Removing Barriers Blog

Summary of 12/17 NCUA Board Meeting
Posted December 17, 2015 by CUNA Advocacy

The NCUA issued a Final Rule adding share insurance coverage for Lawyers Trust Accounts and other similar escrow accounts, and issued a Notice and Request for Comment regarding Regulatory Review in Accordance with the Economic Growth Regulatory Paperwork Reduction Act of 1996 (EGRPRA).  During the closed portion of the meeting the NCUA considered a Supervisory Action and received a briefing on a Supervisory matter.  These items were closed to the public.

We are dissapointed with this final IOLTA rule and our CEO Jim Nussle said "We have little doubt that the law gives NCUA the authority to extend insurance coverage to pre-paid accounts, and we are very disappointed that NCUA has not exercised that authority at this time. While we appreciate recent actions on business lending and field of membership aimed at removing from regulation requirements that are not in law, this final rule is an example of the agency unnecessarily impeding access to credit unions by making it more difficult for them to offer products and services to their members.”

Final Rule – Part 745, Adding Share Insurance Coverage for Lawyers Trust Accounts and Other Similar Escrow Accounts.

This Final Rule amends NCUA’s share insurance regulations to implement the Credit Union Share Insurance Fund Parity Act to provide enhanced, pass-through share insurance for interest on lawyers trust accounts (IOLTA) and other similar escrow accounts.  Specifically it will provide pass through insurance coverage for IOLTA accounts, real estate escrow accounts and prepaid funeral accounts, as well as any other escrow account that meets the definition of “other similar escrow accounts” contained in the rule.  The rule generally does not provide pass through coverage for prepaid cards unless the prepaid card satisfies the definition of “other similar escrow accounts” contained in the rule, or otherwise qualifies for share insurance.

Notice and Request for Comment, Regulatory Review in Accordance with the Economic Growth Regulatory Paperwork Reduction Act of 1996.

This Request for Comment pursuant to EGRPRA is the last and fourth notice of the second decennial review of agency regulations.  This final notice covers two categories of rules including Rules of Procedure and Safety and Soundness Rules.  The notice seeks comments from the public and industry oh how the burden imposed by the rules might be reduced or eliminated.