America’s Credit Unions is urging the CFPB to proceed cautiously as it explores new regulations on coerced debt. In a recent comment letter responding to the Bureau’s Advance Notice of Proposed Rulemaking (ANPR), the trade group stressed the importance of protecting victims of financial abuse but warned of unintended consequences if future rules are overly prescriptive.
“America’s Credit Unions and our member credit unions share the Bureau’s concern for consumers harmed by coerced debt, including individuals who may be subject to economic abuse and fraud,” the letter stated. However, the organization emphasized that any rulemaking should not impose excessive burdens on financial institutions or interfere with current legal processes.
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Of particular concern is the possibility that credit unions could be required to independently investigate and validate claims of coerced debt. “We caution against creating additional consumer-facing procedures that would require financial institutions to serve as investigators or arbiters,” the letter read. “This is particularly important when considering how coerced debt claims often arise in the context of family law disputes.”
America’s Credit Unions also recommended that any new standards prioritize flexibility over rigid mandates. “We urge the Bureau to preserve flexibility for financial institutions to establish procedures to address coerced debt in a manner that fits the needs of their members and risk profiles.”
The letter called on the CFPB to collaborate with credit unions and victim advocacy organizations to develop effective, practical solutions. “Credit unions are committed to the well-being of their members,” the letter concluded, “and seek to support consumers affected by coerced debt through fair, compassionate and feasible procedures.”
The CFPB’s ANPR remains open for public comment as the agency considers next steps in its rulemaking process.
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Michael Ogden
Editor-in-Chief at CU Times. To connect, email at [email protected]. As Editor-in-Chief of CU Times since 2016, Michael Ogden has led the editorial team in all aspects of content strategy and execution, including the creation of the publication’s exclusive and proprietary research database of the credit union industry’s economic landscape. Under Michael’s leadership, CU Times has successfully shifted to an all-digital editorial product with new focuses on the payments, fraud, lending and regulatory beats. Most recently, he introduced a data-focused editorial product for subscribers that breaks down credit union issues into hard data, allowing for a deeper and more factual narrative for readers. In 2024, he launched the "Shared Accounts With CU Times" podcast, which offers a fresh, inside-the-newsroom perspective through interviews with leaders from the credit union industry and the regulatory world. He dives into pressing credit union issues, while revealing the personalities working behind-the-scenes to push the credit union world forward. His background includes years as a radio and TV anchor/reporter and a public relations and digital/social media manager, where he covered the food and music industries, as well as cooperatives and credit unions. Over the years, he has launched numerous exclusive video and podcast series, including a successful series of interactive backstage interviews with musicians at music festivals, showcasing his social media and live streaming production skills.
