NACUSO Ventures Into Legislative, Regulatory Advocacy Arenas
NACUSO is venturing into the thick of the legislative and regulatory brush for the first time.
NACUSO's recently released 2011 agenda outlined four priority issues.
Among them, NACUSO plans to support initiatives to expand authorized products and services CUSOs can offer and streamlining the authorization process.
NACUSO said it also supports a legislative initiative to expand member business lending. It is backing a regulatory initiative to allow CUSOs and credit unions with a proven track record in business lending to approve loans for qualified entities without a personal guarantee.
Supporting a legislative initiative to increase the statutory cap limiting CU investment authority in CUSOs is also on the agenda.
On the flip side, NACUSO said it will oppose any initiative allowing credit union regulators to directly oversee CUSOs.
"It squeezes the lifeblood out of what CUSOs have to offer. When you start heavily regulating everything, it squelches innovation," said Lisa Renner, chair of NACUSO’s legislative and regulatory advocacy committee.
The agenda is intentionally focused, "We’re not going to chase every rabbit in the field," Renner said. "We’re focused on any issue that touches on collaboration, innovation, entrepreneurialism and credit union growth."
However, should other relevant issues arise NACUSO will not hesitate to act.
One recent stance involves a provision of the Dodd-Frank Act tasking regulators with requiring disclosure of certain incentive-based compensation arrangements.
The act applies to institutions covered by federal regulations, wrote NACUSO President/CEO Jack Antonini in a comment letter. Since CUSOs are not directly supervised by the NCUA, it is not clear if the proposal applies to them, he added.
"CUSOs in general are not operating in the same business activities as the covered institutions and most should not be placed at a competitive advantage by being treated as a financial institution when much of their competition is not," Antonini said.
NACUSO said it is also concerned with the evasion provision of the proposal, which is designed to prevent financial institutions from skirting the rule. Antonini said since CUSOs are often staffed with former employees of credit unions, it may look as though the credit union is attempting to evade the proposed rule.
"…[B]ut in truth the credit unions are all simply trying to maximize the aggregate expertise of their staff to gain scale and better quality of service," Antonini wrote. NACUSO is asking CUSOs to comment on the proposed rule.