Raj Date, the Consumer Financial Protection Bureau’s special adviser, updated the House Financial Services Subcommittee on Financial Institutions and Consumer Credit on Wednesday, saying the CFPB is off to an “exceptional start.”
Date broke his testimony down to three areas. He said the bureau is focusing on transparency in financial markets, enforcement through clear exam procedures and engagement through consumer empowerment, ABA.com reports.
“One of the CFPB’s primary objectives is to bring clarity to the marketplace by promoting easy-to-understand disclosures that make prices and risks clear up front,” Date said. “This will ensure that consumers get the information they need to make the financial decisions they believe are best for themselves and their families.”
Date used the mortgage industry during the housing bubble as an example of poor transparency. The potential costs and risks were not clearly understood, Date said, which led to consumers ending up with mortgages they couldn’t afford.
Date also blamed the mortgage market for not following the rules and failing to protect consumers from harmful practices.
“Because federal and state rules created a fragmented system of mortgage regulation, supervision and enforcement, the mortgage market became an un-level playing field that encouraged irresponsible lenders to shop for the most permissive – or least monitored – legal regime,” Date said.
The CFPB has published its Supervision and Examination Manual, which provides direction to its examiners how to determine if providers of financial products and services are complying with Federal laws.
The bureau has also been making strides to empower consumers, especially seniors, service members and students.
Date said the CFPB is empowering these groups by “providing educational materials tailored to these groups’ particular needs and situations and addressing unfair, deceptive and abusive practices targeted against them."