FTC Tells Congress Changes in Law and More Resources Would Enhance the Agencys Consumer Protection Efforts in Financial Services Markets

The Federal Trade Commission today told the U.S. House Subcommittee on Financial Services and General Government of the Committee on Appropriations that the FTC has intensified its efforts to protect consumers in financial services markets, and that changes in the law and additional resources would enhance the agency’s effectiveness.

FTC Chairman Jon Leibowitz testified that the economic crisis has had devastating effects on consumers’ ability to obtain credit, make their credit payments, and maintain their credit ratings. Federal agencies need to more effectively police the financial services industry, the testimony stated.

The testimony noted that the Commission has brought more than 70 financial services consumer protection cases in the past five years, focusing on foreclosure rescue and loan modification scams, mortgage servicing, fair lending, credit advertising, debt collection, debt settlement, and credit repair. The FTC also has provided consumer and business education, and undertaken research and policy development in the financial services market.

The FTC is committed to protecting consumers in the broader credit marketplace, the testimony stated. To enable the Commission to perform a greater and more effective role protecting consumers of financial services, the testimony recommended changes in the law and additional resources to enhance the agency’s authority to promulgate needed rules, prosecute cases against law violators, and conduct critical research.

The Commission vote authorizing presentation of the testimony and its inclusion in
the formal record was 4-0.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,500 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics.

(HouseAppropsTestimony)
(FTC File No. P064814)