In December 2018, the Senate confirmed Kathy Kraninger as the CFPB’s new director for a five-year term. Kraninger’s confirmation followed a year of change at the CFPB. In November 2017, former Director Richard Cordray resigned from the CFPB to enter the race for Ohio governor and named his chief of staff, Leandra English, as Deputy Director. That same day, President Trump named Mick Mulvaney, then Director of the Office of Management and Budget and current Acting White House Chief of Staff, as the Acting Director. This sparked a lawsuit by English, which she withdrew when President Trump nominated Kraninger as CFPB director.
Under Acting Director Mulvaney, the CFPB took a different approach to rulemaking and enforcement actions than under former Director Cordray. Mulvaney aggressively pursued a number of NAFCU-supported changes at the CFPB to increase its effectiveness and transparency. Director Kraninger has indicated that she plans to take a more conciliatory approach to running the agency than her predecessor. For example, she halted Mulvaney’s effort to rebrand the agency from “CFPB” to “BCFP.” However, she plans to continue many of Mulvaney’s initiatives to promote transparency and cost-benefit analysis of burdensome regulations.
2019 Regulatory Priorities
NAFCU is excited to work with Director Kraninger to ensure a healthy regulatory environment in which credit unions can grow, thrive and successfully serve their membership. NAFCU haswith Kraninger, highlighting the value of credit unions to the nation’s economy and, in particular, individuals of modest means. At a with Kraninger, NAFCU President and CEO Dan Berger discussed issues relevant to credit unions, including: implementing provisions of the NAFCU-backed Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155), reporting on Home Mortgage Disclosure Act (HMDA) data, ensuring fintech competes on a level playing field with credit unions, the CFPB’s proposed changes to its Payday Rule, and compliance with the TILA/RESPA integrated disclosure (TRID) rule. NAFCU has also urged Kraninger to more actively use the CFPB’s exemption authority to excuse credit unions from certain rulemakings.
In 2019 thus far, the CFPB has taken action on several notable rulemakings/issues, and NAFCU has actively engaged to ensure credit unions’ concerns are taken into account:
- Payday Rule: The CFPB issued proposals in February to amend and delay the 2017 Payday Rule. NAFCU supported the delay of the compliance date, and the CFPB finalized the delay in June. NAFCU also commented on the proposed amendments and met with the CFPB, asking for an exemption for all iterations of the NCUA’s payday alternative loan (PAL) program.
- Home Mortgage Disclosure: In May, the CFPB issued a proposed rule to adjust collection and reporting thresholds under HMDA, as well as an advance notice of proposed rulemaking to gather information on the costs and benefits of reporting certain data points under HMDA. NAFCU wrote in support of increased thresholds.
- Debt Collection: In May, the CFPB released a debt collection proposal and held a town hall on the issue, which NAFCU attended. NAFCU met with the CFPB in June to discuss how debt collection efforts are affected by the Telephone Consumer Protection Act (TCPA).
- QM Definition under TILA: The CFPB issued a proposal in July regarding potential revisions to the definition of qualified mortgage (QM) under the Truth in Lending Act (TILA) in light of the fact that the Temporary GSE QM loan category (“GSE Patch”) expires on January 10, 2021.
- Remittance Rule: In April, the CFPB issued a request for information on its remittance rule, which is a positive sign for the industry. NAFCU commented, reiterating long-expressed concerns with the rule’s highly burdensome compliance costs, which has resulted in many credit unions ceasing to offer remittance transfer services due to prohibitively high costs.
- Overdraft Rule: In May, the CFPB issued a request for comment on the overdraft rule as part of its compliance with the Regulatory Flexibility Act. NAFCU submitted comments, voicing support for efforts to relieve burdens on credit unions and encouraging the CFPB to objectively consider the value of overdraft services to credit union members.
- UDAAP: In June, the CFPB held a symposium, which NAFCU attended, focused on clarifying “abusive” under unfair, deceptive or abusive acts or practices (UDAAP). NAFCU has long advocated for the CFPB to issue specific guidance on prohibited practices so that financial institutions have more clarity on this issue.
- Regulatory Flexibility Act Plan: The CFPB issued a request for comment in May to get input on how it should develop plans to conduct reviews of its rules. NAFCU commented, urging the CFPB to more frequently review significant rulemakings to identify ways to reduce burdens on small entities like credit unions.
In its Fall 2018 rulemaking agenda, the CFPB indicated that implementation of S. 2155, which was signed into law on May 24, 2018, remains a priority. NAFCU has and recently met with the CFPB to discuss the costs and benefits of implementing the rule, as well as credit unions’ concerns and recommendations for more guidance.