States Urge Federal Government To Protect Consumers
By Jay Fleischman, New York Bankruptcy Lawyer on May 31, 2007 in Michigan
Michigan officials have called on federal counterparts to increase efforts to protect consumers from predatory lending practices and fraud.
In April, the U.S. Supreme Court in a 5-3 ruling held that Michigan could not regulate lending by a mortgage subsidiary of a national bank, blocking the state’s efforts to enforce strict consumer protection laws on these subsidiaries.
Worried that the ruling weakened state enforcement powers, some U.S. lawmakers saw the ruling as a reason to increase enforcement powers at the federal agencies, including the OCC.
In May, House Financial Services Committee Chairman Barney Frank and House Energy and Commerce Committee Chairman John Dingell sent a letter to federal agencies, including the Federal Trade Commission, to urge them to strengthen rules to protect consumers against unfair and deceptive practices involving a wide range of financial services.
Neil Milner, Conference of State Bank Supervisors president, on Wednesday praised Comptroller of the Currency John Dugan for being more “pro-consumer” and for beefing up the agency’s consumer complaint center in Houston.
But he said states will need to push U.S. lawmakers to see if “a federal system is going to be able to … replicate (what states do) with a few people and have that same kind of responsiveness to the individual customers” as what thousands of people at the state level do for consumers.
Source: Reuters.
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