CUNA: CFPB should move large CU exam authority to NCUA

May 21, 2018

The Bureau of Consumer Financial Protection should transfer examination and enforcement authority of the largest credit unions to NCUA, CUNA wrote to the bureau Monday. The letter was sent in response to a bureau request for information on its supervision program.

“CUNA supports this change as it will enable the Bureau to fully focus its examination and enforcement efforts on Wall Street banks and other abusers of consumers, while ensuring credit unions continue to be adequately supervised by the agency most proficient with its structure and operation,” the letter reads. “In addition, this change would streamline the examination and enforcement efforts for these largest credit unions, which are subject to duel examination or even triple examination for a federally insured state chartered credit union.”

If the bureau does not provide NCUA with primary examination and enforcement of consumer protection regulations for credit unions with more than $10 billion in assets, CUNA urges the bureau to work closely with NCUA and/or appropriate state regulators in its examination and enforcement of credit unions.

“At a minimum, NCUA and/or the appropriate examiner should be a partner through the examination process,” the letter reads.

CUNA also offered the following recommendations:

  • The bureau should not use a “one-size-fits-all approach to examining financial institutions under its jurisdiction. Rather, examinations should be tailored based on the structure, operation model and complexity of the financial institution. Specifically, it must recognize the difference between the not-for-profit credit union model and for-profit financial institutions;
  • The bureau should coordinate information requests for credit unions with the NCUA or the appropriate state regulator to prevent duplicative efforts and wasted resources;
  • The bureau’s Supervision and Examination Manual should be updated frequently to reflect changes in regulations and interpretations, and institutions should be notified when it is updated; and
  • The bureau should improve the efficiency of the examination process with the goal of reducing resources needed to supervise credit unions.

CUNA urged the bureau to:

  • Provide timely reports, communications, and feedback to credit unions;
  • Follow up on matters requiring attention and subsequent correlation plans in a timely manner; and
  • Provide fair, transparent and clear points of entry and procedures for appeals or dispute resolutions that can be utilized without retaliation or fear of retaliation.