Consumer Law

Bankers Were for Separating Safety and Soundness Regulation from Consumer Protection Before They Were Against It

By Jeff Sovern

Here's a quote from Elizabeth Warren's op-ed yesterday in Politico, referring to the 2006 filing from the American Bankers Association:

In 2006, the ABA claimed to act on principle as it railed against an interagency guidance designed to exercise some modest control over subprime mortgages. It criticized the proposal for ?combin[ing] safety and soundness guidance with consumer protection guidance, creating confusion that is best addressed by separating them.?

The ABA went on to argue that the ?marriage of inconvenience between supervision and consumer protection appears to blur long-established jurisdictional lines.? And then: ?ABA recommends that the safety and soundness provisions relating to underwriting and portfolio management be separated from the consumer protection provisions.?

Read that again: The ABA in 2006 said that policymakers should separate safety-and-soundness and consumer protection ? exactly the opposite of its position today.

Full post as published by CL&P Blog on March 31, 2010 (boomark / email).