Sens. Chris Dodd, D-Conn., and Bob Corker, R-Tenn., are reportedly nearing a compromise in financial-reform negotiations that would place consumer protection responsibilities with the Federal Reserve.
According to numerous reports, Dodd is warming to a Corker-proposed plan that would allow the president to appoint the consumer protection division chief. The division would maintain an independent budget and write rules pertaining to financial products, but enforcement of the rules would be handled by existing regulators.
In December, the House passed its version of financial reform legislation, which included a Consumer Financial Protection Agency.
In past weeks, Dodd, chairman of the Senate Banking Committee, floated a proposal that would give the Treasury Department power to regulate financial products. Corker opposed that idea, a Democratic Senate aide told BusinessWeek.
According to a report in the Washington Post, a Treasury spokesperson said Monday that the Obama administration's focus on consumer protection includes "ensuring the bill includes independent appointment, an independent budget, and an independent ability to set and enforce clear rules of the road."
SOURCES: BusinessWeek, Washington Post