In an attempt to win broader support for emerging legislation to reform the financial industry, House Financial Services Committee Chairman Barney Frank (D-MA) moved to change one of the proposal’s more controversial provisions – the creation of a Consumer Financial Protection Agency (CFPA).
The Chairman’s proposed changes include dropping provisions to require companies to offer “plain vanilla” loans and other financial products as an alternative to more complex ones, such as variable-rate mortgages. In addition, the proposal would exempt non-financial businesses such as retailers, lawyers and doctors from the CFPA’s oversight, instead focusing the new agency’s powers solely on financial companies.
The changes were released by Chairman Frank earlier in the week, and were met with support from Treasury Secretary Timothy Geithner during his testimony before the Financial Services Committee on Wednesday. They were put forth in an attempt to alleviate opposition from various interest groups representing the above-mentioned industries.
Despite recent reports that the Senate may not take up financial regulatory reform until the new year due to a packed legislative schedule, Chairman Frank reiterated his committee’s intention to move a bill to the House floor this year. According to the Chairman, the Financial Services Committee will mark up legislation in October, with floor consideration in November.