January 3, 2014 / 4:56 PM / 4 years ago

U.S. Fed says consumer division director to retire in April

WASHINGTON, Jan 3 (Reuters) - Sandra Braunstein, the Federal Reserve’s director of the consumer and community affairs division, will retire in April, the U.S. central bank said on Friday.

Braunstein will leave the division that is in charge of writing consumer protection rules. She also has served as the Fed’s liaison to community groups and consumer advocates.

Braunstein was hired by the Fed in 1987 and has led the consumer division since 2004, the Fed said in a statement. During the later years of her tenure, she helped shift consumer protection activities from the Fed to the new Consumer Financial Protection Bureau created by the 2010 Dodd-Frank law.

“She has demonstrated strong leadership in the development and implementation of policies and practices to promote community development, safeguard consumers, and ensure that financial institutions comply with federal consumer protection laws,” outgoing Fed Chairman Ben Bernanke said in a statement.

The Fed came under intense criticism from Congress after the 2007-2009 financial crisis for lax oversight of the biggest U.S. banks. Critics said the agency failed to protect consumers from financial institutions’ bad behavior.

As a result, Congress established a separate bureau focused solely on protecting Americans from financial scams.

Braunstein was called before Congress to offer guidance on mortgage rules during the financial crisis, and the central bank took a series of steps to provide help to consumers under her watch, the Fed said.

She helped develop a new regulatory framework for credit cards, the Fed said. In 2008, the Fed established new regulatory protections for consumers in the residential mortgage market. Braunstein also oversaw the creation of mortgage foreclosure mitigation and neighborhood stabilization programs.

The Fed statement did not say what Braunstein planned to do after leaving the agency. The agency has hired an outside recruiting firm to consider candidates to replace her.

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