Unless the Federal Reserve Board defines unfair and deceptive practices by the fall, House Financial Services Committee Chairman Barney Frank said Tuesday he would give that power to other regulators.
"What we're going to do is, I think, give the Fed the ultimatum. If they haven't begun to spell out the rules under their authority, then we will take it away from them," the Massachusetts Democrat told reporters after speaking to a conference of the National Alliance to End Homelessness.
He had issued similar warnings to Fed Gov. Randall Kroszner during a hearing last month. Rep. Frank says he is frustrated the central bank has not used its authority under the Federal Trade Commission Act to define unfair and deceptive practices. Fed officials have told lawmakers that they are concerned about consumer protection but hesitant to issue rules that might create legal or practical challenges.
That response has done little to mollify Rep. Frank, who said he is considering handing the power to the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency.
"I would say if this drags on, I'll think about talking to other members about … taking it away from the Fed and give it to [FDIC Chairman Sheila] Bair and [Comptroller John] Dugan," he said.
Rep. Frank used his speech to stump for legislation he introduced last month that would create an affordable housing trust fund. He told the audience he would continue to push for the bill's passage, despite opposition from Republican lawmakers and the White House.
