WASHINGTON (3/15/16)--The heads of two agencies with rules that impact credit unions directly will be testifying on Capitol Hill this week. Consumer Financial Protection Bureau (CFPB) Director Richard Cordray and U.S. Department of Labor (DOL) Secretary Thomas Perez will appear before the House Financial Services Committee and the House Committee on Education and the Workforce, respectively.
Cordray will appear as part of his semiannual report to the committee.
“Director Cordray is expected to receive sharp questions from both sides of the aisle regarding the bureau’s rulemaking and supervisory actions,” said Ryan Donovan, chief advocacy officer at the Credit Union National Association (CUNA). “In recent weeks, we have pressed Congress and the bureau with our concern that the CFPB is not using its statutory exemption authority as fully as it could. We believe Congress gave the agency broad authority to tailor its regulations to the abusers of consumers, but the bureau has been very reluctant to use it as such.”
CUNA will submit a letter for the hearing’s record, highlighting the regulatory burden and reminding legislators that when CFPB actions result in credit unions reducing or abounding service offerings, consumers are not being protected.
CUNA, the state leagues and credit unions led efforts to send a letter to Cordray Monday, signed by 329 members of Congress, calling for the bureau to protect credit unions. For more information on the letter, see “CUNA thanks 329 lawmakers for letter to CFPB on exemption authority” in today’s News Now.
Cordray’s testimony is scheduled for Wednesday, starting at 10 a.m. (ET), and will be streamed live.
Perez will testify before the House Committee on Education and the Workforce to address recent rulemakings from his agency, including the proposals on fiduciaries and overtime pay. Both proposals, could add significant regulatory burdens for credit unions if finalized in their current form.
The DOL’s rule would add brokers and advisers to the definition of "fiduciary" of an employee benefit plan. CUNA has concerns that this could potentially negatively affect credit unions that offer investment services through arrangements with third-party brokers if credit unions are swept into overly burdensome compliance rules.
CUNA has written a number of comment letters to DOL highlighting those concerns, and has reached out to the National Credit Union Administration to weigh in on the proposal as well. In addition, CUNA has supported legislation ;that would delay the rule.
Perez’s hearing is scheduled for 10 a.m. (ET) Wednesday, and will also be streamed live.