CFPB: Championing the Rights of Consumers
US consumers are faced with a host of options when it comes to making purchases, applying for a mortgage, selecting personal banking services, and using credit cards and other financial services. The economic turmoil of the past two years or so has brought to the attention of authorities that not all consumers are equipped to make financial decisions in their own best interests. This has led to the formation of the Consumer Financial Protection Bureau (CFPB) which, under the jurisdiction of the Federal Reserve, regulates financial products and services offered to consumers, ensuring compliance with federal law, while at the same time educating consumers to enable them to make informed financial decisions.
The core function of the CFPB is to ensure that consumers have the necessary information to understand the fine print of agreements they may enter into with financial providers. The Bureau also undertakes to make regulations for consumer financial product providers as clear and simple as possible to avoid misunderstandings and encourage self-regulated compliance. Moreover, the CFPB aims to restrict deceptive and unfair practices; investigate consumer complaints; promote financial education; conduct research into consumer behavior patterns; monitor financial markets to detect possible risks to consumers; and enforce laws relating to discrimination and other unfair practices in consumer finance.
Under the leadership of Professor Elizabeth Warren, the CFPB Implementation Team works toward fulfilling its functions by meeting with consumer groups and financial services providers to address problem areas; training other teams that will have the responsibility of enforcing consumer financial laws as stipulated by the Federal Reserve; laying the groundwork to write new rules as required by the Dodd-Frank Act; and handling complaints from consumers. The CFPB is also responsible for overseeing offices offering specialized assistance to specific groups of consumers such as Financial Protection for Older Americans, and Service Members Affairs.
Consumers are considered to be the lifeblood of the US economy, and protecting consumer rights will not only benefit individual citizens, but will encourage healthy competition between financial providers and retailers selling on credit. The CFPB aims to ensure that consumers are presented with the true price of the product or service they are buying, thus allowing them to make comparisons and choose the option that is best for them. With the Consumer Financial Protection Bureau championing the rights of consumers, hiding costs and unreasonable terms in the fine print is no longer an option for unscrupulous dealers.