Nation's top bank regulator favors banks over consumers

[eridani]

http://www.alternet.org/story/146085/obama%27s_us_top_cop_for_banks_wants_less_regulation%2C_echoes_republican_wall_st._pals?page=entire

Right now, the only demographic in the U.S. that is less popular than Wall Street bankers are the lobbyists who work for Wall Street bankers. What's shocking about Boehner's statement isn't the sentiment -- anybody paying close attention to the financial reform debate knows that every Republican has been in the bank lobby's camp since well before the crisis broke. Boehner has to know that siding with the same banks that screwed the public on their houses, their credit cards and their retirement is not a good idea. But Boehner believes the bank lobby is so powerful he's willing to publicly encourage the group to work with Republicans to fight against popular reforms.

Tragically, Boehner appears to be right. The bank lobby spent over $463 million lobbying Congress in 2009 according to the Center for Responsive Politics. Yet even after the worst financial crisis in history, the Senate didn't even start considering a reform bill until this week. Along the way, President Obama and Democrats in both the House and the Senate made a string of pointless concessions to the bank lobby, effectively gutting several key reforms. Republicans, meanwhile, have won electoral contests in Virginia, New Jersey and Massachusetts.

But the comments from Comptroller of the Currency John Dugan, the nation's top bank regulator, were just as outrageous as Boehner's public oath of fealty to the ABA. Dugan, whose agency completely failed to protect consumers from predatory lending both before and after he took over as its head, actually argued that we have too much consumer protection in the U.S. regulatory system.

"In every case consumer protection has the edge and will trump safety and soundness, and I think that is backwards," Dugan said, according to a Business Week report.

"Safety and soundness" roughly translates to bank profitability. Dugan couldn't have the relationship between profits and consumer protection any more wrong. In 2009, credit card companies had jacked interest rates through the roof, banks scored almost $40 billion in overdraft fees, and a whopping 2.8 million homes were in foreclosure at year-end. That overdraft fee number is about triple the banking industry's combined profit for the year. The main line of business in American banking is consumer predation. The nation's largest banks, by contrast, scored epic bailouts and paid out epic bonuses.

Dugan doesn't even see a pressing need for action on overdrafts. He told reporters yesterday that he thinks "the jury is still out" on whether banks should be held accountable for overdraft fees.

[eleny]

1. Dugan's five year term is coming to a close soon

According to the OCC site, he was sworn in August of 2005. The COC is appointed by the president.

Fingers crossed that a new person will be appointed by Pres. Obama and then approved by the Senate.

"The OCC was established in 1863 as a bureau of the U.S. Department of the Treasury. The OCC is headed by the Comptroller, who is appointed by the President, with the advice and consent of the Senate, for a five-year term. The Comptroller also is a director of the Federal Deposit Insurance Corporation and NeighborWorks® America."
http://www.occ.treas.gov/aboutocc.htm

[eridani]

2. In that case, it would be a very good move to press Obama to appoint someone better

Starting early would demonstrate that the public is watching.