Fryzel Confirmed for NCUA Spot
WASHINGTON -- With little fanfare, the Senate confirmed Michael E. Fryzel to a seat on the NCUA Board.
Fryzel, a former director of the Illinois Department of Financial Institutions, will serve on the board through 2013. He will succeed Chairman JoAnn Johnson, whose term expired last year.
He was confirmed on a voice vote with a group of other nominees on June 27, the day the Senate left for its July 4th recess.
The Bush administration has said it will designate Fryzel as the board's chairman. A new president could designate his or her own chairman although Fryzel would remain on the board.
"I am deeply honored by my U.S. Senate confirmation. In preparing to assume office, I want to reiterate the priorities stated during my recent Senate Banking hearing: vigilant and thorough supervision, emphasis on safety and soundness and dedication to protecting the consumer," Fryzel said in a statement. "The credit union industry, now entering its second century, has proven itself valuable to America's consumers and as such has a right to expect fair, consistent, common-sense regulation. It is my commitment to conduct my chairmanship in that manner."
Fryzel has had extensive experience dealing with credit unions both while in government and in private practice, since leaving state government in 1989. He has represented numerous state and federal chartered credit unions and was the legal counsel for the Midwest Association of Credit Unions before it merged with the Illinois Credit Union League.
No date has been set for his swearing in. He was first nominated to the post by President Bush last Nov. 30.
SEC Takes Apart Broker, Mutual Fund Data Disclosure Process
WASHINGTON -- To partly mark its 75th anniversary, the SEC has kicked off a wide-ranging effort aimed at examining fundamental questions about the way it acquires information from public companies, mutual funds, brokers and other regulated entities and the way it makes that information available to investors and the markets.
"The 21st Century Disclosure Initiative" internal study will include a review of all existing SEC forms and reporting requirements, as well as the manner in which information is provided to the commission, with a special focus on "needless redundancy," the SEC said in a June 24 statement.
Consideration of various alternative strategic approaches to acquiring and publishing disclosure information will be included. And ways that regulatory requirements for the collection of information might be tailored to get the best real time distribution of financial and narrative disclosure to investors will also be researched. The initiative will examine how best to integrate public disclosure with the SEC's proposed new post-EDGAR architecture for investor search, assembly and comparison of data.
The SEC said a blueprint for future commission action to improve the usefulness and timeliness of disclosure for investors and to streamline and modernize the collection of disclosure from companies and regulated entities is scheduled to come by the end of 2008. A follow-on advisory committee will then be appointed to consider the questions in more detailed fashion through a public and consultative process.
"On the 75th anniversary of the SEC, with so much new technology available to improve the quality of information for investors as well as the way investors acquire it, we're initiating a broad, introspective look at our business model," said SEC Chairman Christopher Cox. "What hasn't changed in 75 years is the importance of full disclosure-- sunlight remains the best disinfectant for problems in our capital markets. We'll be examining how to improve the way disclosure works, including tapping the full potential of today's technology and integrating it seamlessly into our regulatory approach. That could mean fewer confusing forms and more useful information at investors' fingertips in a form they can really use."
IRS Offers HSA Guidance
WASHINGTON -- Employers and consultants have Health Savings Account questions and the Treasury Department and IRS have answers.
The Treasury and IRS has released a new set of formal questions and answers on HSAs.
Notice 2008-59 contains over 40 new frequently asked questions and answers that cover a wide range of topics, including who is eligible; issues related to high-deductible plans; contributions; distributions; and establishing an HSA.
Once of the issues the guidance makes clear is that employers who erroneously make contributions to an HSA on behalf of employees not eligible for HSAs can request that the financial institution holding the money return it. Funds not recovered by the end of the tax year must be included as wages on an employee's W-2 form for the year in which the contributions were made.
Since HSAs were created as part of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, the Treasury and the IRS has provided answers to numerous HSA--related questions raised by employers.
NAFCU Urges Leeway on NCUA Logo
ARLINGTON, Va. -- Federally insured credit unions should only be required to include a small reference to their insured status in advertisements, NAFCU told NCUA.
The trade association praised the agency's proposal to simplify advertising rules and reduce the size of or eliminate altogether the official insurance sign used in advertisements by credit unions. Instead, credit unions should have the option to just state that they are "NCUA Insured" or "Insured by NCUA."
Greater flexibility will allow these credit unions "to better meet cost needs" and "meet design challenges that may be presented by the disclosure requirement," wrote NAFCU Senior Vice President of Government Affairs B. Dan Berger.
NCUA to Sponsor Symposium
ALEXANDRIA, Va. -- NCUA will mark next year's 75th anniversary of the measure creating the federal credit union system with two days of discussions on the current and future conditions of credit unions.
NCUA Board Member Gigi Hyland will facilitate the symposium, which will cover topics such as the current financial marketplace, the importance of federal deposit insurance, opportunities for credit unions to serve all parts of their field of membership and opportunities for modernizing the Federal Credit Union Act. It will feature representatives from the credit union industry and other interested parties.
Details of time, place and speakers will be announced later this year.
"The purpose of this effort is to bring together a wide variety of representatives from all sectors of the credit union industry, as well as other interested parties, to hold a wide-ranging and frank discussion to determine whether there is a consensus on the vision for credit unions for the next several decades and beyond," Hyland said.
President Franklin D. Roosevelt signed the Federal Credit Union Act on June 25, 1934.
NAFCU Urges Consistent Definitions
On What Constitutes Low Income
ARLINGTON, Va. -- The NCUA's proposal to use median family income to evaluate if a credit union should be designated as low income provides "regulatory consistency," NAFCU wrote NCUA.
Using MFI, rather than the existing standard of median household income, would eliminate the confusion associated with adjusting the MHI for areas with a higher cost of living, according to a letter from NAFCU Associate Director of Regulatory Affairs Pamela Yu.
She added that the change would "better align the qualification standards" for the addition of underserved areas to a federal credit union's field of membership and to community development financial institution certification requirements.
Yu took issue with NCUA's proposal that after the new standard is implemented, those low-income credit unions that lose their designation should have no right of appeal.
NAFCU agreed with the proposal to grandfather all LICUs in for five years once the median family income is used as the standard of measurement. But if NCUA concludes that a credit union no longer meets the requirement for LICU after five years, an appeal should be allowed because it would "more fully alleviate any adverse effect on existing LICUs."
The trade association concluded that any change to the low-income definition "should be to better enable more--not less--credit unions to serve low-income and underserved families and communities."
The NCUA proposed the rules change after its outreach task force came up with recommendations to help the agency encourage credit unions do more to serve the underserved. The task force was the result of criticisms of credit unions performance in this area by the Government Accountability Office, Congress' investigative arm.