Consumer watchdog agency proposed in House

Two congressmen think that a new consumer watchdog agency is needed in the wake of the financial crisis. The Financial Product Safety Commission Act, introduced yesterday by Reps. William Delahunt, D.-Mass., and Brad Miller, D.-N.C., would establish an agency to protect consumers from “abusive financial products used in mortgages, credit cards and retirement accounts.” “Today, there are 10 federal regulators that have some degree of responsibility for protecting consumers from predatory or deceptive financial products, but none have oversight as their sole objective,” Mr. Delahunt said in a statement. “As a result, debt instruments have become far riskier than in the past,” he said. “The economic crisis has shown as that the time is ripe for a watchdog agency to protect consumers from dangerous financial instruments.” The Financial Product Safety Commission would serve as a consumer watchdog and establish a regulatory floor for consumer financial and credit products and recommend steps to improve financial products for consumers. In addition, the agency would work to prevent predatory and deceptive financial practices and educate consumers, according to the statement. “The bill is not trying to usurp all of the other regulatory functions but help to coordinate them and focus them,” said Mark Forest, chief of staff to Mr. Delahunt. “The intent is to bring together all of the other regulatory agencies that have some role in consumer products, and have them working together.” The five-member commission would also be charged with investigating and resolving consumer complaints. The bill was sent to the House Financial Services Committee for consideration. A similar bill was introduced in the Senate.