NAFCU offers five ways to improve CFPB’s supervisory activities
WASHINGTON, DC (May 22, 2018) — National Association of Federally-Insured Credit Unions (NAFCU) Regulatory Affairs Counsel Andrew Morris sent a letter to the Consumer Financial Protection Bureau (CFPB) reiterating that no credit unions, regardless of asset size, should be included under the bureau’s supervision and examination authority.
“NAFCU believes that the Bureau’s supervision and examination authority over credit unions with more than $10 billion in total assets creates needless administrative burdens and results in a fragmented examination process,” said Morris. “As credit unions approach the $10 billion dollar threshold, compliance costs dramatically rise to accommodate the Bureau’s supervisory oversight. Furthermore, the cost of getting compliance right can be extraordinarily expensive.
“At the consumer protection level, credit unions present minimal risks, and have rightfully earned their reputation as consumer-friendly institutions dedicated to improving their members’ financial wellbeing,” Morris added.
In addition to a detailed explanation of why credit unions should not be under the CFPB’s authority, Morris suggested five changes the CFPB should consider regarding its supervisory activities, including:
- adopting more reasonable timeframes for the collection of information and documents from supervised entities prior to the start of an exam;
- promoting a more flexible exam appeals process that would provide more relief;
- assuming more reliable mechanisms for factoring complaint data into exams;
- ensuring that updates to the bureau’s Exam Manual is accompanied by Federal Register notices and official redlines; and
- favoring supervisory processes over enforcement actions, and providing entities with a more reasonable timeframe to respond to potential action and request for response letters.
Morris was responding to the CFPB’s request for information on its supervisory processes.
For full text of the letter, please click here.
The National Association of Federally-Insured Credit Unions is the only national trade association focusing exclusively on federal issues affecting the nation’s federally-insured credit unions. NAFCU membership is direct and provides credit unions with the best in federal advocacy, education and compliance assistance. For more information on NAFCU, go to www.nafcu.org or @NAFCU on Twitter.