Aug. 8, 2014 – CFPB pointed to financial institutions working with Big Ten colleges and universities as an example in a blog post this week about a perceived lack of transparency about product marketing to students, action that NAFCU believes promotes unnecessary confusion about current regulatory requirements.The post addressed institutions that don’t publish on “partner” sites their contracts with institutions of higher education to market their products to students. Not all institutions publish these contracts in this manner, and they’re not required to. Banks and credit unions, however, are required to and do provide CFPB with contracts they enter into with colleges and universities to market credit cards to students. CFPB says this requirement was put in place to address the questionable practices of some providers.
NAFCU Regulatory Affairs Counsel PJ Hoffman raised concerns about the potential unintended consequences of this week’s CFPB blog post and reiterated that credit unions that market products to students do so with their student-members’ best interests in mind.“We have concerns about CFPB’s suggestion that credit unions are somehow avoiding transparency in their dealings with college students,” said Hoffman. “As the bureau well knows and has recognized publicly, credit unions take great care to ensure the best interests of their members – all of their members, including college students – in providing financial services. Additionally, credit unions that market products to students already comply with current disclosure requirements.”