Washington, D.C. – U.S. Rep. Allyson Schwartz praised passage today of legislation to provide stronger consumer protections for American families and prevent the type of abuses that led to the current economic crisis. The Wall Street Reform and Consumer Protection Act of 2009 includes common sense reforms to protect consumers from predatory lending abuses and misleading tactics, and ensures strong supervision and regulation of the business practices of our financial institutions.

“Over the past year, this Congress and President Obama made tough choices and enacted vital measures to bring our economy back from the brink of disaster,” Schwartz said. “Now it is time to take action to ensure such a financial crisis doesn’t happen again. Wall Street reform is the next critical step to creating jobs and growing our economy. American families have paid too high a price already for some financial institutions’ risky behavior. This action will provide transparency, oversight and accountability essential to protecting consumers.”

The Wall Street Reform and Consumer Protection Act will put an end to taxpayer-funded bailouts; protect families’ retirement funds, college savings, homes and business’s financial futures; and bring transparency and accountability to our financial system.

The legislation:

• Creates a Consumer Financial Protection Agency to ensure that bank loans, mortgages and credit cards are fair, affordable, understandable and transparent. The CFPA will prevent the financial industry from offering predatory mortgage loans to people who can’t afford them and put in place common sense regulations to stop abuses by the financial industry, such as payday lending and exorbitant overdraft fees.
• Ends too big to fail financial firms by providing the government with the tools—funded by the banks and financial firms, not taxpayers—it needs to manage financial crises so we are not forced to choose between bailouts and financial collapse.
• Ensures American taxpayers are never again on the hook for bailing companies out by requiring big banks and other financial institutions to foot the bill for any future bailouts.
• Requires that all financial firms that pose risk to the system are subject to strong supervision and regulation.
• Stops predatory lending and irresponsible mortgage loan practices, helping ensure the mortgage industry follows basic rules of sound lending and consumer protection.
• Requires more transparency and tougher regulations of hedge funds, private equity firms and credit rating agencies.

Schwartz supported the inclusion of two particular provisions in the legislation that will help Southeastern Pennsylvania’s life science and biotech industries. These industries are directly responsible for more than 77,000 jobs throughout Pennsylvania. Specifically, Schwartz worked with the House Financial Services Committee to ensure that venture capital firms, which are major sources of funding for life sciences and biotech firms, will comply with reporting requirements that are appropriate to the nature of their business and level of risk.  

She also voted against an amendment that would have eliminated a provision to provide small innovative companies with less burdensome audit requirements, while maintaining those requirements for companies with more than $75 million in market capitalization.

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