21 July 2011
The Consumer Financial Protection Bureau (CFPB) officially opens its doors today. Created by the sweeping Dodd-Frank Wall Street Reform Act last July, the Bureau will serve as the leading federal regulator against deceptive, abusive and predatory loan products in the financial marketplace. One important arm established at the CFPB is the Office of Servicemember Affairs (OSA), which is dedicated solely to helping America's military servicemembers and their families.
U.S. service members and their families sacrifice a lot to defend our nation; yet, they often fall victim to unfair or deceptive financial practices. Unfortunately, many unscrupulous lenders look to take advantage of military families because of their unique demographic characteristics. Young soldiers who are receiving steady paychecks for the first time are often surrounded by aggressive sellers and lenders outside the military base. Military families face many challenges due to deployments and frequent moves in these difficult economic times. During the lead up to the enactment of the Dodd-Frank Act, top military officials recognized there was a need in protecting military families from unfair financial practices. In a letter to the U.S. Treasury Department, Undersecretary of Defense Clifford L. Stanley states that the “personal financial readiness of our troops and families equates to mission readiness.”
The Office of Service Member Affairs takes aims to deny predators who take financial advantage of those who serve. Headed by Holly Petraeus, the OSA is designed to strengthen financial protection for service members and their families as well as promote financial education. OSA officials will also assist the CFPB enforcement team, and coordinate efforts with federal and state agencies, when they find bad actors breaking consumer financial protection laws to harm service members.
The creation of the OSA could be a significant step toward curbing unfair or deceptive financial practices against service members. More widespread financial literacy and awareness can also help military families better handle the financial challenges that can come with serving our nation.
Ellen M. Taverna
Legislative Associate, National Association of Consumer Advocates (NACA)