A new CFPB director should expand the use of agency's exemption powers to exclude credit unions from agency rules that should be targeted at bad actors in the financial services industry, credit union trade groups say.
As CFPB Director Richard Cordray leaves office by the end of the month, the trade groups called on the agency to better target its rulemaking and enforcement. Cordray has been particularly aggressive in using the agency powers under Dodd-Frank—actions that have drawn praise from many consumer groups and condemnation among those in financial services. Trump Administration officials have been vocal in their criticism of the agency and any interim or permanent director is likely to be friendlier to business interests.
The CFPB should stop all pending rulemaking and place a freeze on finalizing new rules or implementing recently finalized rules, said CUNA Chief Advocacy Officer Ryan Donovan.
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Donovan said the agency should allow the NCUA to take the lead on examining large credit unions for compliance with consumer protection regulations.
Regulatory compliance has driven some credit unions out of business, Senior Regulatory Affairs Counsel Michael Emancipator, NAFCU's senior regulatory counsel said, in a letter to the agency commenting on its draft strategic plan.
"It is incumbent upon the CFPB to provide some degree of regulatory relief for small entities that cannot afford to comply with complex rules, and would otherwise be forced to stop offering services to members," he wrote.
Emancipator also called on the agency to provide clear guidance on how it intends to exercise its powers to act in cases of Unfair, Deceptive, or Abusive Acts or practices.
He also called on the agency to verify consumer complaints before they are made public in the agency's data base. "These complaints follow a pattern of unverified information that is given credibility by the mere fact that the CFPB is posting it on their website," he wrote.
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