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Removing Barriers Blog

NCUA Letter to CUs Provides Some Flexibility on MLA Compliance
Posted October 05, 2016 by CUNA Advocacy

In a Letter to Credit Unions (16-CU-07), NCUA Chairman Metsger notified credit unions that the agency will provide some flexibility for examination purposes as credit unions continue implementing changes necessary to comply with the revised DoD Military Lending Act regulation, which became effective this Monday (October 3). 

CUNA appreciates NCUA’s acknowledgment that credit unions and their vendors continue working on numerous changes required under the MLA rule. Last month, CUNA sent a letter to NCUA urging the agency to provide a safe harbor for credit unions as they complete these updates. 

In the Letter to Credit Unions, Metsger notes that, “NCUA examiners are instructed to accept a credit union’s reasonable and good faith efforts to comply with the new rule during the first examination following the implementation date. NCUA recognizes that some credit unions may need time to implement changes and work with their technology vendors to resolve problems that may arise from extensive testing and use, once their new MLA systems become fully operational.” 

Specifically, the Letter to Credit Unions states that during a credit union’s first examination after October 3, NCUA field staff will focus on: 

  • Ensuring the credit union is aware of the amendments to the MLA rule and determining the applicability of the amendments; 

  • Ensuring the credit union is making progress in complying with the rule, if applicable; and 

  • Assessing the quality of the credit union’s compliance risk management systems and its policies and procedures for implementing the program.