President Obama made a bold move to stand with American consumers today when he announced that he would make a recess appointment of Richard Cordray to head the Consumer Finance Protection Bureau (CFPB). Unfortunately, the president had to defy Congress because of partisan bickering that has nothing to do with Mr. Cordray’s qualifications (which are numerous) and everything to do with GOP dislike for the CFPB.
The GOP’s position is bewildering, given that this consumer watchdog group promises to provide the kind of protection we all need from the sort of predatory lending practices that threw the U.S. economy into a tailspin just a few years ago. It should also be noted that these recess appointments are nothing new. President George W. Bush made 171 while he was in office and Bill Clinton made 139. To date, Mr. Obama has made just 29 of these recess appointments.
For Latinos specifically, Cordray’s appointment is especially welcome. In a statement, NCLR President and CEO Janet Murguía said, “Cordray’s announcement is a new day for America’s consumers. Having such a strong leader at the helm of the CFPB will not only protect our community from predatory lending practices, it will also help provide Latino consumers with the necessary information and services needed to make the best financial decisions for themselves and their families.”
As Cordray begins his work, it’s helpful to know just what the CFPB is and how it will benefit Latinos and all Americans.
The CFPB a new bureau created with the sole task of protecting consumer rights. The lack of strong protections for consumers has allowed unscrupulous lenders to lure borrowers into unfair and abusive financial products. As a result, Latino and other communities of color have been disproportionately affected by the economic crisis. This legislation created a new agency devoted to protecting Americans from abusive financial products and services, including mortgages, payday loans, and credit cards.
In its full operation, the CFPB would help:
- Prevent abusive lending tactics and products that endanger our savings and assets
- Ensure that individuals are able to access the most favorable loan or credit card for which they qualify
- Provide timely and relevant information and advice to average consumers to help them make smarter financial decisions
- Preserve the ability of states and tribal governments to respond to and protect their consumers
- Prevent opponents from blocking CFPB functions