U.S. Consumer Financial Protection Bureau hopes to attract consumer watchdogs
Consumers, not just federal regulators, are likely to be watchdogs of financial abuses for the new U.S. Consumer Financial Protection Bureau.
The bureau was established as part of the financial overhaul in the 'Dodd-Frank Wall Street Reform and Consumer Protection Act'.
Officials who are organizing the bureau say online technology will create a forum for public information, and be a big part of how the bureau will function. This could help millions of consumers blow the whistle on defective financial products, experts say.
"People can tell us their experiences," said Elizabeth Warren, the Harvard professor who is building the agency. "We can aggregate that information into usable data and begin to analyze where problems are emerging, where the hot spots are."
This financial version of "crowd-sourcing" will allow consumers to bypass the usual red-tape of consumer protection, and instead serve as their very own information foot soldiers.
"When people decide that there's a problem and they want to identify a lender, whom they believe has misbehaved, or a particular new trick that has emerged, it's not only about telling the agency, it's about telling each other," Warren said.
Warren and others acknowledge some consumers there may be some hurdles - for one thing, they may have concerns freely sharing their experiences and personal information with the government.
Tim Duncan, chairman of Business Leaders for Financial Reform, wants to see the new bureau push for online access to your credit card or mortgage agreements, in case there's a dispute.
"It's just a great opportunity for somebody to be able to have in one place, hopefully a couple of clicks away, access to every agreement they have and what their obligations are so they can understand it fully when they need to," he said.
Marketplace reporter David Brancaccio contributed to this report.