Critics hit Senate tilt toward Fed status quo
Author: Kevin Drawbaugh, Reuters
Mar 08, 2010
"Senators leaning toward preserving the Federal Reserve's role as a bank supervisor and consumer protection regulator came under criticism on Monday from academics and consumer activists.
'Allowing the Fed to retain policing authority over the country's 23 largest banks ... and including responsibility for a new consumer protection agency is a bad idea,' said Mark Williams, a lecturer at Boston University's management school.
'Irresponsible Fed actions supplied gasoline that ignited the financial crisis,' he said. 'Instead of rewarding the Fed for a job poorly done, Washington policy-makers should not reward unacceptable regulatory behavior.'"
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"Complex mortgage features, such as payment options, negative amortization resets, and underwriting loans only at the initial 'teaser' rates, as well as the complexity of many disclosure documents provided an opportunity for unscrupulous operators to take advantage of borrowers."
Source: Michael H. Krimminger, Special Advisor For Policy, Office Of The Chairman; FDIC
