Credit unions seek ‘regulatory relief’ from new Congress
Credit unions are calling for “regulatory relief” from the new Republican-controlled Congress.
The National Association of Federal Credit Unions (NAFCU) signaled its discontent with heavy-handed regulations from the Obama administration’s top consumer financial watchdog in a letter to top lawmakers.
The Consumer Financial Protection Bureau (CFPB) should focus its regulatory efforts on large systemic banks, rather than “good actors” like federal credit unions, NAFCU President Dan Berger wrote.
“NAFCU was the only credit union trade association to oppose the Consumer Financial Protection Bureau having rulemaking authority over credit unions, Berger wrote. “Unfortunately, many of our concerns about the increased regulatory burdens that credit unions would face under the CFPB have proven true.”
The letter to Senate Majority Leader Mitch McConnell (R-Ky.), Senate Minority Leader Harry Reid (D-Nev.), House Speaker John Boehner (R-Ohio) and House Minority Leader Nancy Pelosi (D-Calif.) lays out the credit union association’s legislative priorities for the new Congress.
Chief among them was tackling “overregulation” from the Obama administration.
The NAFCU blamed the CFPB for pushing many credit unions out of business through regulations. According to Berger, the number of credit unions around the country has dropped by 21 percent, or 1,600 institutions since 2007, before the Dodd-Frank financial reform laws were passed.
“A main reason for the decline is the increasing cost and complexity of complying with the ever-increasing onslaught of regulations,” Berger wrote.
The credit unions also expressed concerns about cyber security, following recent data breaches at retail stores like Target.
Credit unions are often left on the hook for data breaches caused by “negligent” retailers who are not able to protect customers’ credit card information from being stolen, Berger pointed out.
He called for legislation that would hold retailers equally responsible for protecting customers’ data.
“Data breaches in both the private and public sectors have the ability to cause irreparable harm to consumers everywhere,” Berger wrote. “Credit unions are on the front lines assisting their members in the wake of ongoing data breaches and have a unique understanding of how detrimental such data breaches can be to all involved.
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