WASHINGTON, Dec.
11 – The new financial reform legislation passed by the House of
Representatives on Friday is an important step towards protecting consumers and taxpayers from reckless financial practices,
according to NMPublic Interest
Research Group, a national consumer organization.
The Wall Street
Reform and Consumer Protection Act, H.R. 4173, approved by a vote of 223-202,
establishes a new independent Consumer Financial Protection Agency (CFPA),
reins in the ability for banks and investment firms to get
“too-big-to-fail” and then needing massive taxpayer bailouts, opens,
for the first time, the Federal Reserve to public oversight, and creates accountability
for hedge funds and other previously unregulated players that were central causes
of the economic meltdown one year ago.
“The House
has taken critical steps to protect consumers and taxpayers from another
financial collapse brought on by reckless and predatory practices and a
regulatory system that failed,” said Ed
Mierzwinski, NMPIRG’s Federal Consumer Protection Director on Friday. “Defeat
of the banks’ efforts to get rid of the game-changing Consumer Financial Protection Agency was a key vote,”
he said.
Mierzwinski’s
colleague, Tax
and Budget Analyst Nicole Tichon, also applauded the House vote.
“No longer
will the Federal Reserve operate as an arrogant, secretive government unto
itself,” Tichon said. “By including legislation that would assure
more transparency at the Fed, lawmakers stood up for the taxpayers, not for
backdoor bailouts and big banks.”
“The
public is angry about the mess created by Wall Street and the bailouts they took,” added Gary
Kalman, federal lobbying office director. “This bill
takes major steps towards reining in the dangerous and deceptive practices that
got us into the crisis.”
Financial
industry groups opposed many aspects of H.R. 4173, and their lobbying and work
behind the scenes left some of their marks on the bill. NMPIRG and its
allies in the Americans for
Financial Reform coalition will have to work hard to assure the interests
of Main Street trump Wall Street in the final version of financial reform
legislation as it makes its way through the U.S. Senate.
For example,
Mierzwinski noted, the banks were able to weaken the CFPA to preserve the
preemption of some state legislative and attorney general authority over
national banks by reinstating federal law as a floor, not ceiling of protection. NMPIRG and allies will also work to strengthen the oversight and accountability
of speculative trading in derivatives.
