As credit unions spend a disproportionate amount of resources on excessive compliance requirements, it leaves less time to focus on members.

Credit unions have seen a tremendous amount of change in the regulatory arena over the past 10 years, says Jared Ihrig, CUNA’s chief compliance officer.

“Credit unions are subject to the rules of multiple federal regulatory agencies and, often times, state supervisory authorities,” he says. “The creation of the Consumer Financial Protection Bureau [CFPB] has brought more attention to compliance.”

The agency has introduced more than 5,000 pages of regulatory changes since its formation in 2011, Ihrig says.

As burdensome as complying with these regulations may be, “it’s much less of a burden than the financial and reputation risk you can incur when compliance is disregarded,” says Tony Diaz, vice president, compliance, at $16 billion asset SchoolsFirst Federal Credit Union in Santa Ana, Calif.

As member-owned, not-for-profit financial cooperatives, credit unions pride themselves on doing what’s right for members, he adds.

“My credit union takes this mantra seriously,” Diaz says. “It’s embedded in our DNA, and it’s truly our brand differentiator. However, as a result of that member-centric philosophy, credit unions can easily forget that we are, in most instances, held to the same regulatory and legal standards as banks and other financial institutions.”

“Compliance can be burdensome, but it’s all in how you manage it,” adds Lisa Williamson, risk mitigation manager and compliance officer at $513 million asset Bayer Heritage Federal Credit Union in Proctor, W.Va. “Tools are available to assist you.”

NEXT: Meeting the challenge