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JOHNSON OPENING STATEMENT ON CONSUMER PROTECTION HEARING

July 19, 2011

WASHINGTON – Today, Senate Banking Committee Chairman Tim Johnson (D-SD) held a hearing entitled “Enhanced Consumer Financial Protection After the Financial Crisis.”  The Committee heard testimony about how the Wall Street Reform Act will improve the financial lives of consumers, by promoting a fair and transparent marketplace and protecting consumers from unfair, deceptive and abusive financial products and services.
 
Below is Chairman Johnson’s statement as prepared for delivery:
 
“Today, the Committee will examine “Enhanced Consumer Financial Protection After the Financial Crisis.”
“As we approach the one-year anniversary of the Wall Street Reform and Consumer Protection Act, we should all be reminded of a basic lesson we learned from the Great Recession – failing to protect consumers has consequences not only for individuals and families, but also for the health of America’s economy.
 
“The failure by regulators to hold Wall Street banks and unscrupulous mortgage lenders accountable for complying with consumer protection laws was detrimental to American families and brought the global financial system to near collapse. 
 
“The cost of that failed oversight and accountability has been the loss of millions of American jobs, millions of homes, and trillions of dollars in retirement, college and other savings.
“In numerous hearings in recent years the Committee documented these failures by big banks and predatory subprime lenders to comply with consumer protection laws and the failure of banking regulators to hold them accountable.

“Passed in the wake of that thorough review with a bipartisan vote, the Wall Street Reform and Consumer Protection Act created a robust, independent consumer financial protection regulator.
“Congress established the Consumer Financial Protection Bureau to be the first financial regulator solely focused on consumer protection, but with more checks on its authority than the regulatory agencies that fell asleep at the switch.
 
“In fact, an independent bipartisan poll released this morning shows that three-quarters of Americans are in favor of having a single agency with the single mission of protecting consumers from financial companies.
 
“And, it is important to remember that most of the checks and balances imposed on this new regulator come from bipartisan ideas that were incorporated into the reform law during the months it was considered, and that the CFPB is modeled on the structure of existing financial services regulators.

“Putting partisanship aside, all of us here have a deep concern for American consumers.  And we all believe that the small community institutions that had no hand in the abusive practices that led to our financial crisis should not pay a price for being honest brokers. 
 
“The CFPB will help – by promoting an equitable and transparent marketplace and leveling the playing field between those responsible actors and the unregulated companies that preyed unchecked on consumers. 
 
“That is why undermining this cornerstone of the Wall Street Reform law would be irresponsible.
“It would also ignore our responsibility to America’s consumers and risk taking us back to the same unstable financial system that ushered in the Great Recession.
“Thank you and I look forward to working with all of you on these important issues.”
 
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