On June 19, 2010, the Tips section of the Top Drawer Ink newsletter posted information about the future creation of a national Consumer Financial Protection Agency. The new agency set up shop in Washington, DC in February 2011, and began operating on July 21.
Named the Consumer Financial Protection Bureau—CFPB if you prefer acronyms—this independent agency within the Federal Reserve System is housed at Treasury and was created by the Dodd-Frank Wall Street Reform and Consumer Protection Act of July 2010.
Part of the reason for the Dodd-Frank legislation was to provide American consumers with helpful financial information. For instance, one highlight of the Act centers on making mortgage loans easier to understand—and CFPB is tasked with ensuring you receive and are fully aware of the facts before you sign your name on the dotted line.
Another CFPB responsibility is seeing that credit card issuers adhere to the rules of the Credit CARD Act. As you may recall, the CARD Act, which was approved in 2009, banned raising rates on existing credit card balances.
Also on the agenda is curbing large overdraft fees. This regulation gives holders of ATM and debit cards the choice of joining or not joining overdraft protection programs.
What else is the CFPB doing? To assist military service personnel and senior citizens avoid unlawful financial schemes and scams, the bureau is establishing the Office of Service Member Affairs and the Office of Financial Protection for Older Americans.
Here at Top Drawer Ink, we’re all for education. We’ll remain neutral on the question of whether more rules, regulations, and oversight will protect Americans from another financial melt-down.