Chairman Rockefeller's Remarks on Financial Services and Products: The Role of the Federal Trade Commission in Protecting Consumers

February 4, 2010

JDR Head ShotWASHINGTON, D.C.—Today, American consumers are hurting. Many have lost their jobs, foreclosures are up, and in tough economic times family budgets are tight.

And in the midst of all of this pain, unscrupulous business practices continue to target consumers directly when they can least afford it.

It’s difficult for the average consumer to know who to trust and we need to change that.

We are doing everything we can to weather these storms. More people are beginning to find work, and Congress is fighting to create more jobs.

I believe we cannot forget how we got here: many of the enormous economic problems we face today are a direct result of weak consumer protections in the financial sector.

President Obama has proposed creating a new agency to better regulate the financial sector, and better protect consumers.

And today’s hearing is our chance to look closely at the Federal Trade Commission in particular and its role as top cop on the beat.

We must identify the enforcement and oversight tools the FTC needs to most effectively protect consumers in the 21st century economy.

I firmly believe the FTC must remain a cornerstone of our consumer protection system.

For too long, deceptive financial products, criminal investment schemes, and a reckless faith in the industry’s ability to regulate itself, have significantly undermined our economy.

The world of financial products is extraordinarily complex and getting more so every day. Consumers are overwhelmed by countless choices, indecipherable fine print, and grand claims.

And, as more and more of these products are created beyond the domain of local banks, our current regulatory structure simply cannot oversee them.

Too often financial regulators overlook financial products outside of traditional banks – and ordinary Americans have paid the price. This is where the FTC can and should play a leading role.

Over the last five years, the agency has brought more than 100 cases to protect consumers from abusive financial practices.

These cases have run the gamut from routine settlements with fly-by-night payday loan operators to resource intensive litigation with major mortgage servicing companies.

The common thread that runs through each investigation is an unwavering focus on the American consumer.

Now, even as our government responds and adapts to the frequently changing realities of our tremendously difficult modern economy, we can never lose that focus, never forget who comes first.

As anti-consumer activities continue to surge, we need every weapon at our disposal to take them on.

The Federal Trade Commission Act’s longstanding general prohibition against “unfair or deceptive acts or practices” has become the bedrock of consumer protection laws in the United States. Now it is time to shore up that foundation.

I want to close by saying that when I took over this committee just one year ago – I vowed to make this a Committee focused on protecting the consumer.

I am proud to say we have investigated a number of scams from online merchants who share their customers’ credit card information without first receiving real consent to insurance companies putting profits before people.

For all the companies out there looking to rip off the hard working people of this country, I say to them that this Committee is only getting started in its efforts to safeguard the people from misleading practices.

We will not stop until consumer protection is a cornerstone of our thriving economy as I know it can and should be.

Finally, I want to recognize the importance of quickly confirming Julie Brill and Edith Ramirez, the president’s recent nominees to join Chairman Leibowitz as Commissioners of the FTC so they may get to work.

Thank you Chairman Leibowitz for your work to make the FTC the strong agency consumers need. We need to hear from you on how we can better equip the FTC to protect the American people. I look forward to your testimony.