Wednesday, May 12, 2010

Two Critical Consumer Financial Reform Issues Hang in the Balance

A message from the Consumer Federation of America:

Please Call Your Senators NOW!
Two Critical Consumer Financial Reform Issues Hang in the Balance
Your Senators Need to Hear from YOU!

The Senate debate on the financial reform bill, S. 3217, is in full swing and within the next day they will start consideration on two issues that have a great impact on consumers – preemption of state consumer protection laws (Carper Amendment #3949) and exemption of auto dealers from the Consumer Financial Protection Bureau (Brownback Amendment #3789).

The Carper Amendment (#3949) would:
· Prevent state Attorneys General from enforcing rules developed by the new Consumer Financial Protection Bureau against national banks. This amendment takes our on-the-ground state cops – the state Attorneys General – off the predatory lending beat.
· Leave enforcement for most banks entirely up to bank regulators, whose lax enforcement led to the recent economic crisis.
· Permit the Office of Comptroller of the Currency to let national banks ignore state laws that address new abuses not covered by federal protection – thus keeping states from acting as first responders that can stop local problems before they become national catastrophes.

The Brownback Amendment (#3789) would:
· Exempt auto dealers from oversight by the CFPB, even though dealers negotiate the price, term and structure of car loans – whether they originate the loan or sell the loan.
· Allow the status quo to continue, in which rulemaking and enforcement of consumer protections for auto dealers is fragmented and ineffective, thereby allowing unscrupulous dealers to continue targeting our Service members and minorities with predatory auto loans.
· Create an uneven playing field where auto loans issued by community banks and credit unions are subject to CFPB rules, but loans originated by auto dealers are not.
· Undercut reputable auto dealers and other lenders who have nothing to fear from the CFPB. The Bureau will work to support responsible lending and weed out those who engage in deceptive practices, like bait-and-switch financing or those who take kickbacks to steer consumers into higher priced loans, practices currently used by some auto dealers.

Call or email your Senators NOW and tell them to OPPOSE:
1. The Brownback Amendment to carve out auto dealers from the CFPB
2. The Carper Amendment to weaken enforcement of bank consumer protection rules!
Call: Toll-free at: 866-544-7573

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