Do Safety and Soundness and Consumer Protection Really Conflict?
WASHINGTON — A key banking industry argument against the creation of a consumer protection agency — that the new division would write rules that conflict with safety and soundness standards — is shaky. Current and former regulators, industry observers and academics said in interviews that such conflicts have rarely arisen in the past; few expected major problems in the future even if consumer issues are handled by a separate agency. “In 14 years, 10 at the OCC, I cannot recall a meeting I sat in where we worried about consumer protection and looked at safety and soundness and said the two are in conflict so how do we solve this,” said Kevin Jacques, the Boynton D. Murch chairman in finance at Baldwin-Wallace College and a former Treasury official. “I don’t buy the reasoning at all. I would love to see one regulator provide a concrete example where safety and soundness and consumer protection are in conflict and it caused some difficulty. I can’t think of one.” Brad Sabel, a partner at
