Press Releases

Democrats Vote to Authorize Unelected Bureaucrats to Subjectively Ban Commonly Used Financial Products

WASHINGTON, October 21, 2009 -

- During consideration of H.R. 3126, legislation to create a so-called Consumer Financial Protection Agency, Democrats on the House Financial Services Committee defeated an amendment offered by Congressman Jeb Hensarling (R-TX) that would have limited the unprecedented discretion of the Director of the new Agency to ban specific financial products and services that consumers depend on to meet their financial needs.

The legislation confers virtually unfettered discretion on the Director of the CFPA to seek out practices that he or she does not approve of, and ban them, under highly subjective standards that have no legally defined content.  Under the legislation, the Director may "prescribe regulations and issue orders and guidance as may be necessary or appropriate" to prohibit "unfair, deceptive, or abusive acts or practices."

To address this dangerously broad, unchecked delegation of authority, the Hensarling amendment would have eliminated the Agency's ability to prohibit specific products and limit the Agency's powers to policing deceptive acts and practices.  By limiting the Agency's powers to policing against deceptive acts and practices, the Amendment would have ensured that consumers are protected against false and misleading practices, yet can still obtain those products which consumers have determined provide them with some benefit.

The vote on the Hensarling amendment was 28-40. Click here to view a copy of the amendment.

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