Removing Barriers Blog

CUNA Member Represents Credit Unions at CFPB Field Hearing
Posted February 03, 2016 by Chandler Schuette

Today, at the CFPB’s field hearing discussing checking account access, CUNA member Sandy Gogan, senior vice president of Retail Operations at Park Community Credit Union, testified on behalf of credit unions. In her testimony, Gogan highlighted that credit unions already offer many products and services that help members manage finances. When discussing her credit union’s diverse products and service offerings, she noted that there is certainly a place for overdraft services. Gogan also outlined how credit unions, as part of their mission, are empowering members when providing services and helping their members navigate their many options.

Gogan also expressed the importance of the financial education that many credit unions offer. She highlighted the programs that Park Community Credit Union offers to help with financial education, including efforts to help members understand how to walk through credit reporting issues.  Gogan noted that most credit unions have similar financial education programs.

In his opening remarks, Director Cordray discussed a letter the CFPB sent to the largest 25 financial institutions encouraging them to have more options for checking accounts,  as opposed to overdraft services. The letter stated, “We therefore are urging all financial institutions to make these lower-risk offerings broadly available to consumers. We urge banks and credit unions that do not currently offer transaction accounts designed to help consumers avoid overdrafts to do so.”

We’ve noted that credit unions already offer many diverse options for checking accounts, and have consistently worked to find new ways to serve their members. But we also have concerns about the criticism of overdraft services in today’s letter, since concerns about this product are not shared by consumers according to the CFPB’s own data, which clearly illustrates that last year only 1.5 percent of consumer complaints pertained to overdraft.

We appreciate that Director Cordray apparently agrees with credit union concerns about the necessity of contacting credit union members on their cell phones about important account updates. In his remarks, he stated, “Let me also take a moment to acknowledge another positive development, which is the decision some banks and credit unions have made to provide consumers with real-time information about the funds in their accounts available to be spent.  They are doing this through various means, including online banking and text and e-mail alerts, which can reduce the risks that consumers inadvertently overspend their accounts.” 

We appreciate that the CFPB recognizes the importance of communicating with consumers, specifically through texts, and we hope the CFPB will coordinate with the FCC who recently made it more difficult for credit unions to do this through their TCPA Order.

After the hearing, the CFPB also held a credit union roundtable. During the roundtable credit union representatives and representatives from Kentucky Credit Union League met with Director Richard Cordray, Deputy Director David Silberman, and other CFPB staff members. During this discussion the group discussed checking account issues, and the risks that financial institutions take when offering them. There was also a lengthy discussion about credit union consumer education efforts. 

The CFPB also released a compliance bulletin (2016-01) about consumer reporting, which addresses compliance issues associated with furnishing information to consumer reporting agencies. CUNA’s COMPBLOG will have a detailed analysis of this bulletin. Below are the documents released by the CFPB today.

The letter sent to the financial institutions is available at:

The letter sent to the financial institutions is available at:

The guide to select a lower-risk account can be found at:

The guide to manage your checking account can be found at:

The consumer advisory about being denied a checking account can be found at: