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NAFCU, CUNA urge White House to discourage CFPB’s spotty regulation
NAFCU and CUNA joined with several financial trade associations to call on President Joe Biden to hold the CFPB accountable to the rulemaking process and offer support for “clear rules of the road” in the financial services industry.
“Markets work best when the rules are clear, so it is possible to comply with them,” wrote the groups. “Blog posts that contradict law or regulation, vague guidance that deems common practices like using form contracts or including certain terms and conditions in contracts, proclamations of the CFPB’s novel interpretation of law via amicus briefs, or enforcement actions that contradict state law, are not setting clear expectations that it is possible to follow.
“Moreover, in some instances, guidance has imposed new substantive obligations on affected parties without going through the notice-and-comment process; in these instances, such guidance is not truly ‘guidance,’ but instead operates as a substantive rule,” added the groups.
In addition, the groups noted that the CFPB fails to consider the costs and benefits of proposed regulations. These costs often fall squarely on the shoulders of American consumers, which is “contrary to the administration’s goal of reducing fees for American consumers.”
“Spotty regulation creates an unlevel playing field that discourages financial institutions from taking risks on new products that may help underserved communities and reach customers who may pose more of a risk,” concluded the organizations.
NAFCU actively advocates for reforms to the bureau and will continue to tout the credit union industry’s mission of meeting their 138 million members and local communities needs with safe, affordable financial products and services.