WASHINGTON, D.C. — The American Financial Services Association's president and chief executive officer Chris Stinebert came out with a statement this week saying the establishment of a Consumer Financial Protection Agency will be bad news for consumers when it comes to auto loans, mortgages and small business loans.

Basically, while his organization supports the administration's goals of better customer protection for borrowers and strong regulation for the financial services sector, Stinebert plainly states that the creation of a Consumer Financial Protection Agency "is not the way to go."

"Like health care, the administration's financial regulatory reform proposals should prompt consumers to think long and hard about the degree to which they want the federal government determining their choices and options," he explained.

"Under the proposed CFPA, the government essentially would have the role of deciding what type of mortgage, auto loan and small business loan is right for one consumer or another. The result will be fewer, less flexible borrowing options and higher prices for financial products and services at a time when Americans can least afford it," he continued.

Instead of establishing a new government agency, Stinebert said AFSA believes the keys to better protection include easy-to-understand disclosures, improvement financial education, the allocation of more resources for the current regulatory structure and better use of the expertise and experience of the existing agencies.

"This approach is likely to be far more effective, while leaving choice with consumers," he stated.