Removing Barriers Blog

Leagues Continue to Seek Expanded Powers and Protections for Credit Unions
Posted January 13, 2017 by CUNA Advocacy

This week, 36 states were in session and legislation was introduced that would expand both powers and protections for credit unions.

In Oregon, H 2161 would empower credit unions by permitting amendments to articles of incorporation and bylaws to become automatically effective unless disapproved by the state regulator. If enacted, the bill also authorizes credit unions to expel members who create undue risk of loss. The measure further eliminates the requirement that boards of directors meet at least 10 times per calendar year and authorizes the regulator to establish rules regarding meeting frequency. 

A data security measure, H 2581, was introduced in Oregon as well. If enacted, in situations where retailer negligence causes breaches, they can be held liable to financial institutions for the costs associated with the breaches. Institutions could recover the costs for reissuing cards, stopping payments, closing accounts and notifying customers. The bill further directs state regulators to adopt security standards consistent with the Payment Card Industry Data Security Standards (“PCI DSS”), which are technical and business process requirements developed by the credit card industry to enhance payment card data security. 

Texas took steps to permit credit unions to conduct prize-linked savings programs with the introduction of the Texas Savings Promotion Act, H 471. The legislation authorizes credit unions to hold the raffles and outlines their parameters. Last session, the Governor vetoed a prize-linked savings bill, noting that an amendment to the Texas Constitution is required for the programs to be legally conducted. As such, TX HJR 37 was introduced. The bill would amend the Lotteries and Gaming Enterprises; Bingo Games section of the Texas Constitution to permit lawmakers to authorize “promotional activities to promote savings.” 

Like their colleagues in Texas, Delaware lawmakers are also considering legislation, H 31, that would permit credit unions to conduct prize-linked savings programs.

Bills impacting credit unions were introduced in New York. One measure, A 410, would require credit unions to have a notary public available during business hours and another, A 472, would bar financial institutions, including credit unions, from retaliating against employees.

Indiana lawmakers are exploring a bill that would prevent the public from being misled and protect the reputation of credit unions and other cooperatives. Under H 1236, businesses that are not cooperatives or mutual organizations would be prohibited from using the terms cooperative, co-op, or mutual in their names or marketing materials.