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ARLINGTON, Va. – Three timely issues – federal preemption, overdraft protection, and Check 21 – were the lead topics for discussion at a recent meeting of the State Financial Regulators Roundtable (SFRR) chaired by NASCUS Government Relations Committee Chairman George Latham, deputy commissioner of Financial Institutions for Virginia. Discussions concerning overdraft protection centered around the Federal Financial Institution Examination Council’s proposed guidelines on overdraft protection, in particular added-in balances. Proper disclosure requirements and usury were also discussed. Last month, NASCUS filed a comment letter with NCUA on the proposed interagency guidance on overdraft protection. In her Aug. 6 letter to NCUA Secretary of the Board Becky Baker, NASCUS President/CEO Mary Martha Fortney commended the agencies’ efforts to publish guidance on overdraft protection programs, pointing out that state regulators “agree that such programs must be accompanied by thorough disclosures and member education programs” and some states have already issued guidance to their credit unions. “As guidance,” Fortney wrote, “the Interagency proposal does not carry the force of law and therefore does not preempt continued state efforts to establish standards for the offering of overdraft protection programs. However, the proposed guidance should make clear that the guidelines are meant to supplement any other applicable state guidelines. The proposal does make this distinction in reference to state laws, but the reference should be expanded to include all state guidelines and regulations.” According to NASCUS, the consensus of the group was that the FFIEC would likely reconsider and revise its guidelines as the debate over overdraft programs continue. Attendees also heard from Andrew Smith, an attorney for the Federal Trade Commission, who discussed the FACT Act and how it affects financial institutions. William Langford, associate director, Regulatory Policy & Programs for FinCen also spoke. He discussed the structure of FinCen and compliance and procedures concerning the Bank Secrecy Act. NASCUS VP of Regulatory Affairs Brian Knight, and EVP of Government Relations Sandra Troutman also attended the SFRR meeting, as did state financial regulators from the: American Association of Residential Mortgage Regulators; American Council of State Savings Supervisors; Conference of State Bank Supervisors; Money Transmitter Regulators Association; National Association of Consumer Credit Administrators; National Association of Insurance Commissioners; and North American Securities Administrators Association. The SFRR meets twice annually via teleconference and twice per year in-person to provide a forum for state regulators to discuss current issues, exchange ideas, and coordinate responses to issues of mutual interest. SFRR plans to meet again by teleconference after the November election. -

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