WASHINGTON (2/26/16)--A Dear Colleague letter addressed to the Consumer Financial Protection Bureau (CFPB) urging the agency to use its authority to protect credit unions has gained several dozen signers from House representatives--a direct result of this week’s credit union visits with legislators.
“That’s immediate impact from the visits, and we expect that number to grow in the coming days,” said Ryan Donovan, chief advocacy officer at the Credit Union National Association (CUNA).
During this week’s CUNA Governmental Affairs Conference, CUNA encouraged credit unions to address this topic, brought forth by U.S. Reps. Adam Schiff (D-Calif.) and Steve Stivers (R-Ohio).
“The California and Ohio credit union leagues have played a critical role in the development of this letter,” Donovan said. “Their leadership and support helped secure the letter's lead sponsors, which in turn helped us hit the ground with a running start this week. It is another great example of the importance of the CUNA-League system to credit unions' advocacy efforts.”
The letter to the CFPB cites the Dodd-Frank Act section in which the CFPB has “the authority to adapt regulations by allowing it to exempt ‘any class’ of entity from its rulemakings.”
“The GAO recently reviewed the impact of regulation on community lenders and found that credit unions and other small banks have reduced consumer lending products because of an increased compliance burden that may not have been intended for them," the representatives noted in their call for signers.
It adds: “With major rules already being implemented and new regulations on the horizon, our letter reminds the CFPB that Congress intentionally provided for regulatory flexibility to mitigate collateral damage on smaller financial institutions.”
The authors encourage the signing of the bipartisan letter “to help ensure continued access to financial products” by credit union members. The letter will close March 4.
During CUNA GAC, CFPB Director Richard Cordray said the CFPB is not the enemy of the financial industry, and urged credit unions and other financial institutions to stop “attacking or resisting the CFPB.”
This led to widespread media coverage, both of Cordray’s statement, and his remarks in general. Following Cordray’s CUNA GAC appearance, Housing Wire, American Banker, DSNews, National Mortgage Professional Magazine and others sparked a discussion on the implications of his remarks.