The Consumer Financial Protection Bureau needs to establish "clear goals that make sense to the American people," according to Elizabeth Warren who has been charged by President Obama to set up the new agency.
She noted that the Food and Drug Administration, and Consumer Product Safety Commission enjoy widespread public support because they "limit the risks that consumers cannot detect on their own," adding that these agencies "make the markets they regulate more efficient."
CFPB needs to adopt similar goals, Warren told a Consumer Federation of America Washington conference this week.
She stressed that the credit market is "broken" because customers cannot tell the price or risk of a financial product or compare it with other offerings.
"Prices should be clear up front and risks easily explained," she said, allowing consumers to easily "compare one mortgage with three other mortgages."
The former Harvard professor championed the creation of the CFPB over the past two years. The White House named her special assistant to the Treasury secretary to set up the bureau after it became clear that Senate Republicans would block her confirmation to be the first CFPB director.
Warren told CFA members that the consumer watchdog agency will continue to face opposition from financial firms and members of Congress.
Without CFA's continued support, the new bureau will be "vulnerable" to efforts to cut the agency's funding and "deny its effective place in government," she said.
