Note: If you find my posts too long or too dense to read on occasion, please just read the bolded portions. They present the key points I’m making and the most important information I’m sharing.
My previous post made the case for strong regulation of the financial industry to protect consumers with a strong Consumer Financial Protection Bureau (CFPB). The financial industry needs strong regulation because it has repeatedly shown that without regulation it will rip off consumers and engage in practices that put our economy and our whole financial system at-risk.
In addition to the Trump administration’s weakening of the CFPB and other regulation of the financial industry, pro-business judicial decisions have also weakened consumer protections from abusive financial industry practices. However, Congress can restore these consumer protections through appropriate legislation.
First, the Supreme Court ruled that the Federal Trade Commission (FTC) cannot seek monetary compensation for consumers defrauded by payday or other short-term lenders. The Consumer Protection and Recovery Act has been introduced in Congress and would make it clear that the FTC can seek financial compensation for these consumers. 
Second, the Comprehensive Debt Collection Improvement Act would strengthen a variety of protections for borrowers that were weakened by judicial decisions. For example, it would limit email and other electronic harassment by debt collectors and restrict abusive practices by medical debt collectors.
Finally, the Non-judicial Foreclosure Debt Collection Clarification Act would regulate any business involved in home foreclosures without a judge’s authorization as a debt collector under the Fair Debt Collection Practices Act. In 30 states and D.C., lenders can foreclose and repossess a home without going to court and getting a judge’s ruling. A Supreme Court ruling limited home owners’ rights in these states. This legislation would give these home owners the protections of the Fair Debt Collection Practices Act.
The Securities and Exchange Commission (SEC) is an independent federal regulatory agency responsible for protecting investors and maintaining the fair and orderly functioning of securities markets. It works to ensure full public disclosure of information so all investors are on an equal footing. To that end, it works to prevent, identify, and punish insider trading, where some people have information that is not available to the general public and therefore have an unfair advantage in making decisions about buying and selling securities. 
Classic insider trading was in the news a year ago. Some members of Congress, who had received private, closed-door briefings on the coronavirus, made substantial stock market trades that appeared to be informed by this non-public information. Similarly, some executives of firms working on coronavirus vaccines, who had knowledge of the progress of their vaccine development that was not public, made substantial stock market trades that appeared to be informed by this non-public information. There were also situations where an insider shared non-public information with an outsider who then appears to have made investment transactions based on this non-public information.
However, there is another type of insider trading that may be more insidious – using sophisticated computers to make large trades moments before other trades that are in the pipeline are executed and become public knowledge. This is referred to as “front-running” and is a systemic problem in securities markets. It allows those with these sophisticated computer systems to make profits at the expense of everyone else who’s buying and selling securities.
Although the SEC has the power to address these problems under existing laws, it has failed to stop these practices which unfairly disadvantage run-of-the-mill buyers and sellers of securities.
The SEC is also charged with preventing large-scale speculation, particularly with borrowed money, that puts banks and financial corporations at-risk of bankruptcy if a large speculative investment goes bad. This is exactly what caused the 2008 financial collapse. This type of systemic risk is substantial today in large part because the financial industry has created “investments” that are called derivatives – financial instruments that are derived from or based on other financial instruments. In 2008, for example, the core problem was derivatives based on home mortgages. These were packages of home mortgages, and portions of them (e.g., the interest and principal portions of payments), and speculation on how interest rates would change, etc. These and many other derivatives are hard for most investors to understand, can be very volatile, are hard to put a value on, are hard to regulate, and it’s almost impossible to predict how they will perform as an investment. Therefore, investing in them is basically gambling and the securities market for them is basically a casino.
The laws and regulations that were put in place after the 2008 collapse to prevent a recurrence have been watered down or unenforced to the point that many experts believe we are likely to see a repeat of that collapse, and possibly a worse one. The largest 40 banks across the world are larger than ever and so interconnected through derivative “investments,” loans, and other financial transactions, that governments would have no choice but to bail them out again to prevent a total collapse of the financial system if any piece of this complex, opaque, and highly speculative financial casino were to crash in value.
I urge you to contact your U.S. Representative and Senators and to ask them to support strong, effective regulation of the financial industry through federal agencies such as the Federal Trade Commission and the Securities and Exchange Commission. Consumers and our financial markets need to be protected from the no-holds-barred greed and hubris of those in the financial industry. The consistent, aggressive, and risky practices across the financial industry, including by its largest corporations, require no less. You can find contact information for your U.S. Representative at http://www.house.gov/representatives/find/ and for your U.S. Senators at http://www.senate.gov/general/contact_information/senators_cfm.cfm.
Please also contact President Biden and ask him to appoint individuals who will implement strong regulation of the financial industry at the Federal Trade Commission, the Securities and Exchange Commission, and other federal agencies. This is important because Biden has not always supported strong regulation of corporations and the financial industry. He is from Delaware, which is the legal home of many U.S. corporations because of its lax regulation of corporations. You can email President Biden via http://www.whitehouse.gov/contact/submit-questions-and-comments or you can call the White House comment line at 202-456-1111 or the switchboard at 202-456-1414.
 Cohen, R. M., 4/27/21, “Congress looks to judicial overrides to strength consumer protections,” The Intercept and The American Prospect (https://theintercept.com/2021/04/27/supreme-court-ftc-consumer-debt/)
 Turner, L., & Kuttner, R., 2/18/21, “The financial reforms we need,” The American Prospect (https://prospect.org/economy/financial-reforms-we-need-lynn-turner-interview/)