The Consumer Financial Protection Bureau was created in part as a reaction to the lending abuses that were rife during the run-up to the financial crisis.
"Everyone now understands that strong consumer protections are part and parcel of a strong economy. If you abuse consumers, who account for seven out of every 10 dollars spent in the economy, you're headed for a problem," says Kathleen Day, a spokeswoman for the Center for Responsible Learning.
Day says the problem with consumer protection has never been a lack of laws; it's been a lack of enforcement. The new agency aims to fix that by concentrating enforcement by all the government's financial watchdog agencies under one roof.
The act charges the agency with acting on consumer complaints, conducting investigations and putting dishonest companies on trial. To make sure groups frequently targeted by crooked lenders -- minorities, seniors and active military personnel -- are protected, special offices will be formed within the Consumer Financial Protection Bureau to investigate complaints on their behalf.
Lenders who are found to have abused consumers can be fined or sued for damages by the bureau, or referred to the Justice Department for prosecution.