Officials Seek Input on New Consumer Protection Office
By Army Sgt. 1st Class Michael J. Carden
American Forces Press Service
JOINT BASE MYER-HENDERSON HALL, Va., Apr. 13, 2011 Treasury Department officials met here today with service members and their families to better understand financial challenges in the military community.
Holly Petraeus, head of the Office of Servicemember Affairs in the Treasury Department’s Consumer Financial Protection Bureau, has been traveling to military posts throughout the country and leading dialogues with troops and their families since January.
Petraeus and Elizabeth Warren, the treasury secretary’s special advisor for the Consumer Financial Protection Bureau, are gathering feedback they hope will help them when the new offices officially stand up July 21.
“A significant part of what we’re here to do is be a voice for military families and better understand the financial issues facing military personnel,” Warren said to an audience of about 70 troops and spouses. She added that she and Petraeus want “to make sure that military families have adequate access to financial education, and that there are adequate rules to protect military families.”
For the first time, Warren explained, the Consumer Financial Protection Bureau will have jurisdiction over lenders outside the traditional banking system, such as mortgage brokers, title loaners and check cashers, all of which have preyed on military communities, she said.
The bureau can enforce better practices and financial laws on those groups that they previously could not, she added, citing the importance of military families’ input when dealing with such vendors.
“We want to ensure that your perspective is in the DNA of this agency right from the beginning,” Warren said. “If we do this right, we have an opportunity with this agency to make some real changes.”
Petraeus echoed Warren’s sentiments, expressing happiness at being asked to head an office dedicated to addressing financial concerns of service members, as well as hearing and responding to their complaints. Her office, she said, will ensure military families have the financial education they need to make good financial decisions.
“I pledge to do everything that I can to be sure that my office serves you,” she told the group today.
Petraeus has been a military spouse for 36 years. Her husband, Army Gen. David H. Petraeus, commands U.S. and NATO forces in Afghanistan. She understands the kinds of financial challenges military families deal with, she said.
“It may be hard to believe now, but my husband and I were once a young Army couple who didn’t make a whole lot of money,” she said. “And we weren’t that smart about what we did with it. We made some of the rookie financial mistakes I try to warn people about today.”
For example, she said, they had to have the hot sports car, and they bought furniture at rent-to-own stores. They also once signed an apartment rental contract without physically checking out the place, because the picture in the brochure looked nice, she added.
“I think the lack of credit cards and easy loans in those days protected us from getting into too much trouble,” Petraeus said. “Unfortunately, that’s not the case for military families today.”
People seeking a loan, a credit card or even debt relief today will find many expensive or outright fraudulent deals waiting for them, especially on the Internet, she added.
Because servicemembers have a guaranteed paycheck each month, troops and their families are attractive targets for scammers, Petraeus said, and the military’s culture ensures troops pay their debts.
“That makes you a population at risk”, she said.
Properly managing finances may be difficult for younger service members and deployed troops, Petraeus said. Because predatory lenders see them as means for potential profit, she added, her office will help troops know how to spot red flags and will respond should they become targets of predatory lending.
“It’s because of these special risks and the unique sacrifices you make for your country that Congress created my office,” she said. “The conversation we have with you today and with other families in the coming months will help us decide how the Office of Servicemember Affairs should operate and what needs immediate attention.”