Comment Letters: 2012
National Credit Union Administration (NCUA)
NCUA Proposal on Loan Participations
February 16, 2012
In the strongest terms appropriate, CUNA urges the Board to withdraw the proposal as issued. In today’s
overregulated environment, this proposal would add to the regulatory burden of affected credit unions in a manner
that is wholly disproportionate to the risks associated with loan participations. While the proposal seeks to
address concentration risks and other issues the agency has identified concerning loan participations, it would do
so at the price of severely limiting, if not eliminating, sound participation programs that serve credit unions,
their members, and other credit unions well. The proposal would also seriously undermine lending programs and even
earnings for some credit unions.
Updated Interagency Guidance Regarding Flood Insurance
December 1, 2011
CUNA generally agrees that the three proposed interagency Q&As regarding force placement of flood insurance
are consistent with the National Flood Insurance Reform Act of 1994 Act and its regulations. These interagency
Q&As last updated in 2009 serve as guidance on flood insurance requirements for credit unions and other financial
institutions, agency personnel, and the public. The three proposed interagency Q&As are intended to provide
clearer guidance about the force placement of flood insurance, to clarify additional areas and avoid potential
misunderstandings.
Consumer Financial Protection Bureau (CFPB)
Fair Credit Reporting (Regulation V)
February 21, 2011
This comment letter represents the views of the Credit Union National Association (CUNA) regarding the Consumer
Financial Protection Bureau’s (CFPB’s) republished Regulation V – Fair Credit Reporting (Reg V), which implements
the Fair Credit Reporting Act. The interim final rule substantially incorporates the inherited regulations from
other agencies and duplicates Reg V from the Federal Reserve Board (Fed), making only certain non-substantive,
technical, formatting, and stylistic changes, and does not impose any new substantive obligations on persons
subject to the existing regulation.
Real Estate Settlement Procedures Act
February 21, 2011
CUNA applauds the CFPB for its approach on combining the RESPA and TILA forms under its “Know Before You Owe”
mortgage project, and CUNA’s inclusion on the working groups the agency has established for direct feedback on
the forms’ revisions. In this letter, CUNA is also urging the CFPB to consider placing into one location all
guidance and instructions with respect to the proper completion of these forms, as the agency continues to
complete this phase of the Dodd-Frank Act mandates. Additionally, CUNA has asked for sufficient time for
lenders to implement any new rules that may be promulgated in the future which would affect Reg X, and has
urged the CFPB to allow for at least one full calendar year beyond the date a final rule is promulgated when
implementing any mandatory compliance date within such a rule. CUNA has also urged the CFPB to examine certain
definitions within Reg X and to make such definitions consistent, where permissible and where appropriate, with
similar definitions located in either other regulations that fall under the purview of the CFPB or the
underlying statute of the rule. CUNA has asked the CFPB to provide additional clarifications and examples
as to what does and does not constitute a “thing of value” in connection with the prohibition of referral
fees in connection with Section 8 of RESPA. Finally, CUNA has urged the CFPB to consider the difficulties
that many credit union lenders face when determining whether a particular loan is covered by Reg X, Reg Z or
both for purposes of determining the appropriate consumer protection disclosures that must be provided.
Comments on Regulation B, Equal Credit Opportunity Act
February 21, 2011
The interim final rule substantially duplicates the rule of the Federal Reserve Board (Board) under the Act,
Regulation B, 12 C.F.R. Part 202, and incorporates the appendixes, model forms, and supplements that were
included with the Board’s regulation. The rule has been edited to include wording and other technical revisions
required by the Dodd-Frank Act but the changes are not intended to impose any new substantive requirements on
entities covered by the regulation. CUNA strongly supports equal opportunities for consumers and small businesses
to belong to and benefit from credit unions, which routinely seek to serve their members and communities by
providing favorable rates on loans and savings.
Interim Final Rule – Privacy of Consumer Financial Information
(Regulation P)
February 21, 2011
The Dodd-Frank Act requires the CFPB to assume authority relating to Regulation P. The CFPB combined the
Regulation P rules of eight different agencies into one comprehensive interim final rule. In its comment
letter, CUNA requests that the CFPB consider removing the requirement that financial institutions send an
annual privacy notice to every consumer with whom the institution has a continuing relationship. CUNA
recommends amending the annual privacy notice requirement to require financial institutions to provide a
revised privacy notice to the customer only when a change is made to the institution’s privacy policy.
This would not affect the existing requirement that the institution provide an initial privacy notice to
the customer at the time the relationship is established. Eliminating the annual privacy notice requirement,
except in the event any changes have been made to the institutions’ privacy policy, will help to relieve the
regulatory burden on financial institutions. CUNA understands that any change to this requirement may
require a legislative amendment to Section 503(a) of the Gramm-Leach-Bliley Act. We encourage the CFPB to
seek this legislative change in the event it is necessary.
SAFE Act Interim Final Rule
February 17, 2011
While CUNA recognizes that the Rule substantially duplicates the rules previously promulgated by the OCC, the
Federal Reserve Board, the FDIC, the OTS, the Farm Credit Administration, and the National Credit Union Administration
(NCUA) and does not impose any new substantive obligations on regulated entities, CUNA wishes to take this opportunity
to provide input to the CFPB concerning the substance of the Rule itself. In particular, CUNA has had longstanding
concerns, which we have provided to NCUA, regarding the use of certain terms in the rule.
Interim Final Rule – Home Mortgage Disclosure Act (Regulation C)
February 17, 2011
The CFPB has issued an interim final rule to republish (as the CFPB’s new Reg C) the Federal Reserve Board’s
Regulation C which implements the Home Mortgage Disclosure Act. While this interim final rule does not cover the
new required data elements under HMDA which are required as part of the Dodd-Frank Act, CUNA is urging the CFPB to
consider additional regulatory burdens and costs which may be placed on covered credit unions under any future rules
promulgated by the agency. CUNA is also advocating for a change in the procedures concerning data collection on
ethnicity, race and sex with respect to mortgage loan applications which are taken in person, but elects not to
provide this information to the lender, to be more in line with those applications which are taken via mail,
telephone or internet. Additionally, CUNA is urging the CFPB to harmonize, where permissible and where appropriate,
certain definitions within Regulation C with either other regulations that fall under the purview of the CFPB or the
underlying statute of the regulation. Finally, CUNA asks that the CFPB work to minimize the regulatory burden
associated with HMDA reporting on credit unions of all sizes.
Interim Final Rule – Consumer Leasing (Regulation M)
February 17, 2011
The CFPB has issued an interim final rule to republish (as the CFPB’s new Reg M) the Federal Reserve Board’s
Regulation M which implements the Consumer Leasing Act of 1976. CUNA believes the Reg M interim final rule is
consistent with the existing regulation, but we urge the CFPB to streamline its inherited regulations, including Reg
M, by updating, modifying, or eliminating outdated, unduly burdensome, or unnecessary provisions. We also urge the
agency to minimize the overall regulatory burdens and costs for credit unions in the event the CFPB decides to alter
existing requirements concerning the uniform cost and other disclosure requirements relating to consumer lease
transactions under Reg M.
Interim Final Rule – Mortgage Advertising and Mortgage
Assistance Relief Services (Regulations N & O)
February 14, 2012
The CFPB has issued an interim final rule to republish (as the CFPB's new Regs N and O) the FTC's regulations
concerning unfair and deceptive acts and practices (UDAP) regarding mortgage advertising and mortgage assistance
relief services. Although we support the goals of Regs N and O, which are primarily to protect the consumer, we
ask the CFPB to consider how the requirements of these regulations can be minimized for state-chartered credit
unions since it appears these entities are covered under general rulemaking authority to address unfair and
deceptive acts and practices rather than specific provisions related to credit unions.
Interim Final Rule – Requirements for Non-Federally Insured
Financial Institutions – Regulation I
February 14, 2012
The Dodd-Frank Act requires the Consumer Financial Protection Bureau (CFPB) to assume regulatory authority regarding
disclosures and other requirements for non-federally insured depository institutions, such as privately insured credit
unions, under the Federal Deposit Insurance Act (FDIA). CUNA is not seeking changes to the regulation at this time.
However, we encourage the CFPB to work with American Share Insurance Company regarding the implementation and
enforcement of Regulation I.
Interim Final Rule – Fair Debt Collection Practices Act
(Regulation E)
February 14, 2012
F
The CFPB has issued an interim final rule to republish (as the CFPB’s new Reg F) the procedures that states may
use to apply for exemption from the Fair Debt Collection Practices Act, as implemented by the FTC. While only a
small number of credit unions participate in debt collection services covered by Reg F, CUNA’s comment letter
asks the CFPB to thoroughly analyze this and subsequent CFPB rules to identify changes in the rules that would
minimize the regulatory compliance burden on credit unions, and then initiate the process for making such changes,
in instances where the agency believes it has adequate authority to do so.
Policy Statement on Disclosure of Certain Credit Card Complaint
Data (Large Issuers)
January 30, 2012
CUNA supports the ability of consumers to have timely and clear information on responsible credit card use. However,
we do not support the public release of certain credit card complaint information that is separate from and in
addition to the agency’s periodic reports and analyses, which provide more complete credit card complaint information
to consumers. While we do not anticipate that credit unions, as member-owned cooperatives, will be the subject of a
sizable number of complaints, nonetheless we have concerns the proposed public data release could have unintended
consequences.
Request for Information Regarding Private Education Loans and
Private Educational Lenders
January 17, 2012
CUNA and its members support the CFPB’s efforts to gather information regarding private student lending and to
study closely the private student lending market, consistent with your authority under the Dodd-Frank Act. There
are about 300 credit unions that currently offer student loans to their members and they want to ensure they are
providing lending products that have favorable rates and other terms and that their members understand their
obligations under the loan agreement, as credit unions do with other loans provided to their members. In that
connection, we encourage the CFPB to be mindful of the positive role credit unions play in providing student
loans to members pursuing educational opportunities. We also encourage the CFPB to continue to take an analytical
and deliberative approach to its information gathering and rulemaking efforts, particularly with regard to
generating a report regarding private education loans and private education lenders and with any follow-up
actions. Along these lines, to the extent the CFPB has authority to do so, we encourage the CFPB to study the
costs of higher education, the value received from higher education, and its costs on students and their families,
and provide a report to Congress on its findings.
Mortgage Servicing Forms
January 13, 2012
CUNA supports the CFPB’s core objective in its mortgage servicing forms information gathering effort to help
refine specific features of the content and design of the mortgage servicing model forms to maximize communication
effectiveness while minimizing compliance burden. CUNA encourages the CFPB take the same analytical and deliberative
approach it has taken thus far with respect to its various information gathering and rulemaking efforts, by seeking
information from a broad sample of industry participants and by releasing several draft model servicing forms for
comment during the drafting period. We ask that CFPB gather information from participants in all areas of the
mortgage servicing market, including credit unions and other small mortgage lenders and servicers. CUNA also
requests that this process place emphasis on the compliance burden associated with adopting new model forms,
and that the CFPB ensure that any compliance burden for servicers is minimized – especially for small servicers.
Provided these steps are effectively taken, CUNA believes that this information gathering process could help
minimize any compliance burden associated with adopting new model servicing forms, particularly for small
servicers.
Federal Housing Finance Agency (FHFA)
FHFA-FHLB Community Support Amendments
February 8, 2012
CUNA is generally opposed to the FHFA’s proposed rule which would amend the community support regulation to
require the Federal Home Loan Banks (FHLB), as opposed to the FHFA, to monitor and assess the eligibility of
each FHLB member for access to long-term advances through compliance with the Community Reinvestment Act of
1977 and first-time homebuyer standards. CUNA has significant concerns that the proposed rule would require
the FHLBs to act as regulators of their members, if finalized as proposed.
Alternative Mortgage Servicing Compensation Discussion Paper
December 27, 2011
CUNA and its members urge FHFA to release further details on each proposal laid out in the Discussion Paper, and
to refrain from making any changes to the servicing compensation structure until the future of the GSEs are
determined and national servicing standards are developed. While we understand FHFA’s objectives, it is
impossible to understand at this point what the effects of either proposal will be on credit unions and on
the industry as a whole. We also believe any change in servicing compensation at this point is premature,
in light of the myriad servicing standards proposals flowing from various initiatives by agencies, legislators,
and Attorneys General. CUNA and its members are also concerned that the reduction in servicing compensation
proposed under either option will lead to consolidation in the industry, driving out the small servicers and
significantly reducing competition.
Federal Trade Commission (FTC)
Child Online Privacy Protection Act
December 22, 2011
The FTC proposal would revise the existing Child Online Privacy Protection Act (COPPA) rules established in
2000 to change their parental consent and disclosure requirements, among other things. CUNA supports the FTC’s
efforts to protect children. We urge the agency, however, to modify several aspects of the proposal in order
to make it easier for credit unions to obtain parental consent under the COPPA rules and limit unnecessary
disclosure requirements. Credit unions frequently provide savings accounts and other limited services to
children and seek to help them develop productive savings habits. Credit unions also provide children and
other minors with financial literacy education that will serve them well as financial service users and borrowers.
Many credit unions engage in youth outreach using CUNA’s Googolplex, a financial literacy website for young
people, as well as the National Credit Union Foundation’s “Biz Kid$” financial literacy initiative that
teaches children and teens about money and business.
Financial Accounting Foundation (FAF)
Proposed Plan to Improve Private Company Standard
January 13, 2012
We appreciate the Foundation’s initiative in addressing
the issue of whether improvements are necessary for private entity accounting and, if so, how to best
facilitate such improvements. We believe strongly that there is a need for improvements to the accounting
standards that private companies must work under on a daily basis. We agree with constituents, as noted in
the Foundation’s proposed plan, that “complexity” in financial reporting is, in many ways, the real problem
for private entities. In regard to the proposed Council, we support the Foundation’s general approach to
address the concerns raised by private entities, and offer several suggestions for the Foundation to consider.
Housing and Urban Development (HUD)
Proposed Rule Implementing a Discriminatory Effects Standard
into the Fair Housing Act
January 17, 2012
CUNA believes that incorporating a discriminatory effects standard into the Fair Housing Act is premature at this
point. HUD should not consider implementing a discriminatory effects standard until after the U.S. Supreme Court
has reached a decision in Magner v. Gallagher, No. 10-1032. The U.S. Supreme Court granted certiorari in this case
on November 7, 2011 and oral argument is scheduled for February 29, 2012. In Magner v. Gallagher, the U.S. Supreme
Court will review the precise issues that HUD’s proposed rule addresses. The questions presented in the case are
(1) whether a lawsuit can be brought for a violation of the Fair Housing Act based on a practice that does not have
a discriminatory intent but instead has a discriminatory effect, and (2) if so, what test should be used to
determine whether a practice has a discriminatory effect and therefore violates the Fair Housing Act? CUNA is
concerned that implementing a uniform discriminatory effects standard before Magner v. Gallagher is decided could
cause unnecessary confusion for both lenders and borrowers regarding the proper interpretation of the Fair Housing
Act.
Internal Revenue Service (IRS)
Determination of Governmental Plan Status
February 6, 2012
CUNA is generally supportive of the IRS’s advance notice of proposed rulemaking and accompanying draft proposed
rule to establish regulations that would provide general guidance relating to the determination of whether a
retirement plan is a governmental plan within the meaning of § 414(d) of the Internal Revenue Code..
NACHA (Electronic Payments Association)
Expedited Processing and Settlement (EPS)
December 12, 2011
CUNA appreciates NACHA’s objective to provide a new premium same-day, expedited payment service on the ACH network.
However, we believe not all receiving financial institutions should be required to receive and post same-day ACH
payments because of significant implementation and risk management concerns, especially for smaller credit unions and
other financial institutions. Instead, NACHA should permit credit unions and others to opt in to the new EPS service or
conduct a pilot program first to study the extensive effects of the proposal before taking further action.
