Consumer Protection in an Age of Uncertainty: Opening Remarks (Day 1)

WELCOME TO THE UNIVERSITY OF

MICHIGAN'S FORD SCHOOL AND CFLP 

CONFERENCE ON CONSUMER 

PROTECTION IN AN AGE OF 

UNCERTAINTY.

FOR THOSE OF YOU WHO HAVE NOT 

MET BEFORE, I'M MICHAEL BAR, I'M

THE DEAN HERE AT THE FORD SCHOOL

OF PUBLIC POLICY.

WELCOME TO THOSE OF YOU WHO ARE 

LISTENING ONLINE AS WELL.

WE LOOK FORWARD TO A GREAT 

CONVERSATION TODAY.

WHAT I HOPE WE'RE GOING TO DO 

OVER THE NEXT TWO DAYS IS REALLY

HAVE A LOOK BACK AT WHERE WE'VE 

BEEN IN CONSUMER PROTECTION OVER

THE LAST DECADE.

AND HOPEFULLY ALSO LOOK FORWARD 

OVER THE NEXT TEN YEARS WHERE 

WE'D LIKE TO BE IN A WORLD WHERE

WE CAN BUILD A BETTER SET OF 

CONSUMER PROTECTIONS GOING 

FORWARD.

IF YOU THINK BACK TEN YEARS AGO 

WHEN PRESIDENT OBAMA CAME INTO 

OFFICE, OUR FINANCIAL MARKETS 

WERE FROZEN.

THE COUNTRY WAS LOSING JOBS.

WE WERE FACING THE WORST 

ECONOMIC CRISIS SINCE THE GREAT 

DEPRESSION.

AT THE END OF 2008, THE 

BEGINNING OF 2009, OUR NATION 

WAS LOSING 800,000 JOBS A MONTH.

WHICH WAS JUST DEVASTATING TO 

BUSINESSES, TO WORKERS, TO 

FAMILIES, TO HOUSEHOLDS ALL OVER

THE COUNTRY.

MANY OF US WHO ARE HERE OVER THE

NEXT TWO DAYS WERE IN GOVERNMENT

TOGETHER IN TWINE AND 2010, AND 

WE WERE FOCUSED NOT ONLY ON 

TRYING TO REPAIR THE ECONOMY, 

BUT ALSO ON THE URGENT 

OBLIGATION TO FIX THE FAILURES 

IN THE FINANCIAL SYSTEM THAT 

HELPED TRIGGER THE CRISIS IN THE

FIRST PLACE.

THE FAILURES THAT LED TO THAT 

CRISIS HAD MANY CAUSES.

REGULATORS.

HOUSEHOLDS TOOK ON RISKS THEY 

DIDN'T UNDERSTAND.

LEGAL LOOPHOLES AND REGULATORY 

GAPS ALLOWED LARGE PARTS OF THE 

FINANCIAL SECTOR AND MARKETS TO 

REALLY AVOID THE KIND OF 

OVERSIGHT AND TRANSPARENCY AND 

RESTRAINT THAT WAS NEEDED.

THERE WASN'T ENOUGH CAPITAL IN 

THE FINANCIAL SYSTEM TO PROTECT 

AGAINST LOSSES.

AND IN MANY WAYS, WE TRIED TO 

ADDRESS ALL THOSE CONCERNS TO 

THE BEST OF OUR ABILITY IN THE 

DODD-FRANK ACT.

AND I THINK IT DID PROVIDE IN 

MANY WAYS A STRONG FOUNDATION TO

BUILD A MORE STABLE AND 

RESILIENT FINANCIAL ESTIMATE.

ONE THAT PROTECTS CONSUMERS AND 

INVESTORS.

THAT IS ABLE TO ADAPT AND EVOLVE

WITH CHANGES IN THE FINANCIAL 

MARKET.

I THINK, HOWEVER, THAT THAT 

FOUNDATION IS AT EXTREME RISK 

TODAY.  AS MANY OF THE REFORMS 

PUT IN PLACE IN THE WAKE OF THE 

LAST FINANCIAL CRISIS ARE BEING 

ERODED AND NEW RISKS ARE 

EMERGING THAT ARE GOING 

UNADDRESSED.

SO WE'RE HERE TO REALLY TAKE 

STOCK OF WHAT HAS BEEN 

ACCOMPLISHED SO FAR.

WHAT WORK IS STILL LEFT TO DO.

WHAT PROGRESS IS BEING STYMIED.

WHAT REPAIRS WILL BE NEEDED IN 

THE FUTURE.

AND HOPEFULLY ALSO WHAT BOLD NEW

IDEAS WE SHOULD PURSUE IN A NEW 

LANDSCAPE.

FOR THE NEARLY 1 AND 7 AMERICANS

WHO LIVE IN POVERTY OR THE 

MILLIONS OF AMERICANS WHO FEAR 

FALLING OUT OF THE MIDDLE CLASS,

THESE FAMILIES WERE REALLY ILL 

PREPARED TO HANDLE THE SHOCK OF 

THE DEEP RECESSION.

THEY HAD LITTLE OR NO SAVINGS TO

FALL BACK ON AND STOOD ONE MAJOR

MEDICAL EMERGENCY FROM A 

PERSONAL ECONOMIC CRISIS.

THEY HAD NO FINANCIAL SLACK.

WHEN THE FINANCIAL CRISIS HIT IN

OVER LEVERAGED AND UNDER 

RESOURCES.

THE FEDERAL GOVERNMENT IN MANY 

WAYS HELPED CUSHION THAT IMPACT,

BUT THE HOUSEHOLD STILL FACED 

HUGE SETBACKS.

AND FOR MANY OF THESE FAMILIES, 

THEY HAVE NOT FULLY CRISIS TEN YEARS AGO.

WHAT THESE FAMILIES WERE AND ARE

NOW SEEKING IS SOME MEASURE OF, 

I THINK, FINANCIAL STABILITY.

GOING FORWARD, AMERICAN FAMILIES

WILL UNDOUBTEDLY NEED TO TRY TO 

SAVE A LARGER SHARE OF INCOME 

AND BORROW MORE RESPONSIBLY.

BUT HOUSEHOLD SHOULD NOT BE LEFT

ON THEIR OWN TO NAVIGATE A 

FINANCIAL SYSTEM THAT HAS BECOME

INCREASINGLY DETACHED FROM THEIR

EVERY DAY NEEDS.

ONE OF THE CRITICAL WAYS WE CAN 

HELP PROMOTE ECONOMIC SECURITY 

IS BY MAKING CONSUMER FINANCIAL 

MARKETS WORK BETTER FOR AMERICAN

FAMILIES.

LOW AND MODERATE INCOME 

INDIVIDUALS OFTEN LACK ACCESS TO

BASIC FINANCIAL SERVICES THAT 

COULD HELP THEM COPE BETTER WITH

A LACK OF FINANCIAL SLACK IN 

THEIR LIVES.

FACING SERIOUS ECONOMIC AND 

STRUCTURAL CONSTRAINTS, THESE 

HOUSEHOLDS TURN TO A VARIETY OF 

FORMAL AND INFORMAL INSTITUTIONS

TO MEET THEIR FINANCIAL SERVICES

NEEDS.

TO RECEIVE THEIR INCOME, TO PAY 

THEIR BILLS, TO BORROW AND TO 

SAVE.

BUT THE WAY OUR FINANCIAL SYSTEM

IS STRUCTURED OFTEN MAKES

TRANSACTING, SAVING AND 

BORROWING MORE EXPENSIVE AND 

LESS USEFUL FOR THE FAMILIES, 

THE FAMILIES WHO NEED IT THE 

MOST.

SO AT THIS CONFERENCE, WE'RE 

GOING TO BE TALKING A LOT ABOUT 

FINANCIAL ACCESS.

WE'LL ALSO BE SENDING A LOT OF 

TIME TALKING ABOUT THE CFPB.

THOSE OF YOU WHO ARE FAMILIAR 

WITH THAT LANDSCAPE KNOW THAT IN

THE LEADUP TO THE CRISIS, OUR 

FINANCIAL SYSTEM WAS LARGELY 

INCAPABLE OF SUPPORTING A 

SUCCESSFUL REGULATORY STRUCTURE 

FOR CONSUMER PROTECTION.

FRAGMENTATION OF RULE WRITING, 

SUPERVISION AND ENFORCEMENT MADE

IT IMPOSSIBLE TO CREATE A 

COMPREHENSIVE AND WELL 

CALIBRATED CONSUMER PROTECTION 

SYSTEM.

JURISDICTION AND AUTHORITY FOR 

CONSUMER PROTECTION WAS SPREAD 

OVER MANY FEDERAL REGULATORS.

ALL OF WHOM HAD HIGHER 

PRIORITIES THAN PROTECTING 

CONSUMERS.

BANKS COULD CHOOSE THE LEAST 

RESTRICTIVE SUPERVISOR AMONG 

MANY PROVIDERS.

MANY DIFFERENT BANKING AGENCIES.

AND A LARGE NUMBER OF NON-BANK 

PROVIDERS FROM HOME MORTGAGE 

ORIGINATORS TO PAYDAY LENDERS 

ESCAPED ANY MEANINGFUL 

SUPERVISION COMPLETELY.

WITH THE CREATION OF THE 

CONSUMER FINANCIAL PROTECTION 

BUREAU, WE HAD A CHANCE AND 

STILL HAVE A CHANCE TO DO MORE 

THAN PLAY CATCH UP IN REGULATING

CONSUMER FINANCIAL MARKETS.

THE BUREAU PROVIDED A HISTORIC 

OPPORTUNITY TO BUILD A 

SUCCESSFUL REGULATORY STRUCTURE 

FOR CONSUMER PROTECTION.

ONE THAT IS DESIGNED TO PROMOTE 

FINANCIAL INCLUSION, PRESERVE 

CONSUMER CHOICE, PROVIDE FOR 

MORE EFFICIENT AND INNOVATIVE 

MARKETS FOR CONSUMER FINANCIAL 

MARKETS.

AND A CONSUMER FINANCIAL 

PROTECTION BUREAU PROVIDED FOR 

THE FIRST TIME A CONSUMER AGENCY

WITH THE NECESSARY MISSION 

FOCUS, MARKET-WIDE COVERAGE AND 

CONSOLIDATED AUTHORITY.

AS WE'LL HEAR FROM MANY OF OUR 

SPEAKERS UNDER ELIZABETH WARREN,

UNDER RICH CORDRAY, UNDER MANY 

SPEAKERS TODAY, THEY GOT A LOT 

DONE.

PREPAID LENDING, CREDIT CARDS, 

A

ARBITRATION AND THE LIKE AND 

TOUGH ENFORCEMENT THAT BROUGHT 

IN FEES AND RESTITUTION.

BUT TODAY MUCH OF THAT WORK IS 

AT RISK.

REFORMS IN SOME RESPECTS HAVE 

BEEN WEAKENED.

AND THERE'S A REAL CONCERN ABOUT

THE DIRECTION OF THE AGENCY 

TODAY.

WE'LL HAVE SEVERAL PANELS 

FOCUSED ON THE CFPB'S PAST AND 

FUTURE, AS WELL AS ON THE KEY 

CONSUMER FINANCE MARKETS AND HOW

TO MAKE PROGRESS.

WE'RE ALSO GOING TO BE TALKING 

ABOUT INVESTOR PROTECTION.

THERE ARE A HOST OF ISSUES HERE 

FROM REFORMS IN THE MORTGAGE 

MARKETS TO CLEANING UP 

DERIVATIVE RULES, BUT WE THOUGHT

WE WOULD FOCUS TODAY AND 

TOMORROW ON ONE PARTICULAR LONG 

STANDING PROBLEM.

ADVICE PROVIDED TO INVESTORS BY 

THEIR BROKERS.

WE'LL ALSO BE HEARING A LOT 

ABOUT STUDENT LOANS AND ISSUES 

WHICH ARE REALLY ISSUES NEAR AND

DEAR TO MANY OF OUR STUDENTS AND

MANY OTHERS IN THE AUDIENCE.

WHAT PROTECTIONS HAVE WORKED?

WHAT CRISIS LIE AHEAD?

AND WHAT CAN WE DO TO REDUCE THE

RISK OF THEM GOING FORWARD?

THE FINANCIAL CRISIS LED TO 

FUNDAMENTAL REFORMS OF OUR 

FINANCIAL SYSTEM, BUT THE 

PROCESS OF REFORM IS NOT OVER.

AMERICAN FAMILIES CAN ILL AFFORD

A FINANCIAL SYSTEM THAT IMPOSES 

UNNECESSARY COSTS, CONFUSION AND

COMPLICATIONS ON THEIR DAILY 

LIVES.

OUR COUNTRY MUST TAKE THE STEPS 

NECESSARY TO ENSURE THAT THE 

FINANCIAL SYSTEM WORKS BETTER 

FOR EVERYONE.

AND THIS CONFERENCE WILL HELP US

MOVE THESE ISSUES FORWARD.

I'M THRILLED TO WELCOME SO MANY 

DISTINGUISHED SPEAKERS FROM A 

WIDE VARIETY OF BACKGROUNDS, 

INCLUDING MANY OLD FRIENDS.

WE HAVE AN OUTSTANDING GROUP OF 

SPEAKER AND PANELISTS JOINING US

OVER THE NEXT FEW DAYS, MARKET 

MAKERS, POLICY MAKERS, RULE 

ENFORCERS, WHAT JOHN LEWIS WOULD

CALL PEOPLE WHO MAKE GOOD 

TROUBLE.

AND I'M ALSO ESPECIALLY 

DELIGHTED TO THANK OUR KEY NOTE 

SPEAKERS, FOUNDING CFPB DIRECTOR

RICH CORDRAY WHO WE'LL HEAR FROM

OVER LUNCH.

OUR SPEAKERS WILL TAKE UP A WIDE

VARIETY OF ISSUES OVER THE NEXT 

TWO DAYS.

I'M REALLY HAPPY TO WELCOME YOU 

HERE.

BUT BEFORE WE GET UNDER WAY, I 

WANT TO TALK A LITTLE BIT ABOUT 

SOME LOGISTICS FOR THE NEXT 

COUPLE OF DAYS.

WE'RE GOING TO STAY IN THIS ROOM

FOR THE KEY NOTE AND PANEL 

DISCUSSIONS WITH COFFEE AND 

SNACK BREAKS OUT IN THE GREAT 

HALL OUTSIDE THESE DOORS.

AT THE END OF EACH KEY NOTE OUR 

PANEL CONVERSATION, WE'RE GOING 

TO OPEN THE FLOOR TO QUESTIONS.

WE'RE VIDEO RECORDING TODAY'S 

CONFERENCE AND WE'LL BE LIVE 

STREAMING IT AS WELL.

WELCOME TO THOSE OF YOU WHO ARE 

WATCHING ONLINE.

LET ME JUST SAY FOR THOSE OF YOU

WHO ARE HERE BUT HAVEN'T 

REGISTERED, IF YOU WOULDN'T MIND

IN THE COFFEE BREAK GOING OUT 

AND REGISTERING SO THAT WE CAN 

KEEP IN TOUCH WITH YOU AND YOU 

CAN GET ACCESS TO THE MATERIALS 

THAT COME OUT OF THE NEXT COUPLE

OF DAYS OF DISCUSSION.

OUR KEYNOTE SPEAKER RICH 

CORDRAY IS GOING TO SPEAK AT 

LUNCH, AS I MENTIONED.

WHEN LUNCH TIME COMES, WE'RE 

GOING TO ASK YOU TO MOVE OUT TO 

THE GREAT HALL PRETTY QUICKLY.

BRING YOUR LUNCH BACK IN PRETTY 

QUICKLY AND SIT HERE AND EAT IN 

THE AUDITORIUM SO WE CAN HAVE 

THE FULL AMOUNT OF TIME WITH 

RICH.

THOSE OF YOU WHO ARE SITTING IN 

THE BACK ROWS, YOU'LL SEE LITTLE

TABLETOPS YOU CAN PULL UP.

SO YOU DON'T NEED TO EAT ON YOUR

LAP.

THOSE OF YOU IN THE FRONT, YOU 

CAN CERTAINLY MOVE TO THE FRONT 

IF YOU'RE SITTING IN THE BACK, 

AS I ALWAYS TELL MY STUDENTS.

BUT PLEASE GET ORGANIZED QUICKLY

OVER LUNCH.

RESTROOMS ARE OUT THE DOOR TO 

THE RIGHT AND AROUND THE CORNER 

NEAR THE ELEVATORS.

THOSE SHOULD BE EASY TO FIND.

LASTLY, I HAVE QUITE A NUMBER OF

THANK YOUS TO GIVE BECAUSE AN 

EVENT LIKE THIS TAKES QUITE A 

NUMBER OF PEOPLE TO PULL OFF.

LET ME START BY THANKING ALL OF 

THE SPEAKERS.

ALL OF YOU WHO ARE SHARING YOUR 

TIME AND EXPERTISE WITH US 

TODAY.

THE CENTER ON FINANCE LAW AND 

POLICY IS WORKING WITH THE FORD 

SCHOOL OF PUBLIC POLICY ON THIS 

EVENT.

SO I'M THANKFUL TO MYSELF FOR 

CO-SPONSORING THE EVENT.

 [ LAUGHING ] 

>>  I WANT TO THANK A NUMBER OF 

OUR STUDENT GROUPS WHO ARE 

WORKING WITH US.

AFFORDABLE MICHIGAN, THE 

BANKRUPTCY LAW SOCIETY.

THE BUSINESS LAW ASSOCIATION, 

THE CONSUMER ADVOCACY AND 

FINANCIAL REGULATION AND 

MICHIGAN FINNTECH.

YOU'LL SEE MANY STUDENTS OVER 

THE NEXT COUPLE OF DAYS.

LET ME THANK IN PARTICULAR THE 

CENTER ON FINANCIAL AND POLICY 

STAFF KRISTI BEAR WHO YOU'VE 

BEEN CORRESPONDING WITH AND 

TRACY VANDEUCEN WHO YOU'VE BEEN 

CONNECTING WITH AS WELL.

THEY DO EXTRAORDINARY WORK TO 

MAYOR THIS EVENT HAPPEN.

I ALSO WANT TO THANK FORD SCHOOL

STAFF WHO ARE WORKING WITH US IN

ADDITION TO THEIR DAY JOBS 

HELPING OUT WITH THIS 

CONFERENCE.

TOM COOK, BILL KELLY, ERIK, 

BONNIE ROBERTS.

I ALSO WANT TO THANK THE FORD 

SCHOOL COMMUNICATIONS TEAM LORA 

LEE, CHRIS MEYERS, BECKY MULLEN 

AND NICK FOST.

WE ALSO WOULD LIKE TO THANK 

FINANCIAL SUPPORTERS OF THE CFLP

IN THIS CONFERENCE.

UNIVERSITY OF MICHIGAN ALUMNI 

PAUL LEE, JOHN LOOMIS AND BILL 

MARCOO.

LET ME THANK ALL OF THE RESEARCH

ASSISTANTS WHO WORKED ON THIS 

CONFERENCE.

FINALLY, THANKS TO ALL OF YOU 

FOR BEING HERE TODAY.

I'M LOOKING FORWARD TO THE 

CONVERSATIONS TO COME.

AND WITH THAT, I'VE WAITED LONG 

IF YOU 

ENOUGH FOR LISA TO ARRIVE AND WE

CAN START THE FIRST PANEL.

I CAN STRETCH OUT.

ONE OF THE GREAT THINGS YOU 

LEARN AS A FACULTY MEMBER IS YOU

CAN SHORTEN OR STRETCH OUT YOUR 

REMARKS FOR ANY LENGTH NEEDED 

FOR THE OCCASION.

SO I'M REALLY DELIGHTED TO 

WELCOME OUR FIRST PANEL THIS 

MORNING.

AND I'M GOING TO TURN THINGS 

OVER TO ERIK TO GET US STARTED.