Washington Post has an article today on President Obama scolding business groups that have fought his plan to create a new federal agency (Consumer Financial Protection Agency) to oversee mortgages, credit cards and other consumer financial products, casting the debate as a battle between his administration and Wall Street.

According to the newspaper, the proposed agency has become the most divisive, partisan element of the administration’s wide-ranging plan to overhaul the nation’s financial regulatory system. Republicans on congressional committees considering regulatory reform have almost uniformly opposed it. Banks and other financial firms, along with armies of lobbyists, have flooded Capitol Hill carrying the message that the new agency would add an unnecessary layer of government regulation, increase costs, stifle financial innovation and ultimately curtail choices for consumers. Obama disputed that the new agency would restrict consumer choice or limit meaningful innovation. “Nothing could be further from the truth,” he said, arguing that “in a financial system that’s never been more complicated, it has never been more important to have a watchdog function like the one we’ve proposed.” The House Financial Services Committee plans to edit and vote on the legislation beginning as early as next week.

On the other side of the Atlantic, there are different agencies for consumers of financial products, although they seem to be closer to ombudsmen and, consequently, probably less powerful than the contemplated U.S. agency might prove to be. In the European Union, the European Commission launched in 2001 the Financial Dispute Resolution Network (FIN-NET). FIN-NET is a financial dispute resolution network of national out-of-court complaint schemes in the European Economic Area countries (the European Union Member States plus Iceland, Liechtenstein and Norway) that are responsible for handling disputes between consumers and financial services providers, i.e. banks, insurance companies, investment firms and others. Currently FIN-NET has 46 members from 21 European Economic Area countries. More information about the members can be found here. It would be interesting to hear more about individual country cases. Are agencies entrusted with overseeing financial services in other places part of the respective ministries or independent public bodies? What is the scope of their powers? Do they resemble Ombudsmen or do they also possess regulatory authority?