N.C. advocate for poor to lead creation of Consumer Financial Protection Agency

The (Raleigh) News & ObserverJune 30, 2009 

RALEIGH — Eric Stein started out making loans to promote home ownership among poor people in this state. In the process he became an activist fighting shady lending practices to the low-income people he was trying to help.

Now Stein, 47, has parlayed his experience fighting mortgage scams and other lending abuses into a high-profile position in the Obama administration.

The consumer rights advocate from the Center for Community Self-Help in Durham was recruited to help lead President Barack Obama's goal to create the Consumer Financial Protection Agency. As deputy assistant treasury secretary for consumer protection, Stein runs the U.S. Treasury office that is designing the new agency and will help usher the concept through Congress as it is debated.

"Today we're working on the legislation that would establish the new agency," Stein said in a phone interview Monday from Washington. "The president's agenda is very ambitious, and there's a lot of work to be done."

Stein was tapped for the job this spring after having testified multiple times before Congress. His most recent testimony had touched on the need to protect consumers by stemming the rash of home foreclosures.

He has been at his new job one month and expects to spend his first year getting the new consumer agency started, if Congress approves it.

The proposal for a dedicated consumer agency has met resistance from some Republicans, who are skeptical that another layer of bureaucracy will stop rogue business practices.

But the idea gained momentum in the wake of the subprime mortgage crisis that ultimately led to the global economic meltdown. Stein said that some subprime mortgages contain penalties for paying off loans early, locking homeowners in a high-interest trap. Brokers were paid premiums to steer homebuyers to those kinds of loans, he said.

For the previous 14 years, Stein was chief operating officer at Self-Help, a nonprofit community development lending institution. Self-Help was instrumental in getting North Carolina to pass an anti-predatory lending law in 1999 that is seen as a national model. Stein and his boss, Martin Eakes, traveled to Washington to testify about predatory lending and other topics more than a dozen times over the past decade.

To read the complete article, visit www.newsobserver.com.

McClatchy Washington Bureau is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service