ABI Survey Respondents Not Confident in Federal Protection Agency

Proposals from Congress would create a new governing body for financial products, though some aren't convinced it will work.

Mortgage problems and subprime lending may have contributed to troubles seen in states like California and Nevada, leading to some consumers having to file bankruptcy.

However, federal legislators are looking to stop these problems through legislation that would create a new consumer financial protection agency with the power to oversee products like home loans and credit cards. Currently, lawmakers are trying to iron out differences between proposals passed in the House and Senate.

The House bill would create an independent agency, while the Senate's version of financial overhauls would house it within the Federal Reserve System.

Regardless of how it turns out, a recent survey by the American Bankruptcy Institute noted that 49 percent of respondents - which included its members and the public - strongly disagreed with the idea that such an agency would be able to prevent the issues that caused the financial crisis.

Nevada, California and Arizona have all been heavily affected by the crisis, which saw more consumers filing bankruptcy despite federal laws that took effect in 2005. Those states have also faced some of the highest foreclosure rates.