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Ohio Attorney General Richard Cordray backs
federal Consumer Financial Protection Agency
(AP photo)
COLUMBUS, Ohio: Ohio Attorney General Richard Cordray urged Congress Wednesday to create the proposed Consumer Financial Protection Agency (CFPA), a initiative he said would focus more not less attention on protecting consumers who have been hurt bad by mortgage brokers and shady products like sub-prime mortgage loans.
Joining Cordray in the news tele-conference on financial reform was Ed Mierzwinski, Consumer Program Director for the Ohio Public Interest Research Group (OPIRG).
The urgency of now to protect consumers
OPIRG stated in information sent to reporters that as early as Thursday, October 15, the US House Financial Services Committee (HFSC) will vote on legislation proposed by President Obama to establish CFRPA. Banks and credit unions, it said, are "running a massive campaign against the reform, especially its key provisions to reinstate federal laws as a floor not a ceiling of protection and to allow state attorney generals to once again defend consumers against unfair practices by national banks." Eliminating that authority, OPIRG declared, was one of the critical mistakes that led to the worldwide financial meltdown.
Ohio Attorney General Richard Cordray has said previously that “the current regulatory structure has repeatedly failed to address unfair, unsound, and deceptive financial products.”
Ohio home foreclosures a problem of the past and future
With the news that 105 thousand home foreclosures took place in Ohio since January of 2008, combined with the expectation that another 280 thousand may occur between now and 2012, both Mierzwinski and Cordray said the time to act is now.
Cordray, who last year was elected to replace former Ohio AG Marc when his administration folded from office scandals and who will likely face the well-known persona of Republican Mike DeWine in next year's election for the office, said he and his AG colleagues have been following the proposed creation of the CFPA since first proposed by the administration of President Barack Obama.
"I understand it is a struggle in congress over regulation and who controls it," he told invited reporters. Cordray likes the one-stop attributes of the agency, saying the CFPA should be a federal floor and not a ceiling, which would enable states like Ohio to enact tougher standards that could be used to hold mortgage brokers accountable for their actions and products.
Cordray, who said more not less focus needs to be put on consumer protection, indicated he will "remind key players" in the coming days that CFPA is "the right direction" to take.
"My colleagues feel strongly on this topic," Cordray added.
Mierzwinski said the CFPA is a lynch-pin solution for consumers.
Ohio has three members -- Steve Driehaus of Cincinnati, Mary Jo Kilroy of Columbus and Charles Wilson of southeast Ohio -- sitting on this committee.
The good news for Ohio is that if the measure passes the US House, it will move to the Senate where Ohio's junior senator Sherrod Brown, a strong supporter of consumer protection issues, chairs the committee that will address CFPA if and when it moves to the Senate.
Mierzwinski is described in advance materials for this topic as one of the nation’s leading consumer bank experts, who has called the new agency a “game-changer” and “the biggest reform since deposit insurance 75 years ago.” Mierzwinski has testified numerous times before Congress on the Obama financial reform package.
Mierzwinski said the banking lobby will attach the proposal by amending it so it is essentially impotent.
The US Financial Services Committee oversees all components of the nation's housing and financial services sectors including banking, insurance, real estate, public and assisted housing, and securities.
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