Newsroom
August 24, 2014
Crapo notes concerns with Education 'sponsored accounts' rule
Aug. 14, 2014 – Senate Banking Committee Ranking Member Mike Crapo, R-Idaho, on Wednesday told Education Secretary Arne Duncan that the department's proposed rule on college students' "sponsored accounts" may be at odds with prudential financial institution regulators' rules on consumer accounts and related protections.
Crapo is asking the department to address numerous concerns with this rulemaking before moving forward on a final rule, which reportedly is being promulgated with a 2015 effective date in mind.
The department's rule would govern certain aspects of a sponsored account, defined as any account that an enrolled student (or his or her parent) might maintain to receive funds disbursed under Title IV of the Higher Education Act. Crapo said that the definition could be read to include any basic bank account opened by a student during freshman orientation "that never receives or was intended to receive" such funds.
Crapo said this may exceed the department's statutory authority and interfere with the prudential banking regulation of students' checking accounts. Fees and disclosures related to these accounts are subject to numerous federal and state consumer protection and safety-and-soundness rules, he noted.
The senator also noted concern that the department, in working with stakeholders on a proposed rule, did not consult with any prudential banking regulator.
Crapo is asking the department to address numerous concerns with this rulemaking before moving forward on a final rule, which reportedly is being promulgated with a 2015 effective date in mind.
The department's rule would govern certain aspects of a sponsored account, defined as any account that an enrolled student (or his or her parent) might maintain to receive funds disbursed under Title IV of the Higher Education Act. Crapo said that the definition could be read to include any basic bank account opened by a student during freshman orientation "that never receives or was intended to receive" such funds.
Crapo said this may exceed the department's statutory authority and interfere with the prudential banking regulation of students' checking accounts. Fees and disclosures related to these accounts are subject to numerous federal and state consumer protection and safety-and-soundness rules, he noted.
The senator also noted concern that the department, in working with stakeholders on a proposed rule, did not consult with any prudential banking regulator.
Share This
Related Resources
Add to Calendar 2024-05-03 14:00:00 2024-05-03 14:00:00 Plan Sponsor Attitudes Toward Retirement Plan Management and Fiduciary Outsourcing About the Webinar In January 2024, Pentegra conducted a survey of retirement plan sponsors and their perspectives on retirement plan management and fiduciary outsourcing. The survey measured how sponsors are using fiduciary outsourcing to help better manage their retirement plans. It also captured their perspectives on what outsourcing does to help them better position their plans and drive improved retirement plan outcomes. Key Takeaways: What is the full scope of your responsibilities as a plan sponsor? What is fiduciary outsourcing and how does it work? How does fiduciary outsourcing help reduce workloads and minimize risk? How can a credit union best position its plan to drive improved outcomes? Register Here Web NAFCU digital@nafcu.org America/New_York public
Plan Sponsor Attitudes Toward Retirement Plan Management and Fiduciary Outsourcing
preferred partner
Pentegra
Webinar
Ensuring Safety and Soundness with AI
Management, Consumer Lending, FinTech
preferred partner
Upstart
Blog Post
Turning Lemons into Lemonade: Capitalizing in a Post-Banking Crisis Era
Strategy
preferred partner
Allied Solutions
Blog Post
Add to Calendar 2024-05-02 14:00:00 2024-05-02 14:00:00 Mastering Resilience in Incident Response Plans About the Webinar An Incident Response (IR) plan is crucial for guiding credit unions through major incidents efficiently and effectively. However, many IR plans lack resilience, making them less adaptable to the evolving threat landscape. Join us for our webinar Mastering Resilience in Incident Response Plans where DefenseStorm cyber experts Elizabeth Houser and James Bruhl will delve into the importance of resiliency within cybersecurity IR plans. Don’t miss out on the opportunity to learn how to: Ensure IR plan accessibility so that all team members with assigned roles are prepared for effective incident response. Conduct efficient and regular reviews to ensure roles and responsibilities are current, tools are relevant, and compliance requirements are met. Implement and utilize tabletops to regularly test the effectiveness of your IR plan. Enhance preparedness, efficiency, and confidence among responders. View On-Demand Web NAFCU digital@nafcu.org America/New_York public
Mastering Resilience in Incident Response Plans
preferred partner
DefenseStorm
Webinar
Get daily updates.
Subscribe to NAFCU today.