speech since taking the reins at the Consumer Financial Protection Bureau, Raj Date cautioned that the agency will take a tough stance when it identifies products that are harmful for the public. On Sept. 15, he told a group of bankers and consumer advocates in Philadelphia, "Make no mistake: When we find unjustified practices that cause substantial consumer harm, we will take the necessary action to put an end to them." However, he emphasized that enforcement is only one tool the CFPB will have its disposal along with supervision, rulemaking, and research. While Date touched on the bureau's overall agenda, he intimated that specific products -- including bank overdraft programs and short-term cash advances -- will be given special attention. The CFPB is hamstrung from reforming the mortgage market, including through the introduction of loan servicing standards, until a permanent director has been appointed; but it does plan to flag problems in the student loan market and roll out additional rules for credit cards. Date stressed that all of the regulator's work will be grounded in product transparency, common-sense regulations, consistent oversight, and smart enforcement. By giving consumers the confidence to borrower for a home purchase or for higher education purposes while simultaneously giving banks the confidence they need to innovate and compete, Date said the new agency will stimulate the economy as a whole.
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