Consumer Financial Protection Bureau architect Elizabeth Warren Monday announced an agreement that promotes cooperation between the federal agency and state attorneys general in enforcing financial laws.
In her remarks to the National Association of Attorneys General in Charlotte, Warren emphasized that half of the nascent agency's resources will be devoted to enforcement. She praised the efforts by attorneys general to investigate foreclosure problems and noted federal banking regulators have often worked at cross-purposes.
"Collaboration between the CFPB and the attorneys general offers tremendous promise," she said in the prepared remarks. "By working together, we can make the whole greater than the sum of our parts."
In a question-and-answer session, Warren also shared details about the first regulation the bureau is developing: a requirement that mortgage lenders provide consumers a one-page, easy-to-read document that would give essential details about the loan's cost before closing.
The CFPB is one of the most significant outcomes of the landmark Dodd-Frank financial reform law signed into law last summer. As an adviser to the Obama administration, Warren is charged with developing the agency, which goes into operation in July. She is also a lightning rod for criticism of the law and its potential impact on the banking industry.
Under Dodd-Frank, state attorneys general are authorized to enforce the federal law and required regulations, with certain exceptions. It gives new firepower to state officials who in the past have found some of their authority "pre-empted" by federal banking regulators.
The agreement announced by Warren is between the CFPB and a working group of attorneys general from six states, including North Carolina. Over time, the goal is to get other states on board and to flesh out more detailed guidelines.
The agreement calls for the development of joint training programs, the sharing of information to develop law enforcement priorities, coordinated investigations and other joint efforts.
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