CU Trades Seek to Reshape Financial Overhaul
The ink has just dried on the Dodd-Frank financial overhaul law, but there is already talk among some about changing the legislation.
NAFCU has already written a letter to lawmakers suggesting changes, and its officials have outlined concerns during their meetings with Treasury Department officials and regulators. CUNA hasn't sent a letter to lawmakers and has no imminent plans to do so. However, its officials have also spoken with regulators about concerns over what it calls excessive regulatory burden.
Spokesmen for the Senate Banking Committee and House Financial Services Committee said there are no current plans to revisit the legislation, which President Obama signed in July.
In its letter to the top members of the House and Senate panels, NAFCU requested more transition time, an adjustment of certain thresholds for inflation and clarification of the mortgage rules.
NAFCU President/CEO Fred Becker wrote that these "corrections and clarifications" would give credit unions more time to comply and ensure that they aren't faced with unintended consequences.
Because the law creates "an overwhelming number of new compliance burdens" for credit unions, Congress should postpone the implementation date for certain provisions until the summer of 2012, Becker wrote.
He also recommended that lawmakers be more specific in instructing the Federal Reserve about what it should take into consideration when regulating interchange fees.
Becker wrote that because of inflation, more credit unions will find their assets exceeding $10 billion-which will cause them to be subject to supervision of the new consumer agency. Therefore, lawmakers should mandate that the monetary thresholds be adjusted for inflation.
Among the other changes the letter calls for are for Congress to mandate a combined mortgage rule to avoid confusion that exists about the mortgage disclosure process; clarify what access the new consumer agency has to financial reports issued by the NCUA and other regulators as part of the reexamination process; and lower the penalties for violations of the rules mandating that credit unions and other financial institutions report appraisers who violate applicable codes and laws.
Becker also suggests that lawmakers change the bill's definition of "remittance transfer," which he said it overly broad and would cause "significant compliance obstacles."
Executives at CUNA and NAFCU have both met with Elizabeth Warren, who is setting up the new Bureau of Consumer Financial Protection that was established by the law.
Both declined to characterize their conversations, although they said they made the case that they hope any new regulations are offset by reductions in the regulatory burden in other areas.
CUNA President/CEO Bill Cheney said he hopes that the regulatory policy of the new agency will include a concerted effort "to consolidate and streamline consumer protection rules."