WASHINGTON -- Credit unions with assets of more than $10 billion would be subject to examination and enforcement by the new consumer financial products agency housed inside the Federal Reserve, according to legislation introduced by Senate Banking Committee Chairman Christopher Dodd (D-Conn.) today.
Dodd said the new entity would be a "strong and independent consumer watchdog" that would be housed at the Fed, run by a presidential appointee and funded independently from the Fed.
All credit unions would have to comply with the rules issued by the new agency but the NCUA would handle the enforcement for institutions that have assets of $10 billion or less. The new regulator's rules could be overturned by a two-thirds vote of the newly created Systemic Risk Council, made up of the heads of several key financial regulators, though not the NCUA.
NAFCU Executive VICE President B. Dan Berger said they would push to get the threshold raised from $10 billion to $50 billion, indexed for inflation.
"We appreciate the efforts of Chairman Dodd to protect consumers, like credit unions have done since their inception, but we are urging a change at mark-up to raise the CFPA's examination and enforcement level to exclude those small depository institutions with $50 billion or less in assets. Lumping credit unions in with payday lenders and other bad actors is not the best approach, especially when the two largest credit unions serve our brave men and women in uniform," he said.