WASHINGTON (1/14/15)--Questions arising from the passage of the Credit Union Share Insurance Fund Parity Act and a list of changed fees, thresholds caps and exemptions highlight this month's CompBlog Wrap-Up. Assembled by Credit Union National Association compliance staff, the monthly Wrap-Up features top posts from the previous months.
The December Wrap-Up examines some of the changes that come with interest on lawyer trust accounts (IOLTAs) now covered by the National Credit Union Share Insurance Fund. This became effective Dec. 19, and has been the subject of many questions sent to CUNA compliance staff.
Many questions involve what other escrow accounts will be covered by the new law. According to CUNA Chief Compliance Officer Kathy Thompson, CUNA "conveyed to [Congress] that passage would also address problems with real estate escrow accounts and prepaid funeral accounts that have to be held in a trust account."
NCUA has indicated that it will be revising its regulations to conform with the new law, and CUNA will be asking NCUA to include examples of pass-through accounts covered by the law.
Another question CUNA has received is: "How does this coverage relate to other accounts the client may have at the credit union?" Thompson refers to a 2008 letter from the NCUA to credit unions.
"NCUA says that in the event of the credit union's liquidation, for a member with money in an IOLTA-type account, his money in that account would be added to any other individual accounts he has at the credit union to determine the $250,000 insurance coverage limit," she writes. "I assume that this will continue to be NCUA's position, but we will review FDIC coverage to make sure this is comparable -- comparability is our goal so that credit unions aren't at a competitive disadvantage with banks."
Thompson also said CUNA will ask the NCUA to address whether IOLTAs will be treated as member accounts, as opposed to non-member accounts, for purposes of calculating the cap on public unit and nonmember shares.
She urged credit unions to continue feeding CUNA their questions so that they will be addressed by NCUA.
With 2015 underway, the Wrap-Up also looks at the fee caps, thresholds and exemptions that come with the calendar changing over to another new year.
This includes the ceiling on allowable charges under the Fair Credit Reporting Act, the Federal Housing Administration loan limits, the Home Mortgage Disclosure Act exemption threshold, higher-priced mortgage loans appraisal exemption amount and the Regulation Z small creditor cap.