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NCUA, AARP team up for fin. ed. initiatives, outreach

ALEXANDRIA, Va. (9/12/14)--The National Credit Union Administration has announced a new alliance in the effort to increase the financial literacy of the American public.

The agency said Thursday that it will team up with the AARP to work on a series of initiatives to promote financial education and outreach. The intention is to help consumers achieve financial security and increase access to responsible and affordable financial services.

According to the NCUA, joint activities will include sharing financial education tools and resources, co-hosting events in communities and online and participating in working groups with one another and other organizations.

The two organizations have signed a memorandum of understanding outlining a two-year plan for initiatives that will cover consumer-friendly financial services, anti-fraud efforts, entrepreneurship and financial literacy, among others.

"Promoting financial literacy is an important goal for NCUA and one of the core missions of federally insured credit unions," NCUA Chair Debbie Matz said. "There are many areas where AARP and NCUA can work together to strengthen the financial health of Americans of all ages."

According to the NCUA, activities will include, but are not limited to, sharing of financial education tools and resources, co-hosting events in communities and online and participating in working groups with one another and with other organizations.

The NCUA participated in the AARP's Ideas@50+ event in San Diego last week, providing informational material to hundreds in attendance about credit union services, share insurance coverage, elder financial abuse and the agency's financial literacy resources.

The agency currently offers financial education materials geared toward all populations at its website.

Use the resource link below to access previous News Now coverage of the NCUA's financial literacy programs.

Technical amendments, stabilization fund report on NCUA meeting agenda

ALEXANDRIA, Va. (9/12/14)--The National Credit Union Administration has released the agenda for its monthly board meeting, which will be held Sept. 18. The meeting will be the first with new board member J. Mark McWatters, who took office last month.

The agenda includes discussion of a final rule containing technical amendments to parts 701 (organization and operations of federal credit unions), 706 (unfair or deceptive acts or practices) and 790 (description of NCUA; requests for agency action) of the NCUA's rules and regulations.

The technical amendments are likely to involve:
  • An update reflecting the fact that the Dodd-Frank Act stripped the NCUA of rule-writing authority for unfair or deceptive acts and practices;
  • An update reflecting changed central office and regional structure; and
  • Renaming payday/small amount, small dollar loans "payday alternative loans."
The agenda will also include a request to expand community charter from First Service FCU, based in Groveport, Ohio, with $136 million in assets, and the quarterly report on the Corporate Stabilization Fund.

The meeting will take place at the NCUA's Alexandria headquarters, starting at 10 a.m. (ET).

A video recording of the meeting will be made available in the coming weeks, once the recording is made accessible to the hearing and visually impaired.

UBIT Steering Committee receives prestigious Pierre Jay Award

WASHINGTON (9/12/14)--The UBIT Steering Committee, comprised of the Credit Union National Association, CUNA Mutual Group, the American Association of Credit Union Leagues and the National Association of State Credit Union Supervisors (NASCUS), was recognized Thursday for its long and diligent work that successfully persuaded the Internal Revenue Service to issue examiner guidance on unrelated business income tax (UBIT).
After almost 20 years of advocacy by the UBIT committee, credit unions in April received a much-sought-after interpretation by the IRS that cleared nearly all credit union products from being subject to UBIT.
The prestigious Pierre Jay Award was awarded by NASCUS at its 2014 State System Summit in Nashville, Tenn.  
NASCUS noted that a turning point in the steering committee's work came in 2009, when Community First CU, Appleton, Wis., prevailed in a jury trial against the IRS on UBIT issues, and when a federal court in Colorado ruled in favor of Bellco CU, Greenwood Village, Colo., in its UBIT challenge. The steering committee had worked closely with both credit unions in support of the litigation.
Receiving the award on behalf of CUNA were Kathy Thompson, CUNA's senior vice president of compliance and legislative analysis; Larry Blanchard, CUNA Mutual Group legislative consultant, on behalf of CUNA Mutual Group; Fred Robinson, Tennessee Credit Union League president/CEO, on behalf of AACUL; and Mary Martha Fortney, NASCUS president/CEO, on behalf of NASCUS.
NASCUS first presented the Pierre Jay Award in 1997. It's named after Massachusetts' first commissioner of banks, who is considered instrumental in shaping credit union history.

Cordray addresses new mortgage forms, eClosing pilot program

WASHINGTON (9/12/14)--With new mortgage form requirements going into effect in less than a year, and technology offering solutions to make loan paperwork simpler for consumers and lenders, Consumer Financial Protection Bureau (CFPB) Director Richard Cordray took some time to address those issues this week.

"The Consumer Financial Protection Bureau has enjoyed a great relationship with credit unions. We see eye-to-eye on many things, most of all that we both aim to serve Americans who are not only your members but also the consumers we work so hard to protect," Cordray said, speaking at the National Association of Federal Credit Unions Congressional Caucus.

The bureau's new mortgage disclosure forms will take effect Aug. 1, 2015, and Cordray provided some details of the program.

The new rule is intended to ensure that homebuyers no longer receive overlapping forms from lenders and the government. Under the new rules, consumers will get a single form after applying for the loan, known as the loan estimate, and one form before finalizing the loan, known as the loan disclosure.

"These new forms will enable consumers more readily to spot crucial information that demands their focus, such as the interest rate, monthly payments and total closing costs, as well as any special risk factors that could lead to payment increases over time," Cordray said. "The underlying premise for both the loan estimate and the closing disclosure is that consumers will be better able to understand the mortgages they are buying and the costs they are paying."

Cordray added that, though the forms are not required until August 2015, lenders should already be working on the rule and preparing for the change. The bureau is working on a readiness guide for the regulations to be released in the coming months.

The CFPB has been hosting a series of webinars leading up to the implementation date, and the next one is scheduled for Oct. 1.

Cordray also provided a summary on the bureau's eClosing pilot program, which will include two credit unions, BECU, Tukwila, Wash., with $12.6 billion in assets, and Mountain America CU, West Jordan, Utah, with $3.8 billion in assets ( News Now Aug. 22 and Sept. 4).

"This pilot will explore how the increased use of technology during the mortgage closing process could affect consumer understanding and engagement and save time and money for consumers, lenders, and other market participants," he said.

Use the resource links below for more information.

Rep. Waters proposes bill to improve consumer credit reporting

WASHINGTON (9/12/14)--Credit scores play an important role in buying a house, or obtaining a job, and Rep. Maxine Waters (D-Calif.) has introduced an bill designed to help consumers' scores recover faster.

The Fair Credit Reporting Improvement Act of 2014 is meant to enhance requirements for consumer reporting agencies (CRA), as well as those who provide information to the CRAs, with the hope of guaranteeing consumers the ability to ensure their credit report information is accurate and complete.

According to the Federal Trade Commission, 1 in 5, or roughly 40 million consumers, have had an error on one of their credit reports. Approximately 10 million consumers have errors that could increase the cost of credit available to them.

Key provisions in the bill include:
  • Providing relief to millions of borrowers victimized by predatory mortgage lenders and servicers, by removing adverse information about these residential loans that are found to be unfair, deceptive, abusive, fraudulent or illegal; 

  • Shortening by three years that most adverse information can remain on a person's credit report;

  • Giving consumers tools to verify the accuracy and completeness of their credit reports, by mandating that furnishers retain all records for as long as adverse information about these accounts remains on a person's credit report;

  • Eliminating punitive credit scoring practices by removing fully paid or settled debt from credit reports, including medical debt;

  • Giving distressed private education loan borrowers the same chance to repair their credit as federal student loan borrowers, by removing adverse information when delinquent private education loan borrowers make consecutive on-time monthly payments for a certain period of time on their loans.

  • Restricting the use of credit reports for employment purposes; and

  • Setting a dollar amount that a consumer can be charged to buy their credit score from CRAs, while also requiring CRAs to provide consumers with a free annual credit or educational credit score upon a consumer's request.   
Use the resource links below to access the full text of the discussion draft and a summary document.

Inside Washington (09/12/2014)

  • WASHINGTON (9/12/14)-- The lead Republican on the Senate Intelligence Committee said this week that he is still hopeful that chamber will pass cybersecurity legislation before the end of the year. In remarks at a cybersecurity event on protecting the payments system, which was hosted by the Merchant Financial Cyber Partnership and Bloomberg Government, Sen. Saxby Chambliss (R-Ga.) said he's "cautiously optimistic" the Senate can take up his information-sharing bill during the post-November election, lame-duck session ( American Banker Sept. 11 ). The bill is co-sponsored by Senate Intelligence Committee Chair Diane Feinstein (D-Calif.). Even if passed before end of the year, the Senate still would have to work with House members to reconcile provisions of its competing information-sharing legislation, passed earlier this year. However, Chambliss said that if the Senate passes the bill, Senate and House lawmakers are prepared to go to conference immediately to hammer out final legislation that can be signed into law by the president. The article noted that Michael Daniel, special assistant to the president and cybersecurity coordinator for the White House, said that the Obama administration remains encouraged by the efforts in Congress ...

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