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Removing Barriers Blog

CHOICE 2.0: Letter Sent Prior to Tomorrow’s Hearing
Posted April 25, 2017 by CUNA Advocacy

Tomorrow, the House Financial Services Committee will hold its hearing on the CHOICE 2.0 Act.  As mentioned last week, CUNA has been busy working its way through the nearly 600 pages of legislation since it was released on Wednesday.  This afternoon, CUNA sent a letterto Chairman Jeb Hensarling and Ranking Member Maxine Waters outlining CUNA’s position on CHOICE 2.0 in its current form.

With nearly every piece of legislation, there are both good and bad elements and things that need improvement.  While CHOICE 2.0 is not perfect, it does include several provisions that would make it easier for not-for-profit credit unions to more fully serve their members by reducing regulatory burden and providing more checks and balances to a regulatory scheme that today is rigged for large banks and nonbank financial service providers.  However, it also includes several provisions that perpetuate the rigged aspect of this system, including provisions that exempt nonbank providers from federal supervision and allow large banks to circumvent well established caps on market share.

CHOICE Act Provisions America’s Credit Unions Support

  • Regulatory Relief for Strongly Capitalized, Well-Managed Financial Institutions
  • Changes to the Structure and Authority of the Consumer Financial Protection Bureau
  • Bringing the Consumer Law Enforcement Agency Under the Appropriations Process
  • Consumer Law Enforcement Agency Inspector General Reform
  • Civil Investigative Demands to be Appealed in Courts
  • Economic Analysis and Review of Rules Required in Title III
  • Requiring the CFPB to issue Advisory Opinions
  • Removal of Agency UDAAP Authority and Preservation of UDAP Authority for Banking Regulators
  • Repeal of Authority to Restrict Arbitration
  • Improving Mortgage Lending Laws and Regulations
  • Home Mortgage Disclosure Adjustment
  • Homeowner Information Privacy Protection
  • Mortgage Choice
  • Portfolio Lending and Mortgage Access
  • Community Institution Mortgage Relief
  • National Credit Union Administration Budget Transparency and Overhead Transfer Rate Transparency
  • Examination Fairness
  • Safe Harbor for Reporting Elder Financial Abuse
  • Ending Regulator-Induced Account Terminations
  • Taking Account of Institutions with Low Operation Risk
  • Prohibition on Government Price Controls for Payment Card Transactions (Durbin Repeal)

CHOICE Act Provisions that Concern America’s Credit Unions

  • Federal Savings Association Charter Flexibility
  • Bringing the National Credit Union Administration under the Appropriations Process
  • Elimination of Consumer Law Enforcement Agency’s Supervisory Authority
  • Removal of Authority to Regulate Small Dollar Loans
  • Allowing Big Banks to Circumvent the 10 Percent Domestic Deposit Cap
  • Judicial Review of Financial Regulations 

Additional Proposals that America’s Credit Unions Ask Be Included in this Legislation

  • Strengthening the CFPB’s Exemption Authority
  • Installing a Five Member Commission at the CFPB
  • Parity in the Treatment of 1-4 Family Non-Owner Occupied Residential Loans
  • Treatment of the Business of Insurance

What now?
Tomorrow’s hearing on CHOICE 2.0 is the first step in a complex process that we hope will produce a new law reducing credit unions’ regulatory burden so they can more fully serve their members.  However, the process for producing regulatory reform legislation is long and the Committee’s consideration is only the first step and not the last.  The final legislation if it moves forward and through the Senate could look very different than what we have seen so far. As this and other legislation moves through the process, CUNA will be in constant contact with staff and Members of Congress in both the House and the Senate to ensure the legislation ultimately enacted into law meaningfully reduces credit unions’ regulatory burden and maintains important consumer protections.