NAFCU writes in support of Chairman Hensarling’s ‘Financial CHOICE Act’
WASHINGTON, DC (April 26, 2017) — National Association of Federally-Insured Credit Unions (NAFCU) President and CEO Dan Berger on Tuesday lodged the association’s support for the discussion draft of the “Financial CHOICE Act,” authored by House Financial Services Committee Chairman Jeb Hensarling, R-Texas, and the focus of a committee hearing slated for 10 a.m. Eastern today. Berger noted particularly the draft’s provisions for Durbin interchange amendment repeal and other regulatory relief credit unions would receive.
“Regulatory burden is the top challenge facing credit unions today. Reducing burdensome and unnecessary regulatory compliance costs is the only way for credit unions to thrive and continue to provide their member-owners with basic financial services and the exemplary service they need and deserve,” Berger wrote in a letter to Hensarling and committee Ranking Member Maxine Waters, D-Calif. “NAFCU believes that credit unions must have a positive regulatory environment that allows them to succeed.”
Berger notes several elements that would help create that positive environment. Key provisions include changes to mortgage rules, financial institution examination reform, revisions in Home Mortgage Disclosure Act limits and language calling for an examination of appropriate risk capital.
“The provision eliminating the Durbin interchange price cap and routing restrictions in the discussion draft is among the most significant aspects of this legislation for credit unions, and we strongly urge you to maintain it throughout the legislative process,” Berger added.
The NAFCU president, in the letter, also reiterated the association’s support for a commission structure for the CFPB. Meanwhile, he noted that the proposed CFPB reforms in the bill would provide credit unions with relief, for example, by removing the authority with respect to unfair, deceptive or abusive acts and practices (UDAAP) and shifting it back to functional regulators such as the NCUA. He also supported the draft provision to end the CFPB’s preemption over functional regulators with respect to consumer laws. He urged the committee to go even farther and to expand the CFPB’s exemption authority under Section 1022 of the Dodd-Frank Act.
Berger noted other aspects of the draft supported by NAFCU, including:
- retention of the three-member structure of the NCUA Board (though he said it’s unnecessary to bring the agency under the congressional appropriations process as the draft proposes);
- the transparency and independent oversight it brings to the NCUA in the form of budget hearings, an independent appeals process and more transparency regarding the overhead transfer rate;
- the assurance of a cost-benefit analysis for regulations to be reviewed by Congress.
Berger also noted the need to address non-bank financial services providers. “We also would hope that the discussion draft could be further clarified to ensure that there is a federal regulatory structure, whether the new CFPB/Consumer Law Enforcement Agency or not, for non-bank financial services market players that do not have a prudential regulator,” he stated.
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.