Consumer Financial Protection Agency to cut mis-selling

The US proposed regulation of financial service has been set out in an 88-page document, setting up a new regulator called the Consumer Financial Protection Agency to look after personal financial services, the Times reports.

It will prevent a repeat of the sales of sub-prime mortgages that led to last year's financial crisis.

Other details include:

  • A beefed-up Federal Reserve will oversee businesses considered 'too big to fail'
  • A Financial Services Oversight Council made up of representatives from the various regulators
  • US Treasury will have the power to seize control of failing companies and undertake an orderly wind-down
  • The Office of Thrift Supervision, which regulates small deposit-taking institutions, will close.