WASHINGTON (7/18/12)--Credit union leaders from across Michigan joined Michigan Credit Union League CEO David Adams and league staff to urge the Consumer Financial Protection Bureau (CFPB) to consider the credit union difference in terms of structure, pricing, and membership, as it moves forward with future rulemaking.
More than a dozen credit union representatives met with CFPB Director Richard Cordray and CFPB Assistant Director Raj Date after a Monday field hearing in Detroit. The CFPB during that hearing announced plans to regulate credit reporting agencies. (See related July 17 News Now
story: Credit reporting agencies to come under CFPB scrutiny)
Consumer Financial Protection Bureau (CFPB) officials and other industry experts speak before a packed house at Monday's CFPB field hearing in Detroit. CFPB Director Richard Cordray met with Michigan credit unions and the Michigan Credit Union League later in the day. (MCUL photo)
A representative from Mortgage Center, a credit union service organization based in Southfield, Mich., also took part in the meeting.
Cordray and the group discussed the CFPB's recent mortgage disclosure proposal, financial elder abuse, retained income and the general regulatory climate for credit unions during the meeting. The group of credit union leaders told Cordray that they could do more to help consumers if the CFPB, in turn, helped credit unions.
Date said the CFPB wants to help credit unions by regulating irresponsible lenders that helped create the recent financial crisis. He noted that credit unions suffered twice due to the crisis: Once when irresponsible lenders pushed good lenders out of the mortgage market, and a second time when the financial markets crashed.
Adams emphasized that credit unions are also concerned about government attempts to regulate overdraft programs. "When the government tinkers with pricing, it has unintended consequences," Adams noted.
Genisys CU Vice President of Public Relations Lon Bone detailed how his credit union helps members that are about to incur overdraft fees by alerting them when the amount of funds in their account dips below a certain level. Cordray said this overdraft alert system is "an appealing practice."
Regulation CC, which governs when credit unions must make funds available that are deposited into share draft/checking accounts and what disclosure they must make about their check-hold policies, was also discussed during the meeting.
Christian Financial CU CEO Patty Campbell said financial institutions have had trouble complying with portions of the regulation that require them to provide a quick turnaround on deposited checks. The required turnaround on checks makes fraud easier, she said, adding that "if you want to deposit checks, there should be a hold on them."
Adams said the group was encouraged by how receptive Cordray was to credit union concerns.
Credit unions represented at the meeting included: Christian Financial CU, Roseville; Michigan First CU, Lathrup Village; Dort FCU, Flint; Omni Community CU, Battle Creek; Lake Trust CU, Lansing; Genisys CU. Auburn Hills; University of Michigan CU, Ann Arbor; and Co-op Services CU, Dearborn.