The Interactive Advertising Bureau (IAB) signed a July 20, 2009 letter sent to Rep. Barney Frank of the House Committee on Financial Services raising questions–and really attempting to undermine–the Obama Administration’s proposed Consumer Financial Protection Agency. Others signing the letter included the Business Roundtable, Consumers Bankers Association, Consumer Data Industry Association, Financial Services Roundtable, the Real Estate Roundtable and the U.S. Chamber of Commerce. The IAB wasn’t the only ad lobby group signing the letter; so did the 4A’s and the DMA. My colleagues in the consumer community view the letter as an attempt to derail the bill [the letter, which asks for a delay on the bill, says that “there will be significant dangerous, unintended consequences if the legislation is enacted in its current form.”]
Why would the IAB be concerned about the creation of a new powerful consumer financial watchdog? It’s because their members work with companies engaged in digitally-related financial products–including mortgages, loans, credit cards, and so-called lead generation services. The IAB benefits from the hundreds of millions spent year year on interactive ads for financially-related services (Among the top 15 digital advertisers in 2008 were Scottrade, Tree.com, TD Ameritrade Holding Co, Bank of America, FMR Corp, Experian, etc.). The IAB is clearly afraid of having an agency that would be empowered to investigate how online marketers sell and promote a wide range of financial products online.
We do wonder whether IAB board members that support the Obama Administration’s proposal (which is widely backed by consumer groups) understand the implications of the position it has taken. Personally, I believe the creation of the new agency is critically important. We must ensure that American consumers are never again victims when buying financial products. Given that most of us will be learning about and purchasing financial services online, the proposed new agency will have to address how a number of IAB’s members engage in digitally-delivered financial services.
