CFPB Deputy Director Steve Antonakes told the National Community Reinvestment Coalition at its annual conference that banks, credit unions and nonbanks “should be treated alike… if they offer the same types of financial products and services.”
“As a veteran of two banking crises, I can tell you unequivocally that, in my view, consumer protection is not in conflict with safety and soundness,” Antonakes said. “Consumers benefit from a healthy, competitive and diversified financial services system through greater access to credit and competitive pricing.”
Antonakes said, however, compliance with regulatory requirements depends on “strong management.”
“Seldom do institutions excel in one and not the other,” Antonakes said. “No business built on deceiving its customer base will be sustainable. Moreover, when businesses underinvest in compliance management systems, it can pose significant reputational and financial risks. There is no better evidence than the banking industry’s ongoing recovery from a significant underinvestment in internal control systems relative to mortgage origination and servicing.”
Antonakes said a “renewed and appropriate focus” on consumer protection will help to prevent issues that contributed to the financial crisis.
“Our goal is that this will allow substantial opportunities for all responsible companies to innovate and compete in the marketplace,” Antonakes said. “Put another way we are attempting to recalibrate the relationship between consumers and financial service providers by ensuring it is grounded in fairness, transparency and choice.”