CUNA seeks oversight of CU reg burden

December 11, 2007

FOR IMMEDIATE RELEASE
Contact: Patrick Keefe -- (202) 508-6765 pkeefe@cuna.com

CUNA has urged the chairman of the House Financial Services Committee to look into two areas of potential and growing regulatory burden for credit unions: New rules on Internet gambling, and Bank Secrecy Act (BSA) requirements.v

Specifically, CUNA asked Rep. Barney Frank, D-Mass. and chairman of the committee, to consider a moratorium on implementation of pending Internet gambling regulations, now being developed by the Treasury Department and Federal Reserve. Regarding BSA, CUNA suggested the full committee look at the scope of BSA requirements, as well as enforcement inconsistencies.

“The growing burden credit unions must bear is increasingly diverting them from meeting their primary objective of serving their members,” CUNA wrote.

The complete text of CUNA’s letter follows:

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December 10, 2007

The Honorable Barney Frank
Chairman
House Financial Services Committee
2129 RHOB
Washington, DC 20515

Dear Chairman Frank:

On behalf of the Credit Union National Association, I am writing you on two matters of serious concern to our members -- the implementation of the Unlawful Internet Gambling Enforcement Act of 2006 and Bank Secrecy Act requirements.

The enforcement of prohibitions on unlawful Internet gambling is a laudatory goal, and we support reasonable efforts to protect consumers from falling prey to unscrupulous unlawful gaming activities through the Internet. However, our members are concerned that implementation of the new law will place unforeseen regulatory burdens on financial institutions, as evidenced by the pending proposal from the U.S. Department of Treasury and the Federal Reserve Board that is open for comments through December 12, 2007. We urge you to step in now to direct a moratorium on the implementation of the pending proposal, until a more reasonable approach can be considered by Congress and the regulators.

Concerning BSA, we appreciate the leadership you and Chairman of the House Financial Services Subcommittee on Oversight and Investigations Melvin Watt (D-NC) demonstrated in May by holding the hearing on Currency Transaction Reports (CTRs) and Suspicious Activity Reports (SARs). We believe the review was very productive, and a number of concerns were raised about the reporting requirements related to these forms. We also appreciate the opportunity CUNA’s BSA Task Force, chaired by Eugene Foley, President and CEO of Harvard Employees Credit Union, had last week to meet with your staff. In light of the continuing issues regarding BSA, we believe it would be extremely beneficial for the full Committee to look at the scope of BSA requirements that financial institutions must meet as well as enforcement inconsistencies. We know how busy the Committee has been and will likely be next year but would welcome such a review as soon as possible in 2008.

Credit unions are not looking for ways to simply avoid regulatory responsibilities, and they support efficient efforts to combat terrorism and regulate money laundering. However, the growing burden credit unions must bear is increasingly diverting them from meeting their primary objective of serving their members. We look forward to working with you on these and other issues with the goal of facilitating credit union service to our nation’s consumers. Thank you for your attention to these issues.

Sincerely,

Daniel A. Mica
President and CEO

Cc: Ranking Committee Member Spencer Bachus (R-AL)

About CUNA
With its network of affiliated state credit union leagues, Credit Union National Association (CUNA) serves over 90 percent of America's 8,800 credit unions, which are owned by more than 90 million consumer members. Credit unions are not-for-profit cooperatives providing affordable financial services to people from all walks of life. For more information, visit www.cuna.org.

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