Removing Barriers Blog

CUNA Refutes Director Cordray's Comments on Impact of CFPB Regulations
Posted December 03,2015 by CUNA Advocacy

On Thursday, CFPB Director Richard Cordray told activists at the Consumer Federation of America's annual conference that predictions the Bureau rules would lead to providers leaving markets, making financial services less available to consumers, have been proved false.

CUNA refuted Director Cordray's comments in the following statement:

“Director Cordray told consumer advocates today that concerns raised by credit unions and others regarding the impact the Bureau’s regulations have had on the availability of financial products and services have proven false. We firmly dispute this conclusion. 

 “When a regulation makes it more difficult or more expensive for a credit union to serve its member-owner, the regulation has failed credit union members. When credit unions stop offering products because of regulation, leaving consumers’ only option large banks and less regulated non-bank providers, the regulation has failed consumers.

 “The remittance regulation is a good example of a rule that may have been well intended, but has limited consumer choice and the availability of safe and cost-effective service. Almost half of the credit unions that offered remittance services prior to the regulation have either stopped offering them or purposefully limit the number they do because of the rule, forcing consumers to go to providers they need the most protection from. How can that possibly help consumers?

 “The Bureau was created to make sure that financial products and services work better for the people who use them, but they’re failing to fulfill their mission by overregulating credit unions. Increased regulatory burden has undoubtedly increased the costs of providing services. And, whenever the costs of providing services go up, less of it is provided.

 “The Bureau has very wide latitude to exempt any class of covered entity from its regulation. There is no doubt it is well within their authority to exempt not-for-profit, member-owned credit unions from their regulations. But, the Director and his staff have been very reluctant to use this authority, and their reluctance is costing consumers fuller access to safe and affordable financial services provided by financial institutions they own.”