President Obama today unveiled a plan to overhaul the nation’s system of financial regulations in order to prevent the problems that led to the current economic crisis.

The plan includes the creation of a new agency to provide consumer protections for financial products such as home mortgages, credit cards, and payday loans.

Consumers Union, the nonprofit publisher of Consumer Reports magazine, has long advocated for such an agency.

Gail Hillebrand, the director of Consumers Union’s campaign for financial services reform, said, “We have laws to make sure that cars are safe, toys are safe, and medicines are safe. But when it comes to financial products like mortgages and credit cards, consumers don’t have the protections we need. This new agency would be charged with making sure consumers aren’t sold toxic financial products, with rules that crack down on bad practices and prevent new ones from emerging.”

Pamela Banks, senior policy counsel for Consumers Union, said, “The crisis surrounding mortgages and credit stems from lax regulation. No one was minding the store. We need a watchdog to help consumers understand the crazy quilt of financial offerings, and one that protects consumers from unscrupulous practices. This agency would be that watchdog. When consumers decide to make a financial commitment, they need to understand the bottom line before they sign their name on the dotted line. This plan helps consumers cut through the clutter and make educated decisions about their finances.”

The financial regulation overhaul plan would also give the Federal Reserve greater authority to supervise the largest financial institutions, and it would create a council of regulators to monitor risk throughout the broader financial system. Consumers Union said it looks forward to working with the White House and Congress to ensure that the new regulatory system is strong, effective, and fair to consumers, and has adequate checks and balances to prevent repeating the mistakes of the past.