Rep. Melissa Bean (IL-08) via Wikimedia

Rep. Melissa Bean (IL-08) via Wikimedia

Melissa Bean must want to be the Mike Ross of financial reform. The Blue Dog Bean is seeking to amend the reform bill establishing the Consumer Financial Protection Agency to pre-empt state laws protecting mortgage buyers if they are stronger than federal laws. I’ve noted before that the Blue Dogs don’t care a rip about consumers, but really worry about their corporate sponsors.

Pre-emption is a major goal of the big banks, which mouth an invented argument that it is more efficient for them if they can offer the same deals everywhere, without having to pay attention to the detailed requirements of different states. Bean has taken a whole lot of money from giant financial institutions, and has been carrying their water on other issues.

You really have to wonder about these giant banks. Right now, their mortgage subsidiaries have to figure out state and local laws on all sorts of issues in residential lending, from where and when to record their mortgages to zoning laws. How hard is it to comply with consumer protection laws in each state? Community and regional banks do it, and so do the local credit unions and other local lenders. The whiny giants are just looking for another way to get out from under the laws of states that want to provide real protection for their citizens, arguing that their size entitles them to all kinds of extra goodies at the expense of their customers. No one really thinks that they would pass any savings along to customers, now do they?

If I were a legislator in one of the states that got pre-empted, I’d just re-write my civil consumer protection legislation and make it a criminal offense with strict liability, a misdemeanor, and make the mortgage broker and each supervisor criminally liable. The punishment for misdemeanors isn’t that great, but a few months in the county jail, living on fried baloney and white beans, is probably enough. One thing is for sure, white collar folks can be deterred, as long as the punishment is swift and sure.

If you’re in IL-08, or even if you’re not, give her office a ring. Ask for the legislative assistant on the House Financial Services Committee. Explain that you read that she wants to minimize consumer protection in the financial services industry. Do not pay any attention to the bizarre explanation, it will only confuse matters if you try to argue. Tell the aide you are writing a diary for a blog, and ask for a list of consumer protection issues where she is on the side of the consumer, and for a list of her campaign contributions from banks and mortgage lenders. Write up your response for The Seminal. We’ll all be interested to see the results.

Or just call and tell her you want the fullest possible protection when you make the largest purchase of your life.

1701 E. Woodfield Road
Suite 200
Schaumburg, IL 60173
Phone: 847-517-2927
Fax: 847-517-2931
Hours: 9:00 a.m. – 5:00 p.m. Central Time

432 Cannon House Office Building
Washington, DC 20515
Phone: 202-225-3711
Fax: 202-225-7830
Hours: 9:00 a.m. – 5:00 p.m. Central Time
Monday through Friday