A new consumer protection agency is an urgent need as the United States seeks better financial regulation but putting it in the Federal Reserve is unacceptable, George Soros, chairman of Soros Fund Management, said on Wednesday.

We need a consumer protection agency, and we need it very urgently because there is political outcry about the injustice of the current situation, Soros said at a Roosevelt Institute conference in New York.

Senate Banking Committee Christopher Dodd has been trying to bridge a gap with Republicans, who oppose an independent consumer protection agency, and discussed with Republican Senator Bob Corker the possibility of making the agency a division of the Federal Reserve.

U.S. Representative Barney Frank this week told Reuters he thought it was a joke when he learned about the Dodd-Corker idea of a consumer protection unit in the Fed.

When Barney Frank called it a joke, I think he's right, Soros said. This is absolutely unacceptable.

Dodd and Corker may announce an agreement on Friday and release a summary of the details of their deal next week, one source familiar with the talks told Reuters.

(Additional reporting by Kevin Drawbaugh in Washington; Editing by Neil Stempleman)