Consumer Financial Protection Safety and Soundness Improvement Act of 2011

Floor Speech

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Ms. RICHARDSON. Mr. Chair, I rise today in strong opposition to H.R. 1315, the ``Consumer Protection Safety and Soundness Improvement Act'' because it is an undisguised attempt to undermine the critical reforms we worked to put in place following the economic disaster which cost this country 8 million jobs and $17 trillion in Americans' net worth and retirement savings.

I cannot support legislation that would take us back to a time when the people charged with regulating the financial industry were so intertwined with its interests that they purposefully looked the other way while unscrupulous firms conjured up dangerous and self-defeating schemes that brought our nation to the brink of economic disaster.

My friends on the other side of the aisle, aided by the army of banking industry lobbyists, all seem to have forgotten everything that happened in the past three years, so let us review the record.

Years without accountability for Wall Street and the Big Banks under President Bush and Congressional Republicans led to what most economists consider to be the worst financial crisis since the Great Depression.

The official explanation was that the crisis was not a natural disaster, but the result of high risk, complex financial products; undisclosed conflicts of interest; and the failure of regulators, the credit rating agencies, and the market itself to rein in the excesses of Wall Street.

Major financial institutions began to fall like dominoes, and we had to step in and bail them out. I voted for the Dodd-Frank Wall Street Reform and Consumer Protection Act because it ended any possibility of another taxpayer bailout and put in place measures to ensure that such insanity should never again threaten the livelihoods of innocent Americans.

H.R. 1315 is designed to slow down the Consumer Financial Protection Bureau (CFPB), replacing its single leader with a 5 member commission, which is likely to lead to internal gridlock.

Simply put, this legislation is an attack on the landmark Dodd-Frank Wall Street Reform Act passed by the Democratic-controlled 111th Congress and an attempt to return to the bad old days of the Wild West of Wall Street.

Weaken, delay, and erode--these are the tactics being employed through this legislation by those who choose to side with some reckless Wall Street bankers over millions of American families.

Mr. Chair, the financial crisis of 2008-2009, which we have come to call the ``Great Recession,'' saw millions of Americans pay the price of abuses committed by big banks, credit card companies, and other financial institutions on Wall Street.

They paid with their homes, their savings, their pensions and their jobs.

The Consumer Financial Protection Bureau was established under the Wall Street Reform and Consumer Protection Act which President Obama signed into law last year. Since then, opponents, backed by an army of banking lobbyists, have tried to restrict and cripple parts of the law that will do the most good for American consumers, the CFPB being the prime target.

H.R. 1315 replaces the Director of the CFPB with a 5 person commission, which will make it easier for other banking regulators, who failed to protect consumers in the past, to overturn its rules and delay its core functions until its leadership is confirmed by the Senate.

Mr. Chair, despite the claims made by supporters of H.R. 1315, the CFPB is far from being some all-powerful government bureaucracy subject to the whims of a single person, as new rules and initiatives it generates can at any time be overturned by a two-thirds vote from the Financial Stability Oversight Council. This ensures that the Director of the CFPB is held to account to the overall safety and stability of U.S. financial institutions.

The CFPB is intended to oversee the $3 trillion consumer finance industry and prevent unfair and deceptive lending practices such as those that caused the economic crisis we find ourselves in today.

H.R. 1315 would delay the transfer date for the CFPB until there is a Director confirmed by the Senate--a distant prospect since Republican Senators have vowed to filibuster any person nominated by President Obama. Thus, this provision in the bill would leave the CFPB with no meaningful consumer protection authority when it officially opens its doors.

The same federal banking regulators who failed us the first time will remain in charge, leaving consumers unprotected from the abuses that brought our country to the brink of collapse and led to the loss of more than 8 million American jobs.

Mr. Chair, since its creation last year, the CFPB has made considerable progress which hints at its full potential as a valuable and necessary component of our regulatory framework.

The CFPB has established a new consumer complaint process and consolidated the authority of seven other agencies in policing abuses in consumer financial products such as mortgages and credit cards, pushing their providers to simplify their forms so consumers fully understand the costs and fees associated with their products.

The CFPB also provides special guidance to members of the armed forces and has taken steps to police unfair practices employed by certain payday lenders and debt collectors.

H.R. 1315 throws a wrench into these accomplishments with the ultimate goal of destroying the Consumer Financial Protection Bureau and turning back the Dodd-Frank Wall Street Reform Act.

Mr. Chair, I believe that strong consumer protections are essential to stabilizing the economy, promoting competition and transparency, and bringing confidence back to the financial marketplace.

For these reasons and for the protection of my constituents' livelihoods, I will vote against this legislation and I encourage my colleagues to do likewise.

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