NCUA chairman seeks CFPB exam exemption for big CUs

July 6, 2017 -- Three, very large state-chartered credit unions – out of six federally insured credit unions with $10 billion or more in assets -- would receive a conditional exemption from CFPB exam and enforcement authority under a request made Thursday by NCUA Board Chairman J. Mark McWatters.

McWatters noted in the request that the state-chartered credit unions face triple examinations now, under state, federal and CFPB review.

In a letter to CFPB Director Richard Cordray, McWatters requested a “conditional exemption” for the very large credit unions to shift exam and enforcement authority from the consumer bureau to NCUA, citing “numerous benefits from the current system, in which credit unions face unnecessary examination burdens and aggressive punitive fees.

State-chartered credit unions covered under the request are BECU of Wash., State Employees Credit Union of N.C., and The Golden 1 Credit Union of Calif.

“Subjecting federally insured credit unions and their consumer/member owners to the dual examination—and, in the case of federally insured, state-chartered credit unions, triple examination—regime mandated under Section 1025 of the Consumer Financial Protection Act imposes unnecessarily burdensome costs, particularly given their positive, consumer-focused role,” he said.

He added that CFPB and the NCUA should work together, stating that, as prudential regulator of federally insured credit unions, NCUA owns a “broader arsenal of enforcement tools than is available to the CFPB, allowing the agency to take more targeted actions to protect consumers and address consumer financial protection law violations.”

LINK:
NCUA Release: Chairman McWatters Asks Director Cordray to Exempt Largest Credit Unions from CFPB’s Examination and Enforcement Authority