June 16, 2009
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News: Obama's Agency to Oversea Financial Industry
President Barak Obama is determined to guarantee that consumers are fully protected by many of the unfair and deceptive practices of credit card companies and the financial industry that have plagued the nation over the past decade. In his quest to reassure Americans, the President has given strong support in the development of a new consumer protection agency set up to monitor and regulate financial products such as credit cards, mortgages, and bank accounts. Details of the new consumer protection agency are expected to be released later this week. It is speculated that the agency will be granted increased power to oversee credit card companies, banks, and financial companies; increased power to the Federal Reserve in tightening up restrictions; and give additional power to the federal government in taking over failing companies.
The President has expressed his concerns over many of the financial industry's past marketing practices in issuing credit cards like giving 3, 4, or 5 cards to college students with little or no income or granting mortgages to individuals significantly above their earnings. The new agency would regulate these practices and would ensure that consumers have a full understanding of the terms and conditions of credit card, loan, and mortgage contracts. It would not push to cap out interest rates as many have asked for. Final details of the proposed consumer protection agency would still need to be fine tuned by Congress; however, the President is firm in his stand that the agency will centralize the responsibility for protecting consumers in their pursuit of financial products.
The news on the proposed consumer protection agency released earlier this week created a stir in the financial industry. Opponents say the agency will only create additional problems and conflicts with the industry. Additionally, they say added regulations instituted by the new agency would only serve to raise the cost of most financial products including mortgages and credit cards. Proponents say the new agency is essential in assuring consumers are fully protected against deceptive practices and that they be provided one centralized place to seek out assistance.