U.S. Chamber Now Targets Senate Finance Reform Bill

It orchestrated an expensive and ambitious campaign against a Consumer Financial Protection Agency, but the U.S. Chamber of Commerce lost that bid on Friday when the House passed its financial oversight reform bill,  and the new agency along with it.

Now the U.S. Chamber, representing more than 3 million small-to-medium businesses and organizations, is fixing its sights on the Senate version of financial regulatory overhaul, and hoping to convince moderate Democrats to downsize the CFPA’s regulatory reach and fine-tune legal ambiguities.

“While we are disappointed with House passage of a 1,300-page financial regulatory reform bill that leaves many of the underlying issues unaddressed, we are encouraged that there is growing recognition that there is a  better way to overhaul our outdated, financial regulatory system,” the U.S. Chamber said in a statement posted to its website after Friday’s House vote. “We now look forward to working with the Senate to advance more effective reforms that will protect investors and strengthen our capital markets without adding new layers of bureaucracy on top of the current system.”

As soon as President Obama earlier this year announced the proposed creation of a new agency/overseer for the financial industry, the chamber set the wheels in motion for its opposition, culminating with multi-million TV ad campaigns and critical studies. One major study found that the CFPA could hinder small business lending and create legal challenges at state and local levels.

The chamber noted some success in its Friday statement, saying that two amendments it supported were added to the House reform bill. The amendments would:

• Add a preemption standard for the CFPA that will go a long way in fostering consistency in consumer laws and disclosure, and;
• Preserve the ability for companies across the country to prudently manage their day-to-day risks.

In its statement, though, the chamber spared no punches in its still-vigorous opposition to the CFPA:

“This legislation was written with far-too-broad definitions and vague regulatory standards, exposing businesses to excessive regulation and potential litigation,” the chamber said. “The uncertainty surrounding these regulatory standards and increased liabilities will create significant disincentives for institutions that lend to consumers, restricting access to credit and increasing the price of credit for consumers.”