Elizabeth Warren says deceptive lending practices by large banks had another important victim besides consumers: Smaller community banks that couldn't compete with big banks that advertised one price but charged another.
Warren, an outspoken advocate for the financially stressed middle class, has long targeted the impact of bankers' "tricks and traps" that caused consumers to suffer as a 6 percent interest rate on a credit card or mortgage mushroomed to two, three, or five times that rate. But as she works to establish the new Consumer Financial Protection Bureau, she's identified a potential ally in the nation's small banks, which she says found themselves unable to compete with the mega-banks' needlessly complex and deceptive business models. In an op-ed for Politico, she writes:
The bankers I have talked with are not looking to Washington to solve their problems. But they are looking for a market that allows them to compete. They are looking for a regulatory structure that doesn’t require an army of lawyers, and a level playing field that lets customers see the true cost of a product -- so lenders do not need to compete against a phantom price.
Warren writes that she has been meeting regularly with community bankers, starting with some in her native Oklahoma, and has gained an increasing appreciation of their perspective: