UPDATE 1-No more tricks to boost bank profits – Obama adviser

* Banks not entitled to certain level of profit – Warren

* Adapt to new financial transparency or perish, she says

* Heads new financial watchdog opposed by Republicans
(Updates with more Warren comment)

By Alister Bull and Matt Spetalnick

WASHINGTON, Oct 12 (BestGrowthStock) – President Barack Obama’s new
chief consumer financial protection adviser warned banks on
Tuesday the days of tricking customers to fatten their profits
were over.

Elizabeth Warren said she did not believe lenders were
entitled to a “level of revenue set at a time that it was a
kind of ‘anything-goes’ world,” and firms that failed to adapt
to the new era of financial transparency would perish.

“The room for anybody in the financial services industry to
make their money by squeezing you here and squeezing you there,
tricks and traps, that is going to go away,” she told an online
White House forum to which the public submitted questions.

Obama appointed Warren last month to stand up a new
consumer protection bureau to ensure fair play in lending, in
order to prevent a repeat of the abuses that led to a subprime
mortgage crisis and a severe U.S. recession.

The bureau was created by Obama’s radical shake-up of Wall
Street regulation despite entrenched opposition from the
financial services industry and many Republican lawmakers, who
say it will hurt U.S. businesses and jobs.

The financial services industry had been particularly
hostile to Warren’s involvement in setting up the new agency,
accusing her of an anti Wall Street bias, evident over her many
years as a staunch advocate for consumer rights.

Republicans and conservative allies have deployed this anti
business argument against Obama’s Democrats ahead of the Nov. 2
midterm congressional elections, where the Republican Party is
expected to make significant gains.

Warren made plain that the new bureau was designed to put
lenders who relied on trickery out of business for good.


“I think there are some banks who will be glad to see that
day come,” Warren said, referring to the new bureau’s objective
to make financial products more transparent.

“I think the banks that don’t like it, that customers like
you are going to make the difference about whether they
survive,” she told one questioner.

Wall Street practices are back in the news three weeks from
the Nov. 2 poll amid concern that banks are evicting homeowners
who get behind in their mortgages by rushing through
foreclosures based on faulty paperwork.

Warren, asked about the foreclosure issue, acknowledged it
was a serious problem and said the federal government was
working with the industry to get a grip on the problem.

“I think right now the role is to do what we can — and I
don’t just mean we the agency, we’re in our infancy — but the
federal government in general, different agencies, to gather
information and try to get ahead of what’s going on,” she
(Additional reporting by Rachel Younglai; Editing by Anthony

UPDATE 1-No more tricks to boost bank profits – Obama adviser