Unhappy with the CFPB’s response to a call for regulatory relief for credit unions, NAFCU on Monday called on Congress to force the agency to exempt credit unions from the agency’s rules.
“The redundancy of oversight and overregulation by the CFPB has placed an undue burden on credit unions, which are the only low-cost and no-cost financial services options for many Americans,” NAFCU Vice President of Legislative Affairs Brad Thaler wrote in a letter to senators who had asked CFPB Director Richard Cordray for credit union relief.
Thaler’s letter is the latest volley in a series of letters among credit union trade groups, Cordray and members of Congress.
Earlier this year, 329 members of the House asked Cordray to better tailor rules for small financial institutions. That letter was followed up by a letter from 70 senators asking for the same thing. Last week, Cordray responded to the senators, saying that the CFPB takes the regulatory burden small financial institutions face seriously, in an effort to comply with the agency’s rules.
He cited several regulations in his response, as well as the advisory boards the CFPB uses to gain input from credit unions and others. The letter simply restated agency policy—something that Thaler said was inadequate.
“Unfortunately, Director Cordray’s response fell short of alleviating the concerns stated in your letter and further demonstrates the need for immediate regulatory relief for credit unions,” he wrote.
Republicans on Capitol Hill have been attempting to rein in the agency’s powers since it was established as part of Dodd Frank. House Financial Services Chairman Jeb Hensarling (R-Texas) has proposed an overhaul of the nation’s financial regulatory laws. That plan includes making the agency subject to the annual appropriations process and delaying regulations until the CFPB conducts additional studies.
In addition, House appropriators have included restrictions on the agency’s powers as part of their funding bills, but the Senate has not accepted those proposals.
