Fed will oppose loss of consumer loan authority

President Barack Obama's proposal for a new Consumer Financial Protection Agency met with fast disapproval from Federal Reserve officials, who don't want to lose control of writing the rules on lending and disclosure practices on mortgages and credit cards. But their opposition won't find many supporters in the U.S. Congress, which believes the Fed's response to the recent mortgage crisis was too little too late.

The new Consumer Financial Protection Agency (CFPA) will be the watchdog for consumers and supplant the Fed's authority to set rules for mortgages and credit cards. "We've got to make sure that we have somebody who is focused and responsible for protecting consumers, whether it's on subprime loans, for their mortgages, for their credit cards," Obama told Bloomberg.