The Wall Street Reform and Consumer Protection Act (H.R. 4173), will end taxpayer-funded bailouts and ‘too big to fail’ financial institutions, protect consumers from predatory lending, safeguard our retirement and college savings from unnecessary risks, and inject transparency and new accountability into a financial system run amok.
The legislation will create a new Consumer Financial Protection Agency to protect families and small businesses by ensuring bank loans, mortgages, and credit cards are fair, affordable, and understandable. For the first time, the new agency streamlines into one place the role of protecting ordinary Americans’ financial security.
This bill also creates the Office of Financial Literacy, which was authored by Congressman Hinojosa. The office will help educate consumers on consumer financial products and services by providing one-on-one financial counseling; helping individuals understand basic banking and savings tools; helping individuals understand their credit history and credit score; assisting individuals in their efforts to plan for major purchases, reduce their debt, and improve their financial stability. Congressman Hinojosa also made sure the bill would call upon the Director of the Office of Financial Literacy to develop a marketing campaign to promote financial education and on-on-one counseling for all individuals during all stages of life throughout the United States.
“This bill also contains provisions to improve the financial literacy and financial education of consumers who send remittances to loved ones here, overseas and in other countries”, said Hinojosa. “Consumers should also have peace-of-mind of knowing that they are not going to be tricked by unscrupulous lenders”.
The Wall Street Reform and Consumer Protection Act of 2009 unwinds “too big to fail” financial firms before their risky and irresponsible behavior threatens to bring down the entire global economy. It also strengthens government oversight over large banks and financial firms – including new regulation of credit rating agencies and riskier hedge funds, derivatives, and other complex financial products and entities.
This bill includes tougher enforcement and oversight of existing protections. It gives the Securities and Exchange Commission new enforcement powers, including requiring hedge funds and private equity funds to register. It enhances oversight and transparency of the credit rating agencies whose seal of approval gave way too many of the excessively risky practices that led to a financial collapse. It addresses egregious executive compensation, allowing shareholders to have a ‘say on pay,’ requiring independent directors on compensation committees, and limiting the risky pay practices of bank executives that jeopardized banks’ soundness.
“Wall Street reform and additional consumer protections are the next critical step to create jobs and exit the current sever recession”, said Hinojosa. “As we rebuild our economy, we must put in place common-sense rules to ensure that neither financial institutions nor Wall Street can jeopardize our economic recovery and hurt hard-working families and small businesses.”
This bill creates the Office of Fair Lending and Equal Opportunity that will provide oversight and enforcement of Federal laws intended to ensure the fair, equitable, and nondiscriminatory access to credit for both individuals and communities under the Equal Credit and Opportunity Act (ECOA).