In his statement, Harper, who championed the overdraft and NSF fee reporting requirement, said credit union member-owners and the public deserve transparency from credit unions. He added, that the lack of transparency now make credit unions “worse than banks when it comes to fee disclosures.”

“Federally insured banks with more than $1 billion in assets began reporting these numbers in 2015,” Harper wrote. “Since then, consumers have benefitted as banks have lowered their reliance on such fees. In fact, the Consumer Financial Protection Bureau found that roughly two out of three banks with $10 billion or more in assets have eliminated NSF fees, saving consumers $2 billion annually. Yet, among credit unions with greater than $10 billion in assets, four out of five continue to charge NSF fees. That overreliance on such fees is one of the many reasons why the NCUA began collecting and publicly reporting this data on Call Reports.”

Harper continued, “But, by unilateral action by the Chairman, credit union member-owners and the public will now no longer have access to this important information. If credit unions are to live up to their statutory purpose of supporting the financial needs of ‘people of modest means’ and the credit union movement’s oft-touted ‘people-helping-people’ philosophy, then credit union member-owners should have access to this basic market information, so they can make better decisions about how and where to deposit and access their hard-earned money.

“While the NCUA will no longer publish overdraft and NSF fee income for individual credit unions on a real-time quarterly basis, the agency will instead collect the data during supervisory examinations. This approach, however, will likely shield credit union members from accessing the information through the Freedom of Information Act. Ultimately, this non-disclosure will result in financial exclusion, especially when one considers that NSF is a fee for not paying for an item.”

Under the new policy, which goes into effect with the March 31 Call Report cycle, the NCUA will collect overdraft and NSF fee data as part of the examination process, which would make it difficult for the public to retrieve the data under the Freedom of Information Act.

Harper continued, “In my view, the NCUA should restore fee transparency for overdraft and NSF fees on Call Reports. If the Chairman is unwilling to reverse course, then the overdraft and NSF fee data collected in the exam process at individual credit unions shouldn’t be shielded from public release through the Freedom of Information Act. If such data was once already public information, why now sweep it under the rug?

“The Chairman also noted that the appropriateness of overdrafts and NSF fees charged is a matter between a credit union and its member-owners. If those member-owners ultimately determine how their credit union is run, then credit union management should make their overdraft and NSF income upon member-owner request.”

During his comments about removing the overdraft and NSF fee reporting requirement at GAC last week, Hauptman said, “There is a well-intentioned movement aimed at protecting consumers from excessive fees, which is something we all support.”

Hauptman added, “However, we must also consider the unintended consequences of such policies,” he said. “In this instance, the previous data collection policy incentivized credit unions to avoid serving the needs of low-income and underserved communities. These fees can be the best option in a bad situation, saving money and protecting individuals’ credit scores. Overdraft also protects people from much higher costs imposed by their local governments.”

Harper concluded his comments, stating the “unnecessary decision” by Hauptman to remove the reporting requirement could be a problem for credit unions down the road. “Profiting from consumers’ problems will come back and bite you. America’s credit union member-owners deserve better.”