Letter to a Congressperson Regarding the Formation of a Consumer Financial Protection Agency

[thom danfield]

Congressman Kevin McCarthy
1523 Longworth Building
Washington, DC 20515


July 10, 2009

Congressman McCarthy,

I want to ask you to co-sponsor and/or support a strong Consumer Financial Protection Agency. For too long banks and credit card companies have been able to use deceptive methods to lure unsuspecting consumers into credit situations that they, the consumer, had no business engaging in.

This new agency would be able to implement common-sense reforms that are long overdue. It would require banks to spell out the key terms of their products in plain English. Besides making the products more transparent, that would also empower consumers to make apples-to-apples comparisons between their different options—something that's almost impossible now. This would take the well-crafted APR standardization and extend that principle throughout the banking and credit card industry. If the banks and credit card companies have nothing to hide, why are they lobbying so hard to defeat the formation of this agency? Let's not forget which entities are most responsible for the economic crisis the world is now battling.

The agency could also require banks to offer a "plain vanilla" version of their products with no extra features or add-ons—for example, a 30-year fixed rate mortgage with a 20% down payment. That way banks can't dupe consumers into taking on more risk than they want or are thinking they are actually taking on.

But Wall Street and the Big Banks are going all out trying to stop this. They've even gone so far as to start a new campaign that will protect against a supposed "populist overreaction." Again, what are they trying to hide?

ENOUGH IS ENOUGH ! ! ! THE COUNTRY NEEDS THIS AGENCY TO OVERSEE THE BANKS AND END THEIR SOCIALLY AND ECONOMICALLY DAMAGING BEHAVIOR ! ! !

Banks and Wall Street will continue to make their money; such an agency will make them earn it in a more honest and open manner. How could that NOT be in the best interests of the country?

I will appreciate your comments as well as updates on how you approach and deal with this issue.

Thank you.