The nascent consumer agency dedicated to protecting borrowers from abusive lenders, a cornerstone of the Obama administration's efforts to reform the financial industry, will not be able to regulate the kinds of lenders that helped cause the crisis if the White House doesn't meet a key deadline, federal auditors say.

Firms like New Century Financial, Ameriquest, Fremont General and Countrywide Financial -- lenders that aren't banks and fall outside the bounds of regular federal supervision -- made the kinds of shoddy mortgage loans that ultimately led to the housing crisis. The Bureau of Consumer Financial Protection, currently led by Elizabeth Warren on an interim basis, is supposed to change that by putting them under the umbrella of a robust federal regulator. ...