Douglas Fecher, president/CEO of the $2.45 billion Wright-Patt Credit Union told lawmakers last week to direct the Consumer Financial Protection Bureau to limit regulatory burden by using existing tools, such as the power to exempt credit unions from its rulemaking.
Fecher testified before the House TARP and Financial Services subcommittee during a hearing titled, “Credit Crunch: Is the CFPB Restricting Consumer Access to Credit?”
“We believe the bureau has more authority than it has been exercising to extend relief to credit unions and others from certain compliance responsibilities,” the leader of the Fairborn, Ohio, credit union said.
“We are very concerned that the bureau seems to be picking and choosing when to use the statutory flexibility Congress provided in the Dodd-Frank Act. It is important that Congress aggressively urge the bureau to utilize the exemption clause so that the weight of compounding regulations that are intended for abusers and the largest of financial institutions do not overburden credit unions and other smaller financial institutions,” Fecher said.
Fecher noted in his testimony that Dodd-Frank charged the CFPB with reviewing all statutes and regulations that were placed by that law under the CFPB’s jurisdiction, which Fecher said could result in hundreds of additional rule changes that credit unions could be required to address. “This is why credit unions have a significant amount of anxiety with respect to the potential impact the bureau will have on their ability to serve and lend to their members,” he said.
He added that, with due respect to the CFPB, the regulator just “doesn’t get it” regarding the burden and cost borne by credit unions due to increasing regulations. He also noted that there is a significant amount of frustration within the credit union system with respect to further rules from the CFPB in response to the financial crisis because credit unions did not cause the financial crisis. Credit unions “did not seek or receive any taxpayer bailout, and they did not engage in the type of activity that prompted the creation” of a bureau to protect consumers from abusive practices in the financial services arena, Fecher said.