National Credit Union Administration Summary: Agencies Issue Exemption Order to Customer Identification Program (CIP) Requirements
NASCUS Legislative and Regulatory Affairs Department
June 2025
On June 27, 2025, the FDIC, OCC, and the NCUA (Agencies), with the concurrence of FinCEN, issued an order granting an exemption from a requirement of the Customer Identification Program (CIP) Rule implemented under Section 326 of the USA PATRIOT Act.
The order applies to “banks”, as defined in 31 CFR §1010.100(d) and their subsidiaries, which are subject to the jurisdiction of the OCC, Federal Reserve, FDIC, or NCUA. The definition of “bank” under this section includes “credit unions organized under the law of any State or of the United States.”
Background
In March 2024, FinCEN, in consultation with staff at the Agencies, issued a Request for Information (RFI) seeking information on CIP requirements to understand the potential risks and benefits, as well as safeguards, that could be established, if banks were permitted to obtain part or all of a customer’s TIN information from a third-party source before opening an account rather than from the customer.
After considering both comments submitted in response to the RFI and the advances made in identity verification tools available to banks and credit unions, FinCEN and the Agencies are granting this exemption from one aspect of the CIP TIN collection requirements.
Summary of Order
The order permits credit unions to use TIN information obtained from a third-party rather than from the member, if the credit union otherwise complies with the CIP Rule, which requires written procedures that:
- Enable the credit union to obtain TIN information before opening an account;
- Are based on the credit union’s assessment of the relevant risks; and
- Are risk-based to verify the identity of each customer to the extent reasonable and practicable, enabling the credit union to form a reasonable belief that it knows the true identity of each member.
FinCEN, the administrator of the BSA, agrees that the use of an alternative collection method to obtain TIN information, when used appropriately, is consistent with the purposes of the BSA. Furthermore, the Agencies, together with FinCEN, believe the appropriate use of alternative collection methods for TIN information is consistent with safe and sound banking practices.
The Agencies emphasize that this exemption is not required, and FIs may continue to collect TIN information directly from the customer at the time of account opening. Additionally, this exemption does not change the overall purpose of the CIP Rule. Credit unions must still implement a CIP Program that includes risk-based verification procedures that enable the credit union to form a reasonable belief that it knows the true identity of its members. These requirements exist regardless of whether the credit union establishes this relationship directly with the customer or through an intermediary.
CFPB Summary: Procedure Relating to Rulemaking Rescission
12 CFR Part 1074
June 2025
The CFPB is adopting a final procedural rule that rescinds its rule specifying how the Bureau issues rules and when rules are considered issued.
The final rule is effective as of June 18, 2025 and can be found here.
Summary
The Bureau is rescinding a rule and regulations it adopted on December 28, 2012. That rule established that a Bureau rule is deemed to be issued upon the earlier of (i) when the final rule is posted on the Bureau’s website or (ii) when the final rule is published in the Federal Register.
The Bureau is exercising its discretion to rescind the 2012 Rule because the Bureau has reconsidered the necessity of deeming a rule as final based on its posting to the Bureau’s website. The Bureau is deciding to revert to the traditional mechanism for determining when a rule has been validly promulgated, which is publication in the Federal Register. The notice classifies the final rule as procedural and having no substantive impact. As a result, the final rule is effective upon publication in the Federal Register.
CFPB Summary Consumer Financial Civil Penalty Fund Amendment
12 CFR Part 1075
Docket No. CFPB-2025-0021
The CFPB is proposing to amend its 2013 rule implementing the provision of the Consumer Financial Protection Act of 2010 (CFPA) that establishes a Consumer Financial Civil Penalty Fund (Civil Penalty Fund). The Bureau’s 2013 rule provides for the use of these funds for payments to victims of activities subject to civil penalties or (under certain circumstances) to fund the Bureau’s consumer education and financial literacy programs.
Comments on the proposed rule must be received by July 18, 2025. The proposal can be found here.
Summary
Section 1017(d)(1) of the CFPA establishes a separate fund in the Federal Reserve, the “Consumer Financial Civil Penalty Fund,” into which the Bureau deposits civil penalties it collects from judicial or administrative actions in accordance with Federal consumer financial laws. Under the Act, amounts in the fund may be used for payments to the victims of the activities for which civil penalties have been imposed under the Federal consumer financial laws. In addition, the Act provides that money in the Fund may be used for consumer education and financial literacy programs under certain circumstances.
In May 2013, the Bureau published a rule that stated its interpretation of what kinds of payments to victims are appropriate and established procedures for allocating such funds to both victims and to consumer education and financial literacy programs. The Bureau is now proposing to revise its 2013 rule articulating procedures for allocations from the Civil Penalty Fund to rescind procedures related to allocations for consumer education and financial literacy programs. The Bureau now believes that the procedures outlines in the rule provide neither adequate guardrails for the agency’s exercise of its discretion nor adequate transparency to the public regarding a potentially significant expenditure.
As a result, the Bureau proposes to rescind those aspects of the 2013 Rule that reference the Bureau’s use of amounts in the Fund for consumer education and financial literacy programs. The Bureau became effective when published in the Federal Register on June 18, 2025.
NASCUS Summary
National Credit Union Administration: 2025 Regulatory Review
NASCUS Legislative and Regulatory Affairs Department
June 2, 2025
The NCUA maintains a rolling schedule that identifies one-third of the agency’s existing regulations for review each year and provides industry stakeholders with the opportunity to comment.
NCUA’s 2025 Regulatory Review can be found here.
Comments on the review are due to the NCUA by July 25, 2025.
Comments may be e-mailed to [email protected] or mailed to Regulatory Review (2025), Office of General Counsel, National Credit Union Administration, 1775 Duke Street, Alexandria, VA, 22314-3428.
The following regulations are under review for 2025:
- 700 Definitions
Includes definitions of frequently used terms throughout this section.
- 701.1 Federal Credit Union Chartering, Field of Membership Modifications, and Conversions
This section directs NCUA policies concerning chartering, field of membership modifications, and conversions to the Chartering and Field of Membership manual found in appendix B of this part.
- 701.2 Federal Credit Union Bylaws
Part 701.2 applies to Federal Credit Unions, requiring federal credit unions to operate in accordance with their approved bylaws.
- 701.3 Member Inspection of Credit Union Books, Records, and Minutes
Part 701.3 governs when and how members of federal credit unions can inspect certain records of their credit union.
- 701.4 General Authorities and Duties of Federal Credit Union Directors
Part 701.4 outlines the fiduciary duties and responsibilities of the board of directors of a federally chartered credit union.
Note – 701.5 is currently “reserved” for Succession Planning Final Rule, which is currently open for comment until June 23, 2025, as part of the White House memorandum “Regulatory Freeze Pending Review.” Should this become effective as initially published, it would also apply to FISCUs.
- 701.6 Fees Paid by Federal Credit Unions
Part 701.6 covers the operating fees that federally chartered credit unions are assessed annually by the NCUA.
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- 701.14 Change in Official or Senior Executive Officer in Credit Unions that are Newly Chartered or are in Troubled Condition
Part 701.14 applies to FISCUs by way of reference in §741.205. The rule sets forth conditions under which a credit union must notify NCUA in writing of any proposed changes in its board of directors, committee members, or senior executive staff. The regulation only applies in the case of newly chartered credit unions and credit unions in troubled condition.
- 701.19 Benefits of Employees of Federal Credit Unions
Part 701.19 permits a federal credit union to provide employee benefits, including retirement benefits, to its employees and officers.
- 701.20 Suretyship and Guaranty
Part 701.20 authorizes a federal credit union to enter into a suretyship or guaranty agreement as an incidental powers activity.
- 701.21 Loans to Members and Lines of Credit to Members
Part 701.21 applies to FISCUs by way of reference in §741.203. The rule authorizes federal credit unions to make loans to members and issue lines of credit to members. Certain provisions apply to loans made by FISCUs.
- 701.22 Loan Participations
Part 701.22 applies to FISCUs by way of reference in §741.225. This section establishes the requirements a federally insured credit union must meet to purchase a participation loan.
- 701.23 Purchase, Sale, and Pledge of Eligible Obligations
Part 701.23 governs a Federal credit union’s purchase, sale, or pledge of all or part of a loan to one of its members, subject to certain exceptions.
- 701.24 Refund of Interest
Part 701.24 grants a Federal credit union’s board of directors the authority to authorize an interest refund to members who paid interest to the credit union during any dividend period and who are members of record at the close of business on the last day of the dividend period.
- 701.25 Loans to Credit Unions
Part 701.25 applies to FISCUs by way of reference in §741.227. This rule authorizes credit unions to make loans, including investments in Subordinated Debt, to other credit unions, including corporate credit unions. This rule also includes policy requirements
- 701.26 Credit Union Service Contracts
Part 701.26 permits a Federal credit union to act as a representative of and enter into contractual agreements with one or more credit unions or other organizations to share, utilize, rent, lease, purchase, sell, and/or joint ownership of fixed assets or engage in activities and/or services related to the daily operations of the credit unions.
- 701.30 Services for Nonmembers Within the Field of Membership
Part 701.30 permits Federal credit unions to provide certain services to nonmembers.
- 701.31 Nondiscrimination Requirements
Part 701.31 prohibits a Federal credit union from discriminating against an applicant in an appraisal, real estate transaction, or advertising of a real-estate related loan on the basis of race, color, religion, national origin, sex, handicap, or familial status.
- 701.32 Payment on Shares by Public Units and Nonmembers
Part 701.32 permits a Federal credit union, to the extent permitted under Section 107(6) of the FCUA and this section, to receive payments on shares from public units, political subdivisions, and non-member credit unions, and establishes limits.
- 701.33 Reimbursement, Insurance, and Indemnification of Officials and Employees
Part 701.33 details the requirements for Federal credit unions regarding reimbursement, insurance, and indemnification of their officials and employees.
- 701.34 Designation of Low-Income Status
Part 701.34 applies to FISCUs by way of reference in §741.204. This rule provides for low-income designation status based on data obtained through examinations. FISCUs would have to seek concurrence from their state regulator and the NCUA to receive the designation.
- 701.35 Share, Share Draft, and Share Certificate Accounts
Part 701.35 permits FCUs to offer share, share draft, and share certificate accounts in accordance with section 107(6) of the FCUA.
- 701.36 Federal Credit Union Occupancy and Disposal of Acquired and Abandoned Premises
Part 701.36 interprets and implements section 107(4) of the FCUA by establishing occupancy and disposal requirements for acquired and abandoned premises and by prohibiting certain transactions.
- 701.37 Treasury Tax and Loan Depositaries; Depositaries and Financial Agents of the Government
Part 701.37 permits a Federal credit union, subject to the regulation of the US Treasury Department, to serve as a Treasury tax and loan depositary, a depositary of Federal taxes, a depositary of public money, and a financial agent of the US Government.
- 701.38 Borrowed Funds
Part 701.38 permits Federal credit unions to borrow funds from any source, provided that certain requirements are met, including a written contract and signed promissory note.
- 701.39 Statutory Lien
Part 701.39 states that a Federal credit union may enforce its statutory lien against a member’s account(s) by debiting funds in the account and applying them to the extent of any of the member’s outstanding financial obligations to the credit union.
- Appendix A to Part 701 – Federal Credit Union Bylaws
Appendix A to Part 701 details the contents and requirements for Federal credit union bylaws.
- Appendix B to Part 701 – Chartering and Field of Membership Manual
Appendix B to Part 701 details the requirements for a new credit union charter application as well as field of membership. It also includes various NCUA forms and information for each NCUA regional office.
- 702 Capital Adequacy
Part 702 applies to FISCUs by way of reference in §741.3. This rule details prompt corrective action (PCA) for federally insured credit unions by establishing framework of minimum capital requirements.
- 703 Investment and Deposit Activities
Part 703 applies to FISCUS by way of reference in §741.3 and §741.219. This rule identifies certain permissible investment and deposit activities.
- 704 Corporate Credit Unions
Part 704 applies to FISCUs by way of reference in §741.3. This rule establishes special rules for all federally insured corporate credit unions. Non-federally insured corporate credit unions must agree, by written contract, to both adhere to the requirements of this part and submit to examinations, as determined by NCUA, as a condition of receiving shares or deposits from federally insured credit unions. This part grants certain additional authorities to federal corporate credit unions.
- 705 Community Development Revolving Loan Fund (CDRLF) Access for Credit Unions
Part 705 applies to FISCUs by way of §741.207. This part describes how NCUA makes money available to credit unions from its CDRLF.
- 707 Truth in Savings
Part 707 applies to FISCUs by way of §741.217. This part enables credit union members and potential members to make informed decisions about accounts at credit unions and requires credit unions to provide disclosures so that members and potential members can make meaningful comparisons among credit unions and depository institutions.
- 708a Bank Conversions and Mergers
Part 708(a) applies to FISCUs by way of §741.208. This part provides the requirements and authority of a credit union to convert to a mutual savings bank or a savings association without the prior approval of the NCUA, and subject to applicable law governing mutual savings banks and savings associations.
- 708b Mergers of Insured Credit Unions into Other Credit Unions; Voluntary Termination or Conversion of Insured Status
Part 708(b) applies to FISCUs by way of §741.208. This part prescribes the procedures for mergers of credit unions as well as conversions.
- 709 Involuntary Liquidation of Federal Credit Unions and Adjudication of Creditor Claims Involving Federally Insured Credit Unions in Liquidation
Part 709 applies to FISCUs by way of §741.218. This part applies to charter revocations, involuntary liquidations and adjudication of creditor claims in all cases involving federally insured credit unions and the treatment by the Board as conservator or liquidating agent.
- 710 Voluntary Liquidation
This part describes the requirements that must be followed to accomplish the voluntary liquidation of a federal credit union. FISCUs are only subject to the notification requirement provided in 710.9, and voluntary liquidation is to be accomplished by state law or procedures established by the state regulatory authority.
NASCUS Summary re: CFPB Notice and Request for Comments re: Extension of the Consumer Complaint Intake System Company Portal Boarding Form”
Docket No. CFPB-2025-0027
The CFPB requests public comment related to the Office of Management and Budget’s (OMB) extension of the existing information collection titled “Consumer Complaint Intake System Company Portal Boarding Form.”
Comments are due by July 21, 2025 and the notice can be found here.
Summary
Section 1013 of Dodd-Frank requires the CFPB to “facilitate the centralized collection of, monitoring of, and response to consumer complaints regarding consumer financial products or services.” In furtherance of its statutory mandate, the CFPB uses a Consumer Complaint Intake System Company Portal Boarding Form to sign up companies for access to the secure web-based Company Portal. The portal allows companies to view and respond to complaints submitted to the CFPB, supports the efficient routing of consumer complaints to companies and enables a timely and secure response by companies to the CFPB and consumers.
Request for Comments
The Bureau is requesting comments on the following:
- Whether the collection of information is necessary for the proper performance of the functions of the CFPB, including whether the information will have practical utility;
- The accuracy of the CFPB’s estimate of the burden of the collection of information, including the validity of the methods and the assumptions used;
- Ways to enhance the quality, utility, and clarity of the information to be collected; and
- Ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology.
NASCUS Summary re: Recission of Protections for Borrowers Affected by the COVID-19 Emergency under RESPA
12 CFR Part 1024
The CFPB issued an interim final rule that would rescind the protections for borrowers impacted by the COVID-19 pandemic provided for under RESPA. The CFPB is seeking comments on this interim final rule.
The Interim Final Rule becomes effective as of July 15, 2025, and comments are due by June 16, 2025. The interim final rule can be found here.
Summary
The 2021 COVID RESPA Rule adopted temporary procedural safeguards related to mortgage foreclosure, temporarily permitted mortgage servicers to offer certain loan modifications made available to borrowers experiencing a COVID-19 related hardship and finalized certain related temporary amendments to Regulation X.
The interim final rule provides two reasons for rescinding borrower protections under RESPA for those impacted by the COVID-19 emergency:
- Both the temporary additional early intervention live contact requirements and the temporary special COVID-19 loss mitigation procedural safeguards have been sunset by their own terms and the COVID-19 Public Health Emergency expired on May 11, 2023. Therefore, borrowers and servicers are no longer uses these safeguards.
- It is the policy of the Bureau to streamline regulatory requirements to reduce burdens on the American public. The Bureau has determined that, in light of the end of the COVID-19 pandemic, these regulations complicate Regulation X without commensurate benefits.
Request for Comments
The Bureau is requested interested parties to provide comment on the rescission of this rule. The comment period closes on June 16, 2025.
NASCUS Summary re: Recission of the Bureau’s Interpretative Rule on the Authority of States to Enforce the Consumer Financial Protection Act of 2010
12 CFR Chapter X
The Bureau issued a notice rescinding its May 2022 interpretative rule regarding the scope of State enforcement authority under Section 1042 of the Consumer Financial Protection Act of 2010 (CFPA). The interpretative rule published on May 26, 2022 is rescinded effective May 15, 2025.
The withdrawal notice can be found here.
Summary
The Consumer Financial Protection Act of 2010 (CFPA) recognizes that States play a significant role in overseeing the consumer financial marketplace. On May 26, 2022, the Bureau issued an interpretative rule seeking to clarify the scope of State enforcement authority under Section 1042 and related provisions of the CFPA. In that 2022 interpretative rule, the Bureau determined the following:
- Section 1042 allows states to enforce any provision of the CFPA, including Section 1036(a)(1)(A);
- The limitations on the Bureau’s authority in Section 1027 and 1029 of the CFPA do not constrain States’ enforcement authority under Section 1042; and
- Section 1042 does not restrict States from bringing concurrent enforcement actions with the Bureau.
The current CFPB leadership argues that this interpretation of a States’ enforcement authority under Section 1042 is incorrect for the reasons outlined below.
Statutory Limits on States’ Authority
Section 1042 of the CFPA generally authorizes the states to “bring a civil action or other appropriate proceeding to enforce the provisions of this title or regulations issued under this title.” The Bureau argues that the “title” referenced in that language is title X of Dodd-Frank and that state authority under Section 1042 is limited to actions to enforce the CFPA. Whereas the May 2022 interpretative rule ignores this limitation and allows States to bring an action whenever “a covered person or service provider violates any of the Federal consumer financial laws.
Preserving Limits on CFPA Enforcement Authorities
The previous interpretative rule stated that State enforcement authority under Section 1042 is not subject to the limits placed on CFPB enforcement authority under Sections 1027 and 1029 of the CFPA because these limitations are directed to the Bureau or the Bureau’s Director. The interpretative rule concluded that because Congress applied these limitations only to the Bureau, they do not extend to States exercising their enforcement authority under Section 1042.
The current CFPB leadership believes this interpretation is incorrect. The current CFPB acknowledges that Section 1027 and 1029 limit the CFPB’s enforcement authority over certain entities and there is no similar language under the CFPA that specifically limits the authority of States. However, the CFPB argues that Section 1027 and 1029 should be read to establish important limits on how the CFPA can be enforced and should be interpreted to impose those limits in conjunction with authority granted under Section 1042. The Bureau argues that if Congress intended for State enforcement authority under Section 1042 not to be subject to these limits it would have said so explicitly. As such, the CFPB rescinds the portion of the May 26, 2022 interpretative rule that takes the position that Sections 1027 and 1029 do not limit a State’s enforcement authority under Section 1042.
Aligning State Action with Statutory Limitations
The Bureau is also rescinding its prior interpretation of Section 1042 with regard to the ability of states to bring (or continue to pursue) actions even if the Bureau is pursuing a concurrent action against the same entity. The Bureau’s current leadership believes this approach is in conflict with its policy of reducing regulatory/compliance burdens and to eliminate wasteful, duplicative and unnecessary regulatory and enforcement activity. They suggests that Section 1042(b) contemplates joint (rather than concurrent) actions by States and the Bureau. The Bureau notes that this recission does not affect a State’s ability to undertake independent enforcement or regulatory action when the Bureau has not initiated its own action against an entity. (May 15, 2025)
The May 2025 meeting of the National Credit Union Administration (NCUA) Board was held with Chair Kyle Hauptman as the sole board member. The session included two primary briefings: a financial overview of the National Credit Union Share Insurance Fund (NCUSIF) and an update on the agency’s Voluntary Separation Program (VSP). Additional operational adjustments and strategic planning initiatives were also discussed.
NCUSIF Financial Overview & Performance
The financial performance of the NCUSIF for the first quarter of 2025 reflected steady improvement. The fund reported a net income of $1.2 million, marking an increase from the previous quarter. Total assets stood at $23 billion, while reserves reached $242 million, a $5 million rise compared to Q4 2024. The equity ratio as of Q4 was 1.30% and is projected to decline slightly to 1.26% by June 30, 2025, largely due to continued growth in insured shares.
No credit union failures were recorded in the first quarter. CAMELS code 3 credit unions decreased from 715 to 679, with associated assets falling by $16.1 billion to $172.6 billion. CAMELS code 4 and 5 institutions saw a modest decline from 135 to 129 credit unions, though their total assets increased by $1.8 billion to $20.3 billion. Notably, 90% of insured shares remain within CAMELS 1 and 2 rated credit unions.
The NCUA also introduced a new Share Insurance Fund Dashboard, providing interactive tools for users to access and analyze insurance fund data.
During the briefing, Board Member Hauptman inquired about the fund’s proximity to triggering an assessment and restoration plan. The CFO reported the fund is currently $1.3 billion above the threshold that would necessitate such action.
Voluntary Separation Program (VSP) Update
An update was provided on the NCUA’s Voluntary Separation Program (VSP), approved by the Board on March 21, 2025. The enrollment period ran from March 31 to May 5, 2025, with the goal of achieving a 20% reduction in workforce by the end of the year in a minimally disruptive manner. This initiative is part of a broader effort to modernize operations, improve efficiencies, and enhance service delivery while adhering to the agency’s core mission.
The agency offered two primary options under the VSP: the Non-Disciplinary Reduction in Personnel (NDRP), providing paid administrative leave through December 31, 2025, and the Voluntary Separation Incentive Payment (NVSIP), offering a $50,000 lump sum for retirement-eligible employees departing by year’s end. A total of 297 employees initially enrolled, with 40 subsequently rescinding, leaving net participation between 243 and 257, pending final rescissions. The majority, 72%, opted for the NDRP.
Participation was notably higher at the Central Office (30.7%) compared to the Regions and ONES offices (20.3%), yielding an overall participation rate of 22%. The agency anticipates a post-VSP headcount of approximately 953 employees, representing a 24.1% reduction in authorized positions and a 21.5% reduction in actual headcount from January 2025 levels.
The anticipated gross payroll and contract savings for 2026 are estimated at $75 million, with net savings adjusted for ongoing costs and investments in technology and new positions necessary to support operations at a lower headcount.
Operational Adjustments and Strategic Initiatives
A hiring freeze is in effect through July 15, 2025. During this period, staffing gaps will be addressed through internal reassignments and other reassignments. Permanent selections for open positions will likely resume after the freeze lifts.
Looking forward, NCUA leadership emphasized a commitment to an orderly transition and the establishment of a streamlined agency structure focused on statutory priorities, essential functions, and customer service improvements. Plans include consolidating business units, increasing supervisor-to-employee ratios, shifting certain functions from headquarters to regional offices, and leveraging new technologies.
In protecting the Share Insurance Fund during this restructuring, department heads have been tasked with identifying processes for streamlining, delaying, or eliminating activities deemed unnecessary. The agency is prioritizing its examination program, focusing on field examinations and a risk-based focus.
Examination Program Updates
The chair also inquired about changes to the examination schedule as a result of the reductions in staff. Credit unions with assets between $1 billion and $15 billion will now be examined every 18 to 20 months. Those with assets below $1 billion will be examined on a 14-20 month cycle. Newly chartered credit unions and those with unfavorable ratings will continue on an 8 to 12-month cycle. Federally insured state-chartered credit unions will be examined as needed, in coordination with regional and state supervisory authorities. It is important to note examiners will still have the ability to begin an examination earlier if they deem necessary.
Public Engagement
Finally, Board Member Hauptman encouraged the public to review and provide feedback on the NCUA’s 2022-2026 Strategic Plan as the agency begins work on its next strategic planning cycle.
National Credit Union Administration: Simplification of Share Insurance and Succession Planning Final Rules; Solicitation of Comments
NASCUS Legislative and Regulatory Affairs Department
May 2, 2025
On January 20, 2025, the White House issued a memorandum to the Heads of Executive Departments and Agencies, captioned “Regulatory Freeze Pending Review.”
In light of this memorandum, the NCUA is soliciting public comment for 60 days on two recently published final rules that have not fully taken effect, “Simplification of Share Insurance” which was published on September 30, 2024, with a full effective date of December 1, 2026; and “Succession Planning” with a full effective date of January 1, 2026.
The memorandum directs the agencies to “consider opening a comment period to allow interested parties to provide comments about the issues of fact, law, and policy raised by the rules,” that have not yet taken effect, and to “consider reevaluating pending petitions involving such rules.”
Comments are due by June 23, 2025.
Overview of Succession Planning Final Rule:
A credit union must establish a written succession plan, approved by the board of directors, and consistent with the credit union’s size and complexity. When evaluating the plan, the NCUA will consider the size of the credit union, its complexity, and the risk of its operations.
Covered positions: The plan, at a minimum, will cover the following positions or their equivalent:
- Members of the board of directors
- Management officials and assistant management officials, defined in Appendix A if provided for in a federal credit union’s bylaws, and senior executive officers identified in §701.14(b)(2); and
- Any other personnel the board of directors deems critical given the federal credit union’s size, complexity, or risk of operations. This includes new positions that may be required due to planned changes in operations, supervisory landscape, or corporate structure.
Contents of a succession plan: The plan must contain, at a minimum, the following regarding each covered position:
- The title for each covered position and the expiration of the incumbent’s term or other anticipated vacancy date if known (e.g., incumbent’s retirement eligibility date or announced departure date).
- The credit union’s plan for permanently filling vacancies for each of the positions.
- The credit union’s strategy for recruiting candidates with the potential to assume each of the positions including how the selection and diversity of skills among the employees covered by the succession plan.
Board responsibilities: The board of directors must:
- Approve a written succession plan that meets the requirements discussed above; and
- Review, and update as necessary, the succession plan in accordance with a schedule established by the board of directors but no less than every 24 months.
NASCUS comments on the initial proposed rule can be found here.
Overview of Simplification of Share Insurance Rules Final Rule:
The final rule amendments include, (1) merging the revocable and irrevocable trust categories into one category, (2) applying a simpler common calculation method to determine insurance coverage for funds held by revocable and irrevocable trusts, and (3) eliminating certain requirements found in the current rules for revocable and irrevocable trusts.
Merger of Revocable and Irrevocable Trust Categories
The final rule amends §745.4 of the NCUA’s regulations, which currently applies only to revocable trust accounts. The amendment establishes a new “trust accounts” category that includes both revocable and irrevocable trust accounts with funds deposited at a Federally Insured Credit Union (FICU). The final rule defines funds that will be included in this category as:
- Informal revocable trust funds (e.g., payable-on-death accounts, in-trust-for accounts, and Totten trust accounts);
- Formal revocable trust funds, defined as funds held pursuant to a written revocable trust agreement under which funds pass to one or more beneficiaries upon the grantor’s death; and
- Irrevocable trust funds, e.g., funds held under an irrevocable trust established by written agreement or by statute.
The merger of the two categories eliminates §745.4(h) – (i), simplifying the amount of share insurance coverage upon the death of a formal revocable trust owner. Coverage for both irrevocable and formal revocable trusts will fall under the same category and share insurance coverage will remain the same.
NASCUS comments on the initial proposed rule can be found here.
NASUC Summary: FIN-2025-Alert001
NASCUS Legislative and Regulatory Affairs Department
April 16, 2025
On March 31, 2025, FinCEN issued an alert to financial institutions, FIN-2025-Alert001, urging them to be vigilant in identifying and reporting transactions related to cross-border smuggling of bulk cash from the United States and Mexican financial systems by Mexico-based transnational criminal organizations (TCOs). This alert highlights a specific typology that TCOs use to launder illicit proceeds generated in the US through cross-border cash movements.
This specific typology involves TCOs smuggling, laundering, and repatriating bulk cash through a process involving Mexico-based businesses to repatriate previously smuggled cash into the US via foreign and domestic armored car services (ACSs) and air transport. Once the cash reaches the US, it is then delivered by an ACS to a US financial institution, typically a depository or MSB, and either deposited into accounts owned by Mexico-based businesses or transmitted by the MSB on behalf of these businesses.
This Alert details the following:
- Provides an overview of methodologies associated with these operations.
- Highlights red flag indicators, and
- Reminds financial institutions of their reporting requirements under the Bank Secrecy Act (BSA).
The information in the Alert was developed from FinCEN’s analysis of open-source reporting, BSA reporting, and information from various law enforcement partners.
What Does Bulk Cash Smuggling Look Like?
- Smuggling of bulk cash from the US into Mexico: The first step in bulk cash smuggling involves moving illicit funds from the US into Mexico. The cash is typically packaged and concealed to avoid law enforcement scrutiny and currency reporting requirements at the border. It is typically transported on an individual’s person, in privately owned vehicles or commercial tractor-trailers. Private aircraft is even used. Once smuggled into Mexico, the cash is then delivered to businesses located near the southwest border of the US.
- Repatriation of funds – Movement of bulk cash from Mexico into the US: Second, once the bulk cash is smuggled into Mexico it is repatriated back to the US under the guise of “legitimate” Mexican business seeking to deposit USD into the US. The funds are transported back in numerous ways including:
- Air transport from Mexico to the US:
- Land-based transport from Mexico to the US: and
- Land-based transport from Canada to the US, in which funds are taken from Mexico to Canada and then transported through the US – Canadian border.
- Movement of funds from the US to Mexico: Third, after the US-based financial institution receives the funds, the customer may wire the funds to financial institutions in Mexico, or to themselves in a different account for a business they own. The funds may even be used to purchase goods in the US or other countries that are then resold in Mexico as part of a trade-based money laundering scheme.
Red Flag Indicators
This alert outlines specific red flags for financial institutions to monitor, including:
- Large cash deposits from businesses with no clear operational rationale for handling substantial cash volumes.
- Frequent cross-border cash movements that deviate from the standard business practices.
- Use of armored car services or air transport for cash shipments without a legitimate business need.
Suspicious Activity Report (SAR) Filing:
FinCEN requests that financial institutions reference this alert in SAR field 2 (Filing Institution Note to FinCEN) and the narrative by including the key term “FIN-2025-BULKCASH” and select SAR field 36(z) (Money Laundering-Other) and include the term “BULKCASH” in the text box.
This alert supports Executive Order 14157, which designates certain cartels and organizations as Foreign Terrorist Organizations and Specially Designated Global Terrorists.
Financial Crimes Enforcement Network (FinCEN): Beneficial Ownership Information Reporting Requirement Revision and Deadline
NASCUS Legislative and Regulatory Affairs Department
March 31, 2025
Background
On March 2, 2025, the Treasury Department announced it was suspending the enforcement of the Corporate Transparency Act’s (CTA) Beneficial Ownership Information (BOI) Reporting rule against U.S. citizens and domestic reporting companies. In this announcement, the Department also stated it would be issuing a proposed rulemaking to narrow the scope of the BOI rule to foreign reporting companies only.
Consistent with this announcement, on Friday, March 21, FinCEN issued an interim final rule with a request for comments.
The rule is effective March 26, 2025, with written comments due on or before May 27, 2025. FinCEN intends to issue a final rule later this year.
Summary
The March 21 interim final rule exempts US companies and US persons from BOI reporting requirements under the CTA. The interim final rule also revises the definition of “reporting company” to mean “only those entities that are formed under the laws of a foreign country and that have registered to do business in any US state or tribal jurisdiction by the filing of a document with the secretary of state or similar office (formerly known as “foreign reporting companies”).”
The interim final rule addresses two specific exemptions:
- It exempts all domestic reporting companies, and their beneficial owners, from the requirement to file initial BOI reports, or to update or correct previously filed BOI reports, by excluding domestic companies from the scope of the term “reporting company” under 31 380(c)(1)(i). Additionally, the rule adds an exemption to the list of exempted entities under 31 CFR 1010.380(c)(2) by including “any entity that is: (A) a corporation, limited liability company, or other entity; and (B) created by the filing of a document with a secretary of state or any similar office under the law of the State or Indian tribe.”
- It exempts “foreign reporting companies” and their US-person beneficial owners from the requirement to provide the BOI of any US-person beneficial owners of the foreign reporting company. Specifically, foreign reporting companies that only have U.S.-person beneficial owners will be exempt from the BOI reporting requirement.
Who isn’t exempt?
Foreign entities that meet the new definition of “reporting company” and do not qualify for an exemption from the reporting requirements must file BOI reports as follows:
- Foreign entities that were registered to do business in the US before the date of publication of the interim final rule must file BOI reports within 30 calendar days of the date of publication.
- Foreign entities that are registered to do business in the US on or after the date of publication of the interim final rule must submit BOI reports within 30 calendar days after receiving notice of the effectiveness of their registration to do business in the US.
Since only a small number of foreign companies are registered to do business in the U.S., the interim rule effectively removes the BOI reporting requirement—even for U.S. companies with foreign ownership.
CFPB Summary: Proposed Rule/Request for Comments on Harmful Data Broker Practices
12 CFR Part 1022
December 2024
The Consumer Financial Protection Bureau (CFPB) issued a proposed rule and request for comments regarding the proposal, which is designed to ensure that the Fair Credit Reporting Act’s (FCRA) protections are applied to sensitive consumer information that the FCRA was enacted to protect including information sold by data brokers.
Comments are due by April 2, 2025. The proposed rule can be found here and the FR notice regarding the extended comment period can be found here.
Summary
The CFPB proposes to implement the FCRA’s definitions of consumer report and consumer reporting agency in several respects to ensure that the FCRA’s protections apply to all data brokers that transmit the types of consumer information that Congress designed the statute to regulate. The proposal:
- Provides that data brokers that sell information about a consumer’s credit history, credit score, debt payments (including on non-credit obligations) or income or financial tier generally are consumer reporting agencies selling consumer reports, regardless of the purpose for which any specific communication is used or expected to be used:
- Provides that a communication by a consumer reporting agency of a portion of the consumer report that consists of personal identifiers such as the consumer’s name, address, or age, is a consumer report if the information was collected for the purpose of preparing a consumer report about the consumer;
- Includes provisions intended to prevent privacy harms associated with the re-identification of de-identified consumer report information;
- Provides that a communication by a consumer reporting agency of information about a consumer is a consumer report if the information is used for an FCRA-covered purpose, regardless of whether there is evidence that the consumer reporting agency knew or expected that the information would be used for such a purpose;
- Provides that an entity that otherwise meets the definition of consumer reporting agency is a consumer reporting agency if that assembles or evaluates information about consumers, including by collecting, gathering, or retaining; assessing, verifying, or validating; or contributing to or altering the content of such information.
The proposal also addresses certain aspects of the Fair Credit Reporting Act (FCRA), Section 604(a) regarding permissible purposes to furnish and obtain consumer reports. These proposals are designed to ensure that consumer reports are furnished for permissible purposes under the FCRA, and for no other reasons. For example, the proposed rule:
- Provides that a consumer reporting agency furnishes a consumer report to a person when the consumer reporting agency facilitates the person’s use of the consumer report for the person’s financial gain, even if the consumer reporting agency does not technically transfer the consumer report to the person;
- Provides that the FCRA provision that authorizes a consumer reporting agency to furnish a consumer report in accordance with the written instructions of the consumer can be used to obtain a consumer report for any reason specified by a consumer, but only if the consumer signs a separate authorization that is not hidden in fine print and that discloses certain to the consumer, including the reason for obtaining the report;
- Provides that FCRA’s permissible purpose relating to legitimate business needs for consumer reports does not authorize furnishing of consumer reports for marketing.
The proposal would not interfere with consumer reporting agencies’ ability to furnish consumer reports to either prevent fraud or verify the identity of a consumer when done in connection with a permissible purpose.
Request for Comments:
The CFPB request comment on all aspects of this proposed rule. In addition, they posed the specific questions below:
- Whether each proposed provision is sufficiently clear so that entities that would be covered under a final rule could comply, or whether clarifying revisions are needed and, if so, what they are:
- Whether additional examples regarding any of the proposed provisions would be helpful and, if so, what those examples should be:
- Any anticipated drawbacks of any of the proposed provisions, such as any unintended negative consequences for consumers or covered entities or potential conflicts with other laws, and any alternatives that would achieve the goals of the proposed rule while reducing or avoiding such consequences or conflicts;
- The anticipated benefits and costs of each proposed provision to consumers and to entities that would be covered if the proposed rule were adopted as proposed, and any alternatives that would reduce costs;
- With respect to questions 1 through 4, any considerations particular to small entities that the CFPB should consider.