Congresswoman Maxine Waters (D-California), Chairwoman of the Housing Financial Services Committee, commemorated the 10th anniversary of the signing of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Waters said she is proud of the work that she and her colleagues did to pass the Dodd-Frank Act following the 2008 financial crisis.
“At that time millions of families had lost their homes to foreclosures driven by unregulated, abusive, predatory lending,” Waters said. “The catastrophic Great Recession also resulted in trillions of dollars in lost wealth and massive job losses. In Congress, Democrats took decisive action to ensure that consumers, investors, and the economy would be better protected from a future crisis.”
She added that this “landmark law” made significant reforms on a wide range of policy fronts, including creating the Financial Stability Oversight Council (FSOC) and enhancing prudential standards for the largest financial institutions to impose robust capital, liquidity, leverage, stress testing, and living will requirements.
“Dodd-Frank also cracked down on risky speculative trading by establishing the Volcker Rule and created a new regulatory regime for the previously unregulated derivatives market. And importantly, we reformed the mortgage market and eliminated certain predatory products,” she said.
The center of the act was the creation of the Consumer Financial Protection Bureau (CFPB) to ensure consumers would have an independent watchdog to protect them from “abusive financial products and practices.”
“Under Democratic leadership, the Consumer Bureau was wildly successful, putting millions of dollars back in the pockets of hardworking consumers who had been ripped off and stopping many abusive acts by financial institutions. But despite those successes, there are those who still want to return to the bad old days, where consumers did not have a watchdog looking out for them, and predatory lending was allowed unchecked,” she said.
The CFPB, however, was recently ruled unconstitutional by the Supreme Court due to its single-director makeup.
“The CFPB’s single-director configuration is also incompatible with the structure of the Constitution, which—with the sole exception of the Presidency—scrupulously avoids concentrating power in the hands of any single individual,” the ruling states.
In response, the CFPB announced that Thomas Pahl will serve as the Deputy Director of the Bureau.
Pahl served as the Policy Associate Director for Research, Markets, and Regulations since April 2018, Previously, Pahl was the Acting Director of the Bureau of Consumer Protection at the Federal Trade Commission (FTC).