July 16, 2010 – National Urban League President and CEO Marc H. Morial today praised the Senate for passing much-needed banking reform legislation.
“The bill passed by the Senate and sent to President Obama will help protect America’s families from predatory lending practices and guard against the risky practices that landed the nation in its current financial crisis,” Morial said.
Morial noted that communities of color have been disproportionately affected by the financial crisis, and stand to gain the most from provisions like the newly-created Consumer Financial Protection Bureau and the additional investments in the Neighborhood Stabilization Program. The creation of the Office of Minority and Women Inclusion will address the need for diversity in the workforce of regulators and in contracting, he said.
“American consumers, particularly those in at-risk communities, already have paid too steep a price for Wall Street’s reckless behavior over the last decade,” Morial said.
Morial praised President Obama for his persistence and dedication to getting the legislation passed.
“I also want to acknowledge the tireless efforts of Senator Chris Dodd, Rep. Barney Frank and especially Rep. Maxine Waters, whose amendment created the Office of Minority and Women Inclusion,” Morial said. “We are extremely grateful to those who worked with Rep. Waters – affectionately known as the ‘Titanium Ten’ to include this important provision.”
Morial noted the unfortunate fact that it took 60 votes to pass the legislation, an all-too-common condition in the Senate of late.
“Obstructionists in the Senate are working overtime to protect the wealthy and influential at the expense of average Americans who are struggling to get by,” he said. “We desperately need to change the legislative culture and work together to stabilize our economy and support the working class.”
In addition to the neighborhood investments, women and minority inclusion and the new consumer financial protection bureau, which will regulate financial products and protect consumers from predatory practices, the legislation includes:
- A resolution authority for the federal government to ease failed firms through the liquidation process — an authority former Treasury Secretary Hank Paulson says would have helped him and the country a great deal during the financial crisis of 2008.
- A requirement that large institutions move risky derivatives-trading businesses into external affiliates, where taxpayers will not be required to cover the risk.
- Prohibitions on conflicts of interest on Wall Street, limits the extent to which big banks can make risky trades with their profits.
- And thorough auditing of the Federal Reserve’s non-monetary policy operations, including its response to the deepening crisis in 2008 .
Morial said the National Urban League has worked for several years on ending predatory lending practices and reforming the lending industry; he was pleased to see the legislation addressed several of the recommendations in the National Urban League’s Homeowner’s Bill of Rights, first released in 2007. These include :
- The Right to be Free from Predatory Lending (Elimination of incentives for lenders to make predatory loans; a fair, competitive market that responsibly provides credit to consumers; access to justice for families caught in abusive loans; and the preservation of essential federal and state consumer safeguards)
- The Right to Truth and Transparency in Credit Reporting (Demystify the credit reporting system through education and awareness and establish of a penalty structure for credit reporting bureaus that maintain inaccurate client files)
- The Right to High-Quality Homeownership Education (Redesign of an industry-wide system that integrates pre- and post-purchase homeownership education and counseling; and expansion of HUD’s budget for housing counseling)
- The Right to Fairness in Lending (Require lenders to gauge ability to repay and offer borrowers the most affordable and well-suited products for which they qualify)
“I applaud the Senate for taking this important step and addressing the needs of the working and middle class Americans that are the backbone of our economy,” Morial said.
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