How the CFPB really impacts credit unions in relation to mortgage lending

by. Paul Imura

The Consumer Financial Protection Bureau (CFPB) has exclusive authority to conduct examinations and require reports on a periodic basis to ensure compliance with requirements of federal consumer financial laws, obtain information regarding activities subject to such laws, review the associated compliance systems or procedures, and detect and assess associated risks to consumers of consumer financial products and services for insured credit unions that exceed $10 billion in assets.

The CFPB coordinates supervisory activities with the regulating agency of the financial entity. For credit unions, the CFPB coordinates examinations and reporting requirements with state bank regulatory authorities and the National Credit Union Association (NCUA). The CFPB coordinates supervisory action and examinations by coordinating the scheduling of examinations, conducting simultaneous examinations, sharing draft reports and allowing the receiving agency to comment on the draft report before it is made final.

For insured credit unions with total assets of $10 billion or less, the CFPB may require reports from the entity that have been provided to the NCUA or state regulators to ensure compliance with federal consumer financial law, support examination activities, and assess and detect risks to consumers. The CFPB may examine, on a sampling basis, the examinations performed by the regulator, for which the regulator provides all reports and related documentation to the CFPB.

While regulators are authorized to enforce compliance adherence for insured credit unions with total assets of $10 billion or less, when the CFPB has reason to believe there is a material violation, they may recommend appropriate action to the regulator. In this case, the regulator must provide a response to the CFPB.

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