Reining in Wall Street
STANDING UP AGAINST THE BIG BANKS AND WALL STREET—For more than 20 years, Consumer Program Director Ed Mierzwinski has helped us stand up against big banks and credit card companies.
A PRO-CONSUMER FISCAL FUTURE
Consumers shouldn't have to worry that their financial institutions are ripping them off, or using tricks and schemes to squeeze money out of them.
Yet for years, federal bank regulators ignored numerous warnings of increasingly predatory mortgage practices, credit card tricks, and unfair overdraft policies used by the big Wall Street banks. They also ignored warnings of risky securities being packaged and sold to investors. In the wake of the resulting financial crisis, U.S. PIRG fought for and successfully urged passage of a strong 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act.
Since winning federal Wall Street reform, we've worked to defend those reforms from the industry's attempts to defang, defund or delay them. In particular, since it began work in July 2011, we've had to defend the Consumer Financial Protection Bureau (CFPB), the first federal financial agency with just one job: protecting consumers. However, it took another two-year fight against the opponents of the CFPB to convince the Senate to confirm Bureau's director, Richard Cordray, to a full five-year term. The Senate finally confirmed Cordray in July 2012, eliminating any uncertainty over the CFPB's authority over credit bureaus, payday lenders and other non-bank firms.
The CFPB - in many ways the centerpiece of the broader 2010 Wall Street reforms - has already succeeded in protecting consumers, from students and soldiers to seniors and homeowners. Among the CFPB's successes have been its new regulation of the mortgage markets, its creation of a publicly-available consumer complaint database, and its investigations of the big credit bureaus. The CFPB has also made banks and credit card companies return nearly half a billion dollars to consumers who were treated unfairly.
Yet consumers, taxpayers and investors still face big risks in the financial marketplace. Big banks are allowed to make risky bets with our money, many financial institutions are still finding ways to unfairly squeeze money out of their customers, and financial industry practices still pose risks to the financial system. So in addition to defending the CFPB, we are working to protect investors, taxpayers and the financial system itself:
- We're supporting a requirement called the Volcker Rule which would prevent big banks from using their “own” money, which includes depositor funds, to place risky bets.
- We're urging the Commodity Futures Trading Commission not to allow the big banks to hide their reckless financial bets offshore the way that AIG and JP Morgan's London Whale did.
- We're backing Securities and Exchange Commission rules to require that all public companies, including banks, publish the ratio of compensation between their CEO and their middle-level employees.
In short, we're building a financial regulatory system that guarantees that consumers and taxpayers are protected from predatory practices. And we're fighting to give consumers a seat at the table when it comes to oversight of the nation's financial system.
Tools & Resources
Supporting "Consumer First" Fiduciary Standard
Send your senators a message right now, urging them to stand with consumers and support Richard Cordray and a strong Consumer Financial Protection Bureau.
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