[Congressional Record Volume 156, Number 101 (Thursday, July 1, 2010)]
[Extensions of Remarks]
[Pages E1262-E1263]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   CONFERENCE REPORT ON H.R. 4173, DODD-FRANK WALL STREET REFORM AND 
                        CONSUMER PROTECTION ACT

                                 ______
                                 

                               speech of

                        HON. SHEILA JACKSON LEE

                                of texas

                    in the house of representatives

                        Wednesday, June 30, 2010

  Ms. JACKSON LEE of Texas. Mr. Speaker, I rise in strong support of 
H.R. 4173, ``the Restoring American Financial Stability Act of 2010'', 
also known as ``the Dodd-Frank Act.'' This historic bill will go a long 
way to address a variety of defects and shortcomings currently seen in 
our financial services system. It is a major step towards meaningful 
``measured'' government regulation to protect the interests of 
consumers, investors and everyday working Americans. After years of 
consumer mistreatment, fraud, and abuse, this bill represents the first 
principled effort to bring financial fairness to all Americans and to 
ensure that financial transactions be both honest and transparent.
  One of the strongest provisions designed to protect the consumer in 
this legislation is the formation of an independent Consumer Financial 
Protection Bureau, CFPB, empowered to write rules for most consumer 
financial transactions. Existing consumer-protection authority is 
currently scattered and largely ignored by existing financial 
regulators. This Act will consolidate these authorities in the CFPB, 
and give the bureau teeth in exerting its power to enforce these 
protections. With this newly defined power, the creation of the CFPB 
will usher in a new era of oversight. I urge Congress to stand tall and 
create a society where unfair practices are stopped before they become 
pervasive, where the average consumer is protected from fraud and 
abuse, and where big bank bailouts are prevented before they come at 
the expense of taxpayers.
  Another major provision in this bill is the establishment of broad 
statutory protections against abusive mortgages. These provisions 
include; requiring lenders to evaluate borrowers' ability to repay 
loans before and after teaser rates have expired; banning prepayment 
penalties that lock borrowers into high-cost loans; prohibiting 
incentives to steer borrowers into higher-cost loans that they don't 
even qualify for; limiting total fees for most loans; and banning 
mandatory arbitration clauses for mortgages.
  In addition to these key provisions, this bill will also create a $1 
billion emergency loan fund to help families at risk of losing their 
homes due to unemployment or illness. Because unemployment--9.7 percent 
is partly a direct result of the reckless lending and collapse of the 
housing and financial markets, this fund is especially important in 
reversing these negative economic effects and providing assistance to 
those who have been hurt by unfair practices. A recent Center for 
Responsible Lending, CRL, report found that, unfortunately, the 
foreclosure crisis is far from over. Foreclosures are likely to 
continue to climb and losses will continue to increase, further 
burdening our economy and financial services system, unless the 
government decides to intervene by passing this Act.
  The bill also addresses bank interchange fees, the fees charged on 
debit card transactions. Under the bill, such fees would be reduced. 
While the banks and credit unions opposed any reduction in fees as 
embraced by the Durbin amendment, the arguments advanced by the 
retailers won the day. While I support credit unions, which are the 
backbone of many communities and have traditionally served the special 
needs of teachers, public service employees and the average government 
worker, about the use of the fees to cover many bad transactions 
related to their debit card business, the fees generated by the debit 
card transactions represent a major profit making activity for the 
banking industry. These fees are generally passed onto the consumer in 
the form of higher retail prices. Interchange

[[Page E1263]]

fees also tend to fall disproportionately on minority and low-income 
consumers by making them pay higher prices.

  Another issue the bill addresses is the underrepresentation of 
minorities and women in the financial services industry. The bill 
requires each of the federal financial services regulatory entities to 
establish Offices of Minority and Women Inclusion. These Offices will 
facilitate the participation of minority and women-owned business in 
nontraditional types of financial activities, something long overdue. 
In addition, the bill requires expanded efforts to recruit and to 
retain minority and women financial services professionals, 
traditionally excluded from the upper ranks of management in most of 
the federal financial services regulatory entities.
  The bill preserves the role of community banks, recognized for their 
positive lending habits to small business and other major community 
stakeholders. These banks can always be counted on to lend for 
nontraditional purposes, while maintaining flexible lending standards 
based on risk assessment as it relates to a person's background and 
ties to the community. Many of these banks continued to lend during the 
liquidity crises, making it possible for small businesses to make 
payroll and for people to continue to pay their mortgages. Community 
banks remain pillars of strong communities and neighborhoods throughout 
this Nation, and this bill acknowledges their important role in the 
economy.
  Further, the bill brings much needed sanity to the derivatives 
markets by requiring more rigorous standards related to over-the 
counter derivatives; provides new rules related to transparency and 
accountability and our nation's credit agencies; institutes new 
mechanisms to avoid bank bailouts of financial firms that threaten the 
economy; and reforms the Federal Reserve by requiring greater oversight 
and transparency in its transactions.
  Mr. Speaker, this Act is of extreme importance to the consumer, the 
investor, to the average American, and to the Nation's economy as a 
whole. It is time to end the Wall Street ``joy ride'' and give the 
American people the protections and information they need to be better 
informed consumers and investors in this highly technologically driven 
economy. The way the average consumer, borrower, and home-owner have 
been targeted by many of our Nation's financial institutions and 
lenders makes this legislation all the more important. These practices 
must end. H.R. 4172 will stop many of them. For these reasons, I urge 
my Colleagues to make the changes in our laws to protect the American 
people and to help strengthen the U.S. financial system.

                          ____________________