NCUA Shares Reminders to CUSOs of 'Permissible Activities'

Source: Shutterstock.

On Monday, the NCUA issued a Letter to Credit Unions to remind that of a final rule that went into effect more than a year ago that amended the agency’s regulation part 712 dealing with CUSOs. The rule expanded the “list of permissible activities and services for CUSOs to include originating any type of loan that a federal credit union may originate and grants the Board additional flexibility to approve permissible activities and services.”

The Letter, signed by NCUA Board Chairman Todd Harper, stated, “Given the new rule has been in effect for more than a year now, the agency has produced the enclosed guidance statement to remind credit unions of the expanded opportunities to work with CUSOs and to address some of the primary related risks. Based on a credit union’s relationship with a CUSO, whether sole owner, investor, lender or customer, the level and types of risk may vary. Credit unions also need to remain mindful of and properly address any consumer financial protection risks that CUSO-originated loans pose.”