ALEXANDRIA, Va. - Caught in the cross-currents of a June NCUA Board meeting that passed many initiatives acceptable to them but one considered an anathema-a forceful FCU community outreach requirement offered as part of an otherwise liberalizing set of chartering amendments proposed by the agency's FOM task force-credit union trade associations will take the familiar course of lobbying for the initiatives they like and against the one they oppose. And although they had good reason to believe that they were about to lose the battle over NCUA Board member Yolanda Wheat's proposed community action plan (see related story) June 6, they also had reason to believe that other items in the task force report as well as pre-meeting negotiations over defanging a recent privacy rule amendment on co-signers and guarantors would go their way. They did. But one of the day's pleasant surprises for them-which CUNA and NAFCU will attempt to entrench-came in the form of a precarious dissent by NCUA Board Chairman Norman D'Amours over a predatory lending research initiative by his longtime rival, Wheat. Wheat, who has opposed D'Amours on all of his community outreach initiatives over the past three years, was seeking board approval of a request for comment-based on an Office of Thrift Supervision (OTS) model-on possible predatory lending conditions/solutions existing within the CU community. And as predatory lending practices are currently the target of a major campaign by the Clinton White House, it appeared likely-despite CU trade association insistence that CUs were not part of the problem-that D'Amours would have to support Wheat on this, as he did with her counterpart community action plan. "I can think of no better way," Wheat said at the outset of her presentation, "that you could give credit unions the ability to participate on the ground floor, as all the other agencies have given their stakeholders an opportunity to participate, than this request for comment." "The request for comment, in no way, presupposes regulation...." "But after many, many years that we have been trying to highlight this issue," Wheat added, "what I would not want to see is credit unions not weighing in at the appropriate time. Because the fact is that the definition of predatory mortgage lending, the definition of predatory lending are being circulated and discussed at numerous levels. And if a credit union says, `I think a balloon payment is a legitimate part of the loan product,' and at the end of the day four other agencies decide that that's not an appropriate loan product, credit unions need to have been part of the discussion much earlier." Curiously then, Wheat started interrogating staff about other board member input into her proposal, and when several moments of awkward silence indicated that there had been little by NCUA Board member Dennis Dollar and none by D'Amours, it began to look like a second vote for Wheat's proposal was not the lead pipe cinch it once appeared to be. Dollar, of course, as a known regulatory relief advocate, opposed the Wheat proposal on the basis of it being a prelude to a possible CU predatory lending rule that is not needed for the CU community. He said the agency's 18% interest cap on FCU loans made predatory lending within the system impossible. D'Amours' position, however, had gone undivulged-if not untelegraphed by his lack of input to the Wheat proposal-right up until the moment where he had to express his concerns over predatory lending while, possibly, doling some payback to Wheat. "I do have a problem with the manner in which this is coming to us, and the process being employed here," D'Amours finally said, echoing process objections Wheat had once directed against his most recent community outreach plan. "OTS did issue an ANPR (advance notice of proposed rulemaking), but it contained a PR. This began as an ANPR without a PR...." "As such...I've reviewed the questions, and while I like where Mrs. Wheat wants to go, I don't think that this is at all the way to get there...." "It's a plan to have a conversation," D'Amours continued. "I would much more willing to support a plan of action, which this is not...." "I think this matter should be handled on an action basis....I think that this should be dealt with in a way that is an ANPR. And I would be delighted to work with members of this board to try to find a way to propose something concrete to the credit union community that they can respond to." In his last polite offering D'Amours had paraphrased Wheat in her own courteous dissents over D'Amours' rejected community outreach plans. The Wheat proposal was then tabled for an indefinite period of time to allow for the promised huddling of Wheat, D'Amours, and, possibly, Dollar in the matter. -
gmcorrigan@cutimes.com
