Onsite Coverage: NCUA Proposes Tougher Regulations for CUSOs
ALEXANDRIA, Va. — CUSOs would have to submit financial reports to the NCUA and there would be limits on the investments certain credit unions can make in CUSOs, according to a proposed rule the NCUA sent out for comment on Thursday.
The agency also wants less than adequately capitalized state-chartered federally insured credit unions to get permission from their regulators before making investments in a CUSO. The proposed rule requires CUSOs to use GAAP accounting, prepare quarterly financial reports and get annual audits.
In addition, the rule would expand the definition of CUSO to include CUSO subsidiaries.
"We have our hands tied behind our backs without attaining this information," NCUA Chairman Debbie Matz said.
Board Member Gigi Hyland called it the best way to improve supervision without direct authority to examine vendors, which can only be authorized by Congress.
There is a 60-day comment period before the new rules take effect.