U.S. Rep. Frank to scrutinize housing and credit cards
U.S. Rep. Barney Frank (D-MA) holds a House Financial Services Committee hearing to address why a crisis originating from risky loans to less creditworthy buyers happened, on Capitol Hill in Washington, September 5, 2007. Frank will this year scrutinize the mortgage lending industry and draft new consumer protections for credit card holders, he said on Friday.
Credit: Reuters/Jonathan Ernst
WASHINGTON (Reuters) - The chairman of the U.S. House of Representatives Financial Services Committee will this year scrutinize the mortgage lending industry and draft new consumer protections for credit card holders, he said on Friday.
Barney Frank, a Massachusetts Democrat, also said he will fiercely defend his plan to create a government-funded program that would boost the country's supply of housing for low-income families.
"I think the lack of affordable housing is now clear to everyone as a contributing factor to the subprime crisis," Frank said in an interview with Reuters. "If people want to make that a fight, I think we win."
This summer, Frank shepherded legislation through the House that would reform the Federal Housing Administration.
The White House supports broad FHA reform, but has threatened to sink Frank's bill unless he drops provisions that would also create a affordable housing trust fund. Frank wants that fund to be financed by a new surcharge on some FHA loans.
While a Senate version of FHA reform did not include the trust fund, Frank said he will fight for it when lawmakers from both chambers soon meet to hammer out a compromise.
When asked by a reporter how he would try and preserve the fund, Frank bristled: "Why would I negotiate in public? You are asking me to tell people what my negotiating position is. That would be extraordinarily stupid," he said.
In other remarks, Frank outlined his agenda for the his committee and promised to take a fresh look at the ongoing mortgage crisis even though the House of Representatives has passed a bill with new protections for prospective homeowners.
"The widespread 'originate to distribute loans' model, as (Federal Reserve Board Chairman Ben) Bernanke calls it -- we have to look very seriously into that," he said.
In the past, Frank has questioned the role Wall Street played in sponging up home loans that were flawed or improperly underwritten.
Frank also said he will also take on credit card reform.
"We'll do a credit card ... a consumer protection credit card bill, that's true," he said.
(Reporting by John Poirier and Patrick Rucker; editing by Gary Crosse)
