Washington, DC—The passage of the “Restoring American Financial Stability Act of 2010” (S. 3217) represents a strong step forward in the fight to improve the accountability of Wall Street and eliminate deceptive lending practices in communities of color, many of which have been wrongfully steered toward dubious and risky financial services, said NCLR (National Council of La Raza), the largest national Latino civil rights and advocacy organization in the United States.
“We are especially pleased with the Senate for standing up to special interest auto dealers and resisting their calls for a carve-out,” said Janet Murguía, NCLR President and CEO. “Now, the financial well-being of America’s families rests on Congress. While the bill still needs to be strengthened in key areas, it represents a strong foundation on which scams and abuses will be addressed. It’s time for Congress to stand up for Latino families by bringing together the strongest elements of both bills.”
The banking reform bill includes the following provisions that are critical to Hispanic families:
Establishes a new agency, the Consumer Financial Protection Bureau (CFPB), dedicated to enforcing consumer protection laws. CFPB will also keep its pulse on emerging trends of financial abuse and have the ability to write rules to address issues as they arise. Notably, the Senate resisted efforts by auto dealers to create a damaging loophole that would exempt them from the CFPB’s oversight.
Includes new disclosures that create a more transparent process for wiring money abroad. New protections championed by Senator Akaka (D–HI) will create a disclosure that displays the true cost of the remittance and the value received.
Provides expanded access to independent financial advice and guidance. Families need real-time guidance on how to get back on their feet financially. With financial planning services out of reach for most, Senator Menendez (D–NJ) spearheaded the expansion of the Financial Education and Counseling program, which works with credit unions, community-based nonprofit organizations, and Community Development Financial Institutions (CDFIs) to provide free financial advice to empower families to make solid financial decisions and long-term plans for their future.
Promotes access to safe and affordable bank accounts and credit for low-income, minority, and underbanked families. Currently, many Latino consumers rely on fringe financial products such as payday and car title loans to pay their bills and otherwise make ends meet. The bill will provide grants to help families connect to bank accounts and provide funding to CDFIs to create alternatives to payday loans.
As the legislative process moves forward, NCLR urges Congress to reject backdoor deals to strip out fundamental reforms included in the House and Senate versions of banking reform. Instead, members must look for ways to bolster key provisions so that the final bill represents the strongest possible reform for American families. NCLR will continue to work to strengthen reform policies in the best interest of American families.
“We are now one step closer to establishing a banking system that puts families on the path to a more secure financial future,” concluded Murguía.
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NCLR The largest national Hispanic civil rights and advocacy organization in the United States, NCLR works to improve opportunities for Hispanic Americans. Through its network of nearly 300 affiliated community-based organizations, NCLR reaches millions of Hispanics each year in 41 states, Puerto Rico, and the District of Columbia. To achieve its mission, NCLR conducts applied research, policy analysis, and advocacy, providing a Latino perspective in five key areas: assets/investments, civil rights/immigration, education, employment and economic status, and health. In addition, it provides capacity-building assistance to its Affiliates who work at the state and local level to advance opportunities for individuals and families.