January 27, 2017

Trump reg freeze, NCUA news eyed in blog

The "regulatory freeze" memo issued by the Trump administration and recent news from the NCUA are detailed today by NAFCU Regulatory Affairs Counsel Ann Kossachev in a Compliance Blog post.

Kossachev noted potential regulatory changes may be on the horizon given the memo from the Trump administration to heads of executive departments and agencies about a "regulatory freeze pending review." She explained that the past three presidents have issued similar freeze memos.

NCUA, an independent agency, is not addressed in that memo. However, Kossachev said whether the freeze applies to the CFPB "hinges on whether the Trump administration still considers the CFPB an independent agency in light of the D.C. Circuit's recent decision in PHH Corp. v. CFPB." She was referring to the ruling in October by a three-judge panel that the bureau's single-director structure is unconstitutional.

The CFPB has not commented on the regulatory freeze, and it is not clear how the administration will react to any further CFPB rulemaking. NAFCU will be monitoring the situation closely.

Kossachev also highlighted recent news from the NCUA, including J. Mark McWatter's designation as acting board chairman last week. She also reviewed the U.S. District Court for the Eastern District of Virginia's decision to dismiss the Independent Community Bankers of America's suit against the NCUA over its member business lending rule.

"The Court dismissed the lawsuit on procedural grounds, specifically, the suit was untimely and ICBA lacked standing because it could not show an impending harm to its members as a result of the MBL rule," Kossachev wrote.

"The Court's decision reaffirmed what NAFCU has believed all along, that is, this lawsuit was nothing more than a frivolous attempt to distract from issues plaguing the banking industry, namely a lack of focus on serving their customers in favor of bigger profits," she continued.