Halloween 2010 may be over, but financial institutions might still be scared if they've been reading the recent remarks of Elizabeth Warren, the former Harvard University law professor who is helping to "stand up," to use her term, the new federal consumer protection bureau.
Warren has unfolded a picture of an agency that's little like the current Washington bureaucracies that have become "captive," another Warren term adopted from academia, by the industries they’re suppose to regulate.
The new bureau, she says, will be "responsive to the dynamics of our time." It will use technology to collect data from not only financial institutions, academic studies and independent research, but also the public. The bureau will use the data to act as "the cop on the beat watching huge credit-card companies, local payday lenders and others in between."
Here are two more snippets from a recent Warren speech:
Even before the agency officially opens its doors, it can solicit information from the American people about the challenges and frustrations that they face with consumer financial products day in and day out -- and it can organize that information and put it to good use. Data from the public can inform priorities, and it can signal problems both to consumers and businesses.
The agency can empower a well-informed population to help expose, early on, consumer financial tricks. If rules are being broken, we don't need to wait for an expert in Washington to wake up. If we set it up right from the beginning, the agency can collect and analyze data faster and get on top of problems as they occur, not years later.
Of course, rhetoric comes easier than action, and it will won't be until years from now that we’ll be able to assess whether the new bureau lives up to this vision.
That said, it certainly sounds like there's soon to be a new sheriff in town, and one who's determined to serve the public and not to be co-opted by the financial institutions.
What's your take?