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Stalled bankruptcy reform legislation, recently hot wired through a controversial "informal" House conference committee process arranged by the Republican leadership, likely will emerge with a satisfactory fix to objectionable reaffirmation provisions in the Senate version of the bill (S. 625), according to CUNA and NAFCU.
The concession, CUNA announced May 5, entails an agreement by the House informal conferees working on the Senate's draft compromise to replace-in CU reaffirmations-the problematic "income and expense" debtor statement with a simpler debtor statement acknowledging the reaffirmation.
The debtor reaffirmation statements are used in concert with attorney representation to avoid time-consuming and expensive reaffirmation judicial review hearings-a non-negotiable requirement of CU support for this bankruptcy reform effort-and the simplified statement form eliminates some of the pitfalls of the more complicated form.
At press time the House informal conference committee's draft-reportedly tangled in House Judiciary Committee input to the document-had not yet been relayed back to the Senate, but NAFCU legislative affairs Director Murray Chanow said he expected it to be submitted by May 12.
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In a rousing and well-researched speech before the Pennsylvania CUL May 5, Green Party presidential candidate and consumer advocate Ralph Nader called for bankers to commit some of their recent record profits to low-income outreach by rolling back fees and desisting from attacking the CU community.
The bankers, Nader said, were after the credit unions because CU competition represented a restraining influence on banker fee gouging.
Noting that the CU movement was the best answer to the problem of predatory lending in America, Nader contrasted the principles of cooperative finance, which he suggested counteracted predatory lending practices, and banking's fee gouging, which he said contributed to the practice. In the process Nader applauded credit union growth, the youth education work of the Pennsylvania CUL itself, and, in particular, the low-income outreach efforts of NCUA Board Chairman Norman D'Amours.
"...(he) has used his office to remind credit unions of their people-oriented legacy," Nader said of D'Amours. "He has spoken out frequently about the need to keep volunteers in the forefront of policymaking...."
"I know that Chairman D'Amours has not pleased everyone with his emphasis on volunteers and the need for credit unions to broaden efforts to reach out to low and moderate income citizens. But I think the Chairman is trying to remind credit unions that adherence to the basic principles on which this movement was built is essential to its survival. I think he is right."
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Weighing in on the increasing sore subject of the NCUA's recent impromptu amendment on co-maker privacy rights (see related story, page 1), NAFCU President Fred Becker, jr. said May 10: "NAFCU disapproves of the amendment adopted as part of the final privacy rule that now requires credit unions to provide (privacy) and opt-out notices to all co-borrowers and co-signers/guarantors of loans. Credit unions probably don't retain co-signer information in their databases, and adding that is likely to eat up significant time and resources...."
The Federal Reserve System (Fed) and the Federal Deposit Insurance Corporation (FDIC) voted in their final privacy rule, May 10, two days after NCUA's action.
Neither agency chose to follow the NCUA's lead by requiring banks to provide privacy and "opt out" notice for co-makers, co-signers, and guarantors of loans. -
gmcorrigan@mindspring.com
