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CFPB recently announced two opportunities for credit unions to engage with CFPB leadership and staff.
This week, the House will consider H.R. 9, the Climate Action Now Act. The House will also consider several bills under “suspension of the rules.” Included are: H.Res. 327, a bill “Encouraging greater public-private sector collaboration to promote financial literacy for students and young adults” as well as H.Res. 328, legislation “Supporting the protection of elders through financial literacy.”
The Senate will vote on several executive branch nominations.
The Consumer Financial Protection Bureau (CFPB) has issued a Request for Information on its remittance rule, a rule which CUNA has called on the Bureau to revise. CUNA raised this issue on several occasions with new CFPB Director Kathy Kraninger since she took over as agency director, including in a letter when she was first confirmed and in multiple face-to-face meetings.“CUNA has asked the CFPB for years to finalize substantive amendments to the remittance rule in order to balance necessary consumer protections with a more tailored regulation that allows consumers access to these services,” said CUNA President/CEO Jim Nussle. “We’re thankful to the CFPB for starting this process, and we thank our league and credit union partners who stressed the importance of this issue in meetings with Director Kraninger, CFPB staff and other policymakers.”
CUNA President/CEO Jim Nussle, Chief Advocacy Officer Ryan Donovan, Deputy Chief Advocacy Officer Elizabeth Eurgubian and Senior Director of Advocacy and Counsel Mitria Wilson met with new NCUA board member Todd Harper to welcome him to the board and discuss credit union priorities. Harper was nominated by President Donald Trump in January and was confirmed in March, along with NCUA Chairman Rodney Hood.
“We thank board member Harper for his time and attention during our discussion about issues that are important to credit unions, most notably reducing the regulatory burden to increase member services,” Nussle said. “CUNA is pleased with the direction the agency has taken over the past few years, and we believe with a full board in place NCUA can continue its work and build on this positive momentum.”
The Wisconsin Supreme Court issued a ruling that affirmed the appeal court’s decision, concluding that “a creditor's failure to provide such notice does not constitute a sufficient basis for relief under ch. 427.”
In December 2018, CUNA and the Wisconsin Credit Union League (WCUL) filed an amicus brief in the Wisconsin Supreme Court in support of the defendant creditor as to “whether a debtor who has been sued on a consumer credit transaction without first receiving a notice of right to cure default under ch. 425 may sue the creditor for damages under ch. 427, the Wisconsin Consumer Act ("WCA").” The court of appeals concluded the debtor could not maintain such an action, and the debtor appealed. The amicus from CUNA and WCUL urged the Court to uphold the appeal court’s ruling.
CUNA filed a letter in support of NCUA’s proposed rule on supervisory committee audits (Part 715), as we believe the proposed changes would make compliance with these requirements less burdensome. Specifically, the proposal would amend NCUA’s regulations governing the responsibilities of a federally insured credit union to obtain an annual supervisory committee audit of the credit union.
The CFPB issued a release announcing changes its policies related to Civil Investigative Demands (CIDs). The amended policy is designed to ensure more information is provided by the CFPB at the onset about the potentially wrongful conduct under investigation.
The updated policy for CIDs “will provide more information about the potentially applicable provisions of law that may have been violated.” In addition, CIDs will also specify the business activities subject to the Bureau’s authority.
CFPB Director Kathy Kraninger announced the launch of a new symposium series that will be focused on issues affecting the consumer financial services marketplace. The events are intended to “stimulating a proactive and transparent dialogue to assist the Bureau in its policy development process, including possible future rulemakings.”
During each symposium, the Bureau will host a discussion panel of experts with a variety of viewpoints on the issue. The first topic for the symposia series – details of which are forthcoming – will be centered on “clarifying the meaning of abusive acts or practices under Section 1031 of the Dodd-Frank Act.”
Future symposia are planned to address other regulatory hot topics, including abusive acts or practices, behavioral law and economics, small business loan data collection, disparate impact and the Equal Credit Opportunity Act, cost-benefit analysis, and consumer authorized financial data sharing.
America’s credit unions were represented at this week’s Opportunity Zone Conference at the White House, an event featuring cabinet and other officials, along with state, local, tribal and community leaders. The Opportunity Zone program, created by the Tax Cuts and Jobs Act of 2017, encourages individuals and businesses to invest in 8,760 low-income communities designated “Opportunity Zones.”
President Donald Trump spoke at the event, calling Opportunity Zones a “crucial part of new tax law to invest and create jobs in the nation’s most underserved communities.”
Several administration officials also spoke, including Secretary of Housing and Urban Development Ben Carson and Treasury Secretary Steven Mnuchin.
The Treasury also released new Opportunity Zone guidance designed to provide flexibility for investors and funds that invest in the zones, as well as certainty for stakeholders.
CUNA represented America’s credit unions at the Bipartisan Policy Center for CFPB Director Kathy Kraninger’s first policy speech. In her speech, the Director said the Bureau will focus on “prevention of harm to consumers.” Additionally, the Bureau will work to level the playing field for financial services providers while holding bad actors accountable, and it will work to develop clear rules of the road for regulated financial entities.
“We are encouraged by the approach that Director Kraninger laid out today as well as her engagement with credit unions in the first few months of her term,” said CUNA Chief Advocacy Officer Ryan Donovan. “We look forward to engaging her more in an effort to reduce regulatory burden and put an end to one-size-fits-all regulation.”
In his opening remarks, new NCUA Chairman Hood commented on several areas he intends to focus on, including enhancing the credit union charter, enhancing cybersecurity efforts, and reducing regulatory burden
CUNA attended oral arguments before a three-judge panel of the D.C. Circuit Court of the in American Bankers Association’s ongoing legal challenge to the National Credit Union Administration’s field of membership (FOM) rule.
During the hearing, the judges considered NCUA’s appeal of District Judge Dabney Friedrich’s ruling overturning the provisions of the agency’s rule related to combined statistical areas and rural districts. Meanwhile, the Court also considered ABA’s cross-appeal on those portions of Friedrich’s opinion upholding the provision of the rule permitting credit unions to serve core-based statistical areas without serving the urban core that defines the area.
CUNA wrote to Senators Merkely and Gardner in support of the Secure and Fair Enforcement (SAFE) Banking Act of 2019. If enacted, this legislation would permit credit unions in states where marijuana is legal to safely serve their members' related needs.
As stated in the letter, CUNA takes no position on the morality or wisdom of legalizing or decriminalizing medicinal or recreational cannabis at either the state or federal level. However, credit unions operating in states where it is legal have members and member businesses involved in the cannabis market who need access to traditional depository and lending services, the absence of which creates a significant public safety issue.
CUNA wrote to Chairwoman Waters and Ranking Member McHenry prior to the House Financial Services Committee hearing with executives from seven megabanks. In the letter, CUNA highlighted the credit union difference and that even as Megabanks continue to grow as credit unions work to provide access to affordable financial services to 115 million Americans.
The letter noted that S. 2155, the Economic Growth, Regulatory Relief and Consumer Protection Act has alleviated some of those burdens, but that additional legislation that may be forthcoming should not be one-size-fits-all and recognizes the regulatory challenges and financial burden faced by smaller, less complex financial institutions.
CUNA wrote to Representatives Vicente Gonzalez (D-TX), Tulsi Gabbard (D-HI), Paul Cook (R-CA) and Don Young (R-AK) in support of their bipartisan bill that would exempt loans made to veterans from counting against a credit union’s member business lending cap.
This bipartisan legislation will make it easier for America’s veterans to access capital and invest in themselves and their communities. Credit unions proudly serve tens of millions of active duty and veteran members and fully support veteran entrepreneurs and their families.
CUNA wrote to Representative Joyce Beatty (D-OH) in the House and Senator Jack Reed (D-RI) and Tim Scott (R-SC) in the Senate to in support of their resolutions to recognize Financial Literacy Month.
The resolutions recognize the need for financial literacy as a way to empower individuals and increase economic activity and growth while calling on consumers and organizations to “observe Financial Literacy Month with appropriate programs and activities.”
CUNA staff attended a roundtable hosted by the Small Business Administration (SBA), Office of Advocacy to discuss the Department of Labor’s (DOL) proposed Overtime Rule under the Fair Labor Standards Act (FLSA). During the meeting, CUNA raised concerns about the raised threshold and the impact increased compliance costs could have on credit unions’ ability to serve their members.
The DOL’s proposal would increase the minimum salary for the “white collar” overtime exemption from $23,660 annually to $35,308 annually. The proposed threshold is lower than the threshold of $47,476 finalized in a 2016 rulemaking. The 2016 rulemaking never became effective due to federal court challenges of the rule’s legality.
Given that more than 90% of mergers in 2018 occurred at credit unions under $100 million in assets, the CUNA Small Credit Union Committee wrote to Larry Fazio, NCUA director of the office of examination and insurance, to ask whether the agency has any concerns over the continued loss of small credit unions nationwide.
Following its in-person meeting with Fazio during CUNA’s Governmental Affairs Conference, the group, which tracks issues facing small credit unions and advises the CUNA Board, wrote a letter reiterating the concerns it shared with Fazio in Washington, D.C.
CUNA wrote to Chairman Meeks and Ranking Member Leutkemeyer prior to the House Financial Services Subcommittee hearing on “The Community Reinvestment Act: Assessing the Law’s Impact on Discrimination and Redlining.
As Congress ponders ways to improve the Community Reinvestment Act’s (CRA) impact on redlining and discrimination CUNA urged the Committee to consider ways to strengthen partnerships between banks and credit unions.“Credit unions have a track record of fairly meeting the needs of all members-regardless of their race, gender, or socio-economic background,” the letter reads. “Thus, facilitating the partnerships between banks and credit unions can serve as an important mechanism for ensuring that the goals of the Community Reinvestment Act are reached.
Prior to hearings in the House Appropriations Committee, CUNA wrote to Subcommittee leadership raising credit union issues as the subcommittees began hearings on federal agency budget requests from the DOJ, IRS and Treasury for fiscal year 2020.
Todd Harper and Rodney Hood were officially sworn in as the newest members of the NCUA board. President Trump designated Hood as the new board chair.
The House will consider H.R. 1644, the “Save the Internet Act of 2019”; H.R. 2021, the “Investing for the People Act of 2019” (setting budget levels for the next two fiscal years); and H.R. 1957, the “Taxpayers First Act.”
The Senate is expected to consider the nomination of Daniel Domenico, of Colorado, to be United States District Judge for the District of Colorado.
CUNA wrote to both the House and Senate in support of Strengthening the Tenth Amendment Through Entrusting States (STATES) Act of 2019. If enacted, this legislation would clarify the federal treatment of marijuana where it is legal and permit credit unions in those states to serve members’ related needs. The STATES Act of 2019 was introduced by Senators Elizabeth Warren (D-MA) and Cory Gardner (R-CO) in the Senate and Representatives Earl Blumenauer (D-OR) and Dave Joyce (R-OH).
CUNA’s Chief Advocacy Officer – Ryan Donovan, wrote to Congressional offices highlighting the numerous public benefits that come with the credit union tax status. The credit union tax status is one of the best investments the government makes in its citizens.The email dispels numerous myths about the credit union tax status and points out that the status is based on credit unions’ mission and structure, which remains unchanged from the earliest days of not-for-profit financial cooperatives in America.
CUNA wrote to the House Appropriations subcommittee on Financial Services and General Government prior to its hearing on the FCC’s budget for the upcoming year. As Congress considers the budget for the Federal Communications Commission, it is imperative Congress encourage the agency to modernize implementing regulations for the Telephone Consumer Protection Act (TCPA).
Together with the bank regulators, the NCUA issued FAQs on FASB’s CECL (current expected credit loss) accounting standard. The FAQs expand on (and incorporate) previously issued FAQs.
The Financial Accounting Standards Board voted unanimously against formally issuing changes to the CECL accounting standard that would have affected how credit losses are recorded. The changes were the subject of a January roundtable at FASB’s headquarters in Norwalk, CT.
The House Ways and Means Committee passed bipartisan legislation that will have a significant impact on credit unions should it pass the Senate and be enacted into law. Among the bills passed was H.R. 1957, the “Taxpayer First Act of 2019.”
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