in Compliance & Regulatory
By: David Frankil, NJCUL President/CEO
That would be “Before CFPB.”
And odds are that your credit union was also born in the BC era.
Few new financial services regulatory agencies have had the fast start and wide-ranging impact of the Consumer Financial Protection Bureau (CFPB). For anyone charged with tracking and complying with their rules, the last five years probably seem like dog years.
This all came to mind this week with the Wells Fargo debacle, and the role that the CFPB played in bringing those practices to light and to an end. The CFPB vision and values statements provide the foundation upon which they acted – but what is most interesting is how consistent they are with what you’d see at a credit union:
Vision: If we achieve our mission, then we will have encouraged the development of a consumer finance marketplace
- where customers can see prices and risks up front and where they can easily make product comparisons;
- in which no one can build a business model around unfair, deceptive, or abusive practices;
- that works for American consumers, responsible providers, and the economy as a whole.
- Service - Our mission begins with service to the consumer and our country. We serve our colleagues by listening to one another and by sharing our collective knowledge and experience.
- Leadership - Fostering leadership and collaboration at all levels is at the core of our success. We believe in investing in the growth of our colleagues and in creating an organization that is accountable to the American people.
- Innovation - Our organization embraces new ideas and technology. We are focused on continuously improving, learning, and pushing ourselves to be great.
From our perspective, CFPB regulations often seem like they have the perverse effect of making it more difficult for us to meet member needs, in a manner consistent with our values and vision. You have to wonder how such familiar-sounding vision and values statements can lead to widely divergent outcomes. As they say, the devil is in the details.
Most recently we’ve seen either new examination results or regulations for Home-Secured Loans; Fair Lending; Unfair, Deceptive or Abusive Acts; all of which require significant compliance activities on the part of credit unions. But even more daunting is the list of focus areas for 2016-2017 that represent
1. Supervisory exams concentrating on:
a. consumer reporting obligations
b. debt collection practices,
c. remittances practices
d. complying with existing mortgage rules
e. student loan servicing, and
f. Fair Lending
2. Potential new regulations, including:
a. Small dollar loans
c. Prepaid accounts
d. Mortgage servicing
e. Home Mortgage Disclosure Act
f. Debt Collection
h. Small business lending
So how can a credit union keep track of new developments in CFPB regulations? Some resources at your disposal include:
- Our own Nicola Foggie and her Shared Compliance Program.
- Starting in 2017, look for free monthly compliance call-ins for NJCUL members on a wide range of compliance topics, including the CFPB.
- CUNA has an excellent compliance team, too: www.cuna.org/compliance.
- CUNA Mutual Group ‘s Theresa Reinke, CMG Regulatory Compliance Manager, is speaking at our Annual Convention on “The World According to the CFPB.” If you can’t be in Atlantic City to hear Theresa first-hand, contact us for a copy of her presentation after the conference.
- Right to the source at the CFPB web site at www.consumerfinance.gov.
If your credit union is facing a specific compliance challenge or concern, you can also email our Compliance Helpline directly at email@example.com and a member of our compliance team will provide assistance.