OCC: Disclosures Have Too Much Information
In a recent speech, Acting Comptroller of the Currency Julie Williams said, "Disclosures are the heart of the consumer protection system, but the system is on the verge of breaking down and fundamental changes are needed. The current approach does not serve consumers well, and imposes unnecessary burdens on bankers. Currently, consumers get too much information, not too little. And the information overload means consumers who see just a haze of fine print, instead of the information they want and need, may understandably conclude that certain information is deliberately being obscured."
Williams went on to challenge Congress, consumer advocates, regulators and bankers to take a fresh approach to the way information is provided to consumers. She suggested that "...drafting consumer disclosures is a task that must not be left to the lawyers, because, no matter how talented, they are not likely to come up with disclosures understandable to most people."
At the same time, she warned that bankers must accept the fact that abbreviated, understandable disclosures, which will do much to alleviate regulatory burden, will provide information that may result in consumer choices that some banks might not like - such as opting out from information sharing.
She compared banking disclosures to nutrition labels on food packages, and noted those labels took years to develop, so we may expect that change in financial disclosures "...will not happen overnight."
Copyright © 2005 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 14, No. 11, 1/05
First published on 01/01/2005