White House tells FI regulators to submit rules for review
The White House is instructing federal banking regulators and other independent agencies to submit guidance and proposed rules to the Office of Information and Regulatory Affairs (OIRA) to determine whether it is "major" and will require congressional approval.
"One of NAFCU's key tenets is to support a strong independent NCUA," said NAFCU Executive Vice President of Government Affairs and General Counsel Carrie Hunt. "While currently, the NCUA submits the majority of its rules and regulations to the Office of Management and Budget for an information collection review prior to implementation, the procedures outlined in the memorandum go further than that. NAFCU shares the goal of the White House to avoid runaway regulation, but wants to ensure that the NCUA can maintain its independence as well."
As an independent agency, the NCUA has traditionally taken the position it does not have to follow White House directives but often voluntarily chooses to do so.
Office of Management and Budget (OMB) Acting Director Russell Vought issued the memorandum last week. Vought cites the Congressional Review Act as the reasoning behind the memo's request. A policy is considered "major" if it will have:
- an annual effect on the economy of $100 million or more;
- a major increase in costs for prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions; or
- significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and export markets.
The Senate last year repealed the CFPB's indirect auto lending bulletin using the CRA; it was the first use of the CRA on regulatory guidance that was never submitted to Congress as a rule. At that time, NAFCU flagged that use of the CRA in this way would allow Congress to look at other bulletins and guidance issued by regulators that they haven't had a chance to review – potentially opening up more regulatory relief opportunities for the credit union industry.