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Big business: Go slow on consumer bureau

By Jennifer Liberto, senior writer


WASHINGTON (CNNMoney) -- As Treasury gets the new consumer financial protection bureau up and running, big business groups released a wish list Tuesday for what they think the new agency should do.

At the top of the list is directing the bureau to stay narrowly focused on banks and financial services. But they also think the bureau shouldn't go proposing or enforcing any new rules of the road until the Senate confirms its first director.

"We're not trying to create an indefinite delay, but we are asking for a pause" until a new director is confirmed, said Jess Sharp, who directs the U.S. Chamber of Commerce Center for Capital Markets Competitiveness.

The Consumer Financial Protection Bureau was the signature piece of the Dodd-Frank Wall Street reforms passed last year. It's a brand new independent agency tasked to regulate mortgages and credit cards.

The main theme of the business groups' suggestions is to keep the bureau targeted on regulating banks and financial companies, and to avoid burdensome and duplicative regulations.

"Targeted regulation to weed out bad actors is good for consumers, but there's huge and ambiguous authority granted under Dodd-Frank," Sharp said. "That can lead to huge regulatory burdens for Main Street businesses."

While the new law gives the bureau broad power to supervise businesses that aren't banks, the business groups say they don't think the bureau should go that route any time soon.

"Deferring an expansion of supervision and examination requirements would allow businesses to devote resources to job creation rather than save them to cover what might well be unnecessary regulatory compliance costs," the letter said.

The consumer bureau is in a set-up phase, overseen by Harvard University professor Elizabeth Warren, who is an administration adviser -- and not subject to Senate confirmation. The bureau is scheduled to stand on its own July 21.

Lawmakers, particularly Republicans, have grumbled about Warren's role in setting up the bureau and have been clamoring for President Obama to send them an appointee.

Warren came up with the original idea for the consumer bureau and had been viewed as a likely candidate to direct the bureau. But she's also a controversial potential nominee, due to her tough and loud advocacy for consumers and anti-Wall Street rhetoric.

The business groups say the bureau should defer even proposing new rules, as well as any kind of enforcement to carry out the new laws, until the Senate confirms a new director.

But such a delay could hold up the bureau's progress for months if the political parties take too much time fighting over a potential nominee.

"We certainly don't want a long drawn-out process, but we also don't want a situation where there's a brief burst of regulation from Treasury and then we have a director who may want to head in a different direction," Sharp said.

The business groups that released recommendations include some who lobbied to kill or curb the consumer bureau last year, such as the chamber, the Financial Services Roundtable, International Franchise Association and Association of Settlement Companies, among others. To top of page

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