Meet Holly Petraeus: U.S. Servicemembers' Advocate at the CFPB

Holly PetraeusSometimes, catastrophes can lead to changes that better protect us -- and by "us," I mean the residents of Main Street -- average Americans whose voices often get lost among the lobbyists and corporate interests.

For example, in response to the Great Depression, Congress in the 1930s created the Federal Deposit Insurance Corporation to regulate financial institutions and insure most of our bank deposits. Similarly, after the devastation of World War II, global powers established the United Nations to facilitate cooperation among, and maintain peace between, countries.

This week, America is witnessing the genesis of another agency born out of disaster and designed to protect us: the Consumer Financial Protection Bureau. Crafted by the Obama administration as part of the president's larger plan to reform Wall Street after the 2008 financial meltdown, the agency's purpose is to help consumers avoid being taken advantage of.

Specifically, the CFPB strives to create a marketplace for financial products -- including student loans, credit cards, mortgages, and prepaid cards -- "where customers can see prices and risks up front and where they can easily make product comparisons, in which no one can build a business model around unfair, deceptive or abusive practices, that works for American consumers, responsible providers, and the economy as a whole."

The CFPB, which describes itself as "a cop on the beat to enforce laws," officially opens its doors for business on Thursday. My colleague, Catherine New, recently published a CFPB "User's Guide" that details the agency's plans for better educating and protecting Americans.

Guiding Military Members Through Their 'Extra Challenges'

However, beyond its commitment to serving Americans in general, the CFPB has also dedicated resources exclusively to addressing the unique financial issues facing members of the U.S. armed forces and their families through the establishment of the Office of Servicemember Affairs. Holly Petraeus, who is not only the wife of Gen. David Petraeus, but also the daughter of, and mother to, servicemembers, oversees it.

In Petraeus' open letter on the CFPB's website, she writes: "we understand that military life can have some extra challenges, such as deployment and frequent moves, and that those challenges can sometimes have powerful financial repercussions. We also know that there are businesses and scammers that target servicemembers with bad deals and outright rip-offs," such as lenders who charge unusually high interest rates, or require advance payments in order to qualify for loans.

According to Petraeus, "scammers are very good at making things sound plausible," which is why she feels strongly that consumer education is a key component of OSA's work. She wants servicemembers to think about their financial decisions "ahead of time and decide if this really is the wisest decision I can be making right now?"

To that end, the OSA is focused on leveraging the financial education classes already offered through various military organizations. "We want to look at, are they teaching at the right teachable moments?" she asks. "And in a way that is engaging and that people really retain and put to use."

As Petraeus explains, soldiers, sailors and airmen face different issues depending on where they are in their lives and careers. "Certainly for a young servicemember, one of the first things they want to do is go out and buy that car, or buy that computer or that iPhone or that TV," she says. Here Petraeus is speaking from experience. As National Public Radio reported, Petraeus has confided to a room full of servicemembers that when she and her husband were younger, they "did some of the things that you know I don't recommend people do now – which is, buy the hot sports car, you know, sign the contract for the apartment sight unseen because they sent us a good-looking brochure."

Other practices Petraeus cautions against include calculating an item's price based only on the monthly payment instead of the total cost over time. She also strongly recommends that servicemembers who are in financial trouble consider all their options before taking an expensive loan. "If it's a true emergency that they need the money for, there are some military aid societies right there for them," she says, rattling off a list of resources the way some people explain a family tree.

"The Army Emergency Relief, the Navy-Marine Corps Relief Society, the Air Force has the Air Force Aid Society. And then there's the Coast Guard Mutual Assistance. So they're there to help with those emergency situations and they can give interest-free loans, sometimes even grants. So that would definitely be the best place to look. You know, you can't beat interest-free. And then there are other credit unions and banks that serve military installations, that would certainly be a place to look for a loan." She pauses, then adds, "I think probably one of the worst things you can do is go trolling on the Internet for a military loan. So many of those are not only expensive, but some are outright scams."

Petraeus talked more about her new role at the CFPB, and her financial advice for servicemembers and their families, in our video interview, conducted a few days before the bureau officially opened for business.



Loren Berlin is a columnist at DailyFinance.com. She can be reached at loren.berlin@teamaol.com. You can follow her on Twitter @LorenBerlin, and become a fan on Facebook.

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sk32086

I am glad that someone is adressing scammers out there that scam Vetetrans I as a Viet Nam veteran was scamed by a automobile Dealership in Orlando Fl Central Fl Lincoln advertised for sales persons and charged for the training and we did not get jobs we were promised I was not the only Veteran in the class training there we at least 3 more recent veterans in the training class that did not get the jobs they were promised maybe more that I do not know about now what kind of people would scam Veterans that have served there country with pride I will name names Mr Michael Zor trainer Mr Joe Alaverz sales Manager they are the scum of the earth scamming good hard working people telling them they were going to have jobs and not getting the jobs the owner of this dealership and 4 otheres in Fl Mr Bruce Deardoff should be ashamed of themselves for doing business in this manner It would please me if somebody would look into there ileagal practices maybe Mrs Petreaus and her new commettie can look into it and stop them from doing this again I have much information to prove about what I have just stated you can get in touch with me for any assistance at sk32086@aol.com thank you
Stephen Kirchon

July 21 2011 at 10:11 PM Report abuse rate up rate down Reply
worfff

another police state agency in place to take our freedom, oh but it`s for our protection, riiiiigggghhhht, with General Betray Us` pathetic name on it.

July 21 2011 at 9:48 PM Report abuse +1 rate up rate down Reply
George & Nancy

Oh I have to laugh at the great hypocrisy of the left. During the Bush admin, Gen Petraeus was so hated. Remember moveon ads reading "general betrayus?" Now he's wonderful. What gives people? Forget how you feel?

July 21 2011 at 9:12 PM Report abuse rate up rate down Reply
Glocks Mom

Oh great idea...."Come home to Grama" ! Let the General keep her ! More useless programs......like water down the drain....Another stupid attempt at a grasp at the 2012 election....

July 21 2011 at 8:51 PM Report abuse +1 rate up rate down Reply
scoutshaw46

Can we just stop with the new programs for the service and consolidate the one's we have so they function properly?

July 21 2011 at 8:32 PM Report abuse rate up rate down Reply
davandsher

Øbama wanted to make our service members who wrer injured in the line of duty responsible for paying the bill for what ever medical attention they recieved. How does that make you feel ?

July 21 2011 at 8:03 PM Report abuse +4 rate up rate down Reply
1 reply to davandsher's comment
Glocks Mom

"Come to Grama" !!! LMAO

July 21 2011 at 8:52 PM Report abuse rate up rate down Reply
Gloria Fredericks

Its called nepotism at its best.

July 21 2011 at 7:41 PM Report abuse rate up rate down Reply
MARLEYSGHOST

she ought to fight Congress to keep from cutting military pay and benifits !!!!!! and how about cutting out FORGIEN AID INSTEAD OF CUTTING SOCIAL SECURITY AND MEDICARE ALSO I AM SICK OF THIS ADMINISTRATION SCREWING THE SENIORS AND OUR MILITARY WHILE FAT CAT POLITICTIONS GET RICH OFF OUR SWEAT AND TEARS!!!!!! SO NEED TO CUT OUT A FEW TRILLION DOLLARS OFF THE BUDGET ? HERE IS HOW ; NO MORE FORGIEN AID UNTIL OUR NATIONAL DEBT IS PAID IN FULL!!!!!! NO MORE PORK THATS RIGHT PORK IN GOVERMENT SPENDING THE AMERICAN PEOPLE HAVE BEEN PORKED ENOUGH !!!!!! NO MORE TAX CUTS FOR THE RICH AND NO MORE AID TO FORGIEN GOVTS AND NO MORE STUPID GOVT GRANTS TO STUDY STUDIES

July 21 2011 at 7:22 PM Report abuse +8 rate up rate down Reply
1 reply to MARLEYSGHOST's comment
Glocks Mom

Dont over analyz...this, for you sake....you'll be dead with the rest of us, and we'll still be getting screwed !!

July 21 2011 at 8:54 PM Report abuse rate up rate down Reply
Lonny

Dang, he's got eight more medals than I do. I shoulda been a General, I guess...

July 21 2011 at 7:15 PM Report abuse -3 rate up rate down Reply
Nellie L. McCoy

The Petraeus issue seems great for service people. Many military people are often taken for a bad ride. The VA loans are not all for the retired family. Many people get tied up in debt trying to get a reduced loan that gradually rise yearly.

July 21 2011 at 7:14 PM Report abuse +5 rate up rate down Reply