This past Monday I had the pleasure of catching up with my old friend Elizabeth Warren. She was the keynote speaker at the National Association of Attorneys General meeting in Charlotte, NC.
Professor Warren made it very clear that the Consumer Financial Protection Bureau (CFPB) will focus on compliance, supervision and enforcement of financial products. This includes all areas of the debt relief world as well as lenders and payday loans.
More than half of the CFPB resources will be dedicated to compliance with the law. In cooperation with the frontline attorneys general the CFPB will have a closer ear to the frontline of consumer complaints. This cooperation will create a faster track for government intervention.
Since the FTC and CFPB plan to share enforcement action from “different directions” hopefully companies taking advantage of consumers will have fewer places to run.
Both FTC Commissioner Brill, who also spoke at the conference, and Professor Warren said there would be no hard boundaries between the agencies but saw overlap as a beneficial outcome.
Having a “profound effect on consumer financial markets” is the intention of the CFPB and the CFPB looks forward to be the new cop on the beat.
It seems that the goal is to allow honest businesses to thrive while dishonest businesses that harm and take advantage of consumers will become aggressive targets of action. Debt relief companies should notice that the way forward is through compliance with the rules and transparency. It was clear from her presentation that the old belief that “we’re too small for regulators to hassle with” is now gone.
Professor Warren made it very clear that law enforcement will be the hallmark of the CFPB, leaving the bad guys no place to run.
I also had lunch with the Deputy Director of Enforcement for the CFPB, Kent Markus. I found him to be a regulator with a great amount of consumer level experience and an enthusiasm to learn more about the debt relief issues that harm consumers. Markus will be working closely with his longtime friend, the Director of Enforcement, former Ohio Attorney General Richard Cordray.
By the way, for those of us that have had the pleasure of working with Alison Brown at the FTC she is leaving the agency this week and headed for a new role with the CFPB.
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