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Inside Washington (06/19/2009)
* WASHINGTON (6/22/09)--Credit Union National Association (CUNA) President/CEO Dan Mica presented Jean Chatzky, NBC “Today Show” financial editor, with the Consumer Federation of America’s (CFA) 2009 Betty Furness Consumer Media Services Award at CFA’s 39th annual awards dinner in Washington, D.C., Wednesday. Mica underscored Chatzky’s passion for financial education, her ability to explain complex topics and to reach tens of millions of consumer via “The Today Show” and through regular appearances on “The Oprah Winfrey Show,” “Larry King Live,” satellite radio, newspaper columns and magazine articles. From left are Chatzky, Mica, CFA Executive Director Stephen Brobeck and Federal Deposit Insurance Corp. Chairman Sheila Bair, who received CFA’s public service award. CUNA is a charter member of the CFA board. (Photo provided by CUNA) ... * WASHINGTON (6/22/09)--Federal Reserve Board advisory panel members disagreed at a meeting Thursday on how credit card companies should be allowed to create terms in light of new credit card legislation, the Credit CARD Bill of Rights Act, signed earlier this year by President Barack Obama. The legislation aims to crack down on abusive card practices. Given the new rules, credit card company representatives said if they can’t adjust rates on existing balances, they would have to set competitive rates based on an individual’s credit score to mitigate the revenues they receive from defaulting customers (American Banker June 19). They also said they could charge accountholders more fees. Consumer advocates said the companies should not be able to earn revenues through fees. Penalty fees are for guiding conduct and should not be used for companies to earn profit, said Thomas James, senior assistant attorney general for the Illinois Attorney General Office’s consumer fraud bureau. Senate Banking Committee Chairman Christopher Dodd (D-Conn.) warned banks earlier this month against gouging consumers with deceptive or excessive checking account fees (Reuters June 4 via News Now) ... * WASHINGTON (6/22/09)--Senators expressed skepticism at giving the Federal Reserve Board more power under President Barack Obama’s plan to overhaul the financial regulatory system (The New York Times June 19). Senate Banking Committee Chairman said in a hearing last week with Treasury Secretary Timothy Geithner that he was open to giving the Fed more power, but likened the situation to a parent giving a child a bigger car after crashing the family station wagon. Sen. Richard Shelby (R-Ala.) said he thought the Fed had enough responsibilities. Sen. Jim Bunning (R-Ky.) said the Obama plan puts “a lot of faith” in the Fed’s ability to prevent another financial crisis. However, if the Fed and other regulators had done their jobs and saw what banks and other firms did earlier in the decade, the mess could have been prevented, he said ... * WASHINGTON (6/22/09)--Even some who support giving the Federal Reserve Board more authority under the Obama administration’s regulatory revamp plan have noted concerns about what would happen if the Fed’s powers were to be widened (American Banker June 19). If the Fed was granted more power, it would be blamed for things that go wrong, according to Douglas Landy, former Federal Reserve Bank of New York lawyer. There have to be realistic expectations of what it means to be a systemic risk regulator, added Randall Kroszner, former Fed governor. Other observers expressed concern over the Fed losing its independence. Under Obama’s plan, the Fed would be responsible for the financial system, holding companies and all large financial companies. Increasing the Fed’s powers also may mean that the central bank will have to be more involved with Congress, noted Treasury Secretary Timothy Geithner at a hearing Tuesday. However, even if its powers were broadened, the Fed would still have to obtain written permission from the Treasury before it can use emergency lending powers ...


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