As the White House aims to regulate non-bank financial agencies, U.S. Senators are considering the nomination of Richard Cordray to act as head of the Consumer Financial Protection Bureau, Inside Arm reports.
According to the recently released Improving Americans' Financial Security report released by the White House, the government must nominate a CFPB head in order to fully implement the Dodd-Frank Wall Street Reform and Consumer Protection Act. As it stands, reliable short term lenders and short term financing agencies are overshadowed by the unlawful practices of a select few financial firms. In order to allow the consumer to have complete trust in the industry, a "supervisor" must oversee the non-bank financial agencies. "CFPB’s inability to exercise its full authority while it awaits a director affects the lives and financial security of tens of millions of American families who rely on non-bank financial institutions for their financial needs," the report stated. "Indeed, whether it is shopping for a mortgage or private student loan, or having one’s credit report used in a lending decision, many middle class families are reliant upon non-bank financial actors." Although there was an influx of new jobs during November that helped dip the unemployment rate to 8.6 percent for the first time in over two years, 14 million Americans remain without a job, many of which rely on short term financing solutions to pay for their family's immediate needs. In addition, economic growth won't be immediate, as noted by George Buckley, chairman and chief executive of 3M. According to Buckley, because of the economy's recent experience with the recession period during 2008 and 2009, a repeat downfall is unlikely. In addition, major economies are unlikely to follow suit with the debt crisis that ensued throughout Europe. 3M expects its sales to pick up during 2012, but gains will be moderate, due in part to the natural disasters of Thailand and Japan that the automotive and technological industries are still recovering from. Although short term loans may not be an individual's first avenue of monetary relief, in times of dire need they do provide a reliable method of payment. With legislation pending on expanded oversight by the government on non-bank financial agencies, the industry's reputability should attract more consumers.