WASHINGTON -- Harvard University law Professor Elizabeth Warren, appointed by President Barack Obama to jump-start the new consumer agency that will oversee auto financing, struck a conciliatory tone with bankers last night but ultimately failed to allay at least some concerns about her.
“In the weeks and months ahead, I’m going to listen more than I’m going to talk, and I’m going to keep my door open,” Warren told a private Washington dinner sponsored by the Financial Services Roundtable.
She endorsed a “principles-based approach” to regulation as a substitute for “creating a regulatory thicket of ‘thou shalt nots.’ ’’
This approach “would focus on how to give consumers the power to make the right choices for their families -- and at the same time to ease the regulatory burden for the lenders,” Warren said, according to a text provided by her office.
She gave an example involving credit cards but did not mention auto finance in her remarks.
No confirmation needed
Under the new financial regulation law, the Consumer Financial Protection Bureau is to oversee lenders that help finance consumer auto purchases. It will not police dealers’ role in that financing.
Warren, who conceived of the idea of a federal consumer agency, was named this month as an assistant to Obama rather than director of the bureau, which would have required Senate confirmation.
Bank lobbyists opposed both the creation of the agency and her appointment. Some continued to express concern today.
“Last night’s comments by Professor Warren did little to alleviate the anxiety or uncertainty that surrounds her appointment to a powerful yet undefined post as assistant secretary at Treasury,” said Chris Stinebert, CEO of the American Financial Services Association, which represents captive finance companies and large banks.
He added: “However, auto finance companies can take some solace in the fact that auto finance was not highlighted as a problem area.”
The National Automobile Dealers Association also has expressed concerns about Warren.
NADA Vice Chairman Stephen Wade said last week that her appointment “worries us.”
No comment from NADA
An NADA spokesman today declined to comment about her speech.
Last month, Deputy Treasury Secretary Neal Wolin said the consumer agency soon would begin trying to simplify auto loan forms for consumers.
He said in congressional testimony today that July 21 has been designated as the start date for the new agency.
At that time it will assume existing authority of seven other federal agencies -- including the Federal Trade Commission, which has been overseeing the role of lenders in auto financing, Wolin told the Senate Banking Committee.
Six of these agencies also will transfer staff to the new consumer bureau, he said.