The House passed the CUNA-backed bill Monday that would prevent regulators from requesting termination of certain accounts without a material reason. The Financial Institution Consumer Protection Act (H.R. 2706) is consistent with CUNA’s bipartisan, pro-consumer Campaign for Common-Sense Regulation by removing barriers keeping credit unions from more effectively serving their members.
“As member-owned financial institutions serving their communities, credit unions are in the best place to decide what members can be served, not a federal regulator,” said CUNA Chief Advocacy Officer Ryan Donovan. “This common-sense piece of legislation is a reasonable approach to prevent fraud and maintain financial integrity while allowing credit unions to fully serve their members without fear of regulatory overreach.”
Specifically, H.R. 2706 specifies that a federal banking agency may not request or order a depository institution to terminate a customer account unless:
The bill was originally focused on the Department of Justice’s Operation Choke Point, an initiative CUNA had concerns was leading to consumers being locked out of the financial system.
However, CUNA and credit unions saw a victory in August when the Department of Justice announced it had ended Operation Choke Point.