CFPB rules build hurdles for CUs' member service: CUNA to Congress
WASHINGTON (9/29/15)--Despite promises to “level the playing field,” the impact of nearly every Consumer Financial Protection Bureau (CFPB) rule to date has made it more difficult and expensive for credit unions to serve their members. That’s what CUNA wrote to U.S. House Financial Services Committee leadership Monday a comprehensive, 18-page letter sent in advance of CFPB Director Richard Cordray’s semi-annual appearance before the committee this morning.
“Many credit unions have limited or eliminated certain financial products and services traditionally provided to their members as a direct result of the CFPB’s rules,” CUNA’s letter reads. “When a CFPB rule or action results in credit unions reducing or abandoning service offerings, consumers have not been protected; they have been stripped of the key market-based consumer protection that is access to credit union services. To put it bluntly: consumers lose when the CFPB keeps credit unions from serving them.”
CUNA cited examples such as CFPB’s international remittance transfer rule, the Truth in Lending Act-Real Estate Settlement Procedures Act integrated disclosures (TRID) rule and the pending Home Mortgage Disclosure Act reporting requirements, as regulations that remove services from credit union members.
To the committee regarding the CFPB, CUNA recommended the following Congressional actions:
Enact legislation that would expand CFPB leadership to a five-person board (H.R. 1266); exclude from the points and fees calculation title insurance charges and escrowed home insurance premiums (H.R. 685); deem residential real estate mortgages made by credit unions and held in portfolio Qualified Mortgages (H.R. 1210); allow the Financial Stability Oversight Council to stay or set aside any regulation upon determination of a majority of its members (H.R. 1263); and provide a TRID safe harbor through Feb. 1, 2016 (H.R. 3192);
Expand and specify the CFPB’s exemption authority to reflect that credit unions do not engage in the consumer abuse the bureau was created to address;
Fund the CFPB through the appropriation process in order to provide an additional layer of supervision over bureau activities; and
- Enact legislation that would increase the size of the institution that the CFPB can examine to $50 billion, up from the current $10 billion.
Rep. Frank Guinta (R-N.H.), a subcommittee members, has said he will ask Cordray directly about providing a TRID safe harbor during the hearing.
The hearing is scheduled to begin at 10 a.m. (ET), and will be streamed live on the committee’s website.