Acting NCUA Chairman J. Mark McWatters is asking the CFPB to use its powers to exempt credit unions from certain agency rules, particularly mortgage reporting requirements.
In a Wednesday letter to CFPB Director Richard Cordray, McWatters also asks the agency to issue clear guidance to credit unions concerning the CFPB's use of its powers to take enforcement actions based on Unfair, Deceptive or Abusive Acts or Practices.
“Such regulatory relief would lessen the financial burden on the credit union community, thereby enhancing the capital positions of credit unions and the NCUA's efforts to ensure the safety and soundness” of the agency's share insurance fund McWatters stated in his letter.
Credit unions have long complained that the CFPB has not used its powers to exempt certain financial institutions from its rulemaking. In October, then-NCUA Chairman Rick Metsger told Cordray that the NCUA, and not the CFPB, should regulate payday lending by credit unions.
In his Thursday letter, McWatters said that many credit unions have few employees, adding that they “struggle to stay abreast of complex and evolving compliance requirements without the retention of often cost prohibitive counsel, accountants, financial advisors, and other professionals.”
McWatters asked Cordray to change the threshold for credit union reporting under the Home Mortgage Disclosure Act and to decrease the number of new data points that must be reported.
He also noted that the CFPB has not issued guidance governing its UDAAP powers and asked the agency to provide “clear, transparent guidance that is reasonable, objective and specifically tailored for the credit union community.”
The CFPB is under fire from many sides. The Trump Administration has called for as-yet unspecified changes to the agency's powers and for the CFPB to be subject to the annual appropriations process.
In the House, Financial Services Chairman Jeb Hensarling's (R-Texas) Financial CHOICE Act would greatly curtail agency powers. And the agency's structure as a bureau run by a single director who may only be removed by the president for cause is in the hands of a federal appeals court, which was scheduled to hear arguments in the case Wednesday.
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