Dodd at it again

The Senate Banking Committee unveiled a new bill to reform regulations for the US financial system. The bill, drafted by committee chairman Chris Dodd (D-Conn.), would create the Consumer Financial Protection Agency, which provides consumers information when they shop for mortgages, credit cards and other products. The agency would prohibit hidden fees, abusive terms and deceptive practices. Sounds good, but if Dodd is involved you just know it's going to be bad for business. Says Dodd, in a typical example of non-speak: “this proposal will create a new architecture to make our financial institutions more transparent, more responsible, and more accountable to the American people. It will address the problems of the past, and look forward to the needs of the future.” The American Bankers Association (ABA), which represents banks of all sizes and charters, released a statement saying that they even though they had supported extensive regulatory reform, this draft “would tear apart the existing regulatory structure only to create a new one that would produce conflicts among regulators, undermine the state-chartered banking system, and impose extensive new regulatory burdens on those banks that had nothing to do with creating the financial crisis.” The ABA added: “Many experts have correctly said that we need to return home again, focusing on more traditional banking that is based on sound practices and effective regulation. However, Sen. Dodd’s proposal would make this traditional banking home increasingly unlivable.”