DUBLIN, Ohio -- American Share Insurance commended Congress for including a provision to update the FDIC Improvements Act disclosures in the regulatory relief bill. While FDICIA required privately insured credit unions to disclose that they are not backed by the federal government, implementing regulations and enforcement were never funded. Now that Congress has funded enforcement of the 12-year-old law and clarified authorities, some cleaning up needed to be done in keeping with the times.
"We pushed hard to get that into the bill," ASI President/CEO Dennis Adams said. Designating state regulators to examine privately insured credit unions for compliance, rather than the Federal Trade Commission as the law was originally written, was a positive, he said. "I think it's a positive thing for state regulators and state chartered credit unions to remain under their state licensing authorities."
The amendment also clarifies what advertisements require disclosures because there was some confusion over whether baseball caps and other marketing tools would require disclosures, or how to disclose on a network-owned ATM or at a shared service center.
Adams said he had no idea when the FTC would come out with a regulation. Under the new law, privately insured credit unions have until Jan. 11, 2007 to make the first disclosures to their members, he noted. It would be nice to know, he said, whether those disclosures could be included in year-end statements or newsletters. "We're trying to get some dialogue going so we [our credit unions] don't get stuck finding out two days ahead of time," Adams said.
He added that ASI has been encouraging disclosures within the spirit of the law all along and provides materials and education sessions toward that end.