Posts tagged ‘President-elect Joe Biden’

Three Things to Ponder As You Start Your Credit Union Week

Good morning, folks. Here are some things to keep in mind as you start what promises to be an extremely eventful truncated week. 

Meet the New Boss

With the Supreme Court ruling that the director of the CFPB serves at the pleasure of the President of the United States, President-elect Biden has announced his pick to head the Bureau. Even with the Supreme Court ruling, no one in government has as much power to shape the regulations of the consumer financial sector than will Rohit Chopra.

Judging by the press reports I read over the weekend, there are few regulators who will have as much running room at the start of the Biden presidency as the CFPB. The conventional wisdom is that the CFPB was made “toothless” (New York Times) under the parting director Kathy Kraninger. While this is not true, perception is reality, and the list of top priorities is already emerging. Get ready to work on proposals dealing with overdrafts, student loan disclosures, mortgage forbearances and payday loans. All this will be in addition to a much more aggressive use of regulation through enforcement action. 

NCUA and CFPB Enter Into A MOU

David Baumann of the Credit Union Times reported Friday that the CFPB and the NCUA had agreed upon a Memorandum of Understanding. According to the NCUA, the purpose of this agreement is “to improve coordination between the agencies related to the consumer protection supervision of credit unions over $10 billion dollars in assets.” But we won’t know for sure, at least for a while, as the NCUA is making the CUTimes file a FOIA request to learn the contents of the memo.

Under the Dodd-Frank Act, the Bureau has direct supervision over institutions with $10 billion or more in assets. An institution is subject to this supervision once it reports four consecutive quarters of $10 billion or more in assets. If I was at or near this threshold, I sure as heck would want to know what was in the MOU. After all, institutions have a right to know what’s expected of them; what regulators are overseeing them, and precisely with whom their supervisory information is being shared.

It’s Budget Day at the Capitol!

For New York Legislative geeks, today is like Christmas morning. You finally get to know what surprises are under the Budget tree, and there’s sure to be a few lumps of coal. Many of the big picture items are already being debated, such as online gambling and marijuana banking. And of course, the great wild card in all of this is the extent to which Congress will be able to ease New York’s fiscal woes. Goody gumdrops. 

Merry Christmas, Happy New Year, and enjoy your day.

January 19, 2021 at 9:43 am 1 comment

State Enacts New Restrictions on State Charter Inactivity Fees

Governor Cuomo has approved legislation requiring state chartered credit unions to provide additional notices to account holders prior to imposing inactivity fees. S.4188 (Kennedy) / A.9140 (Abinanti) takes effect in 90 days.

Under the bill, financial institutions will have to provide 30 days written notice before fees can be imposed, and the notice will have to include full contact information, including a phone number, for the account holder to use in reaching a representative from the financial institution. 

Although this is a legal determination that you should confirm with counsel, the bill does not apply to federally chartered institutions. First, the new law only applies to financial institutions subject to this chapter. This generally limits its jurisdiction to state licensed and chartered financial institutions, but there are some exceptions. Secondly, even if the state was to attempt to apply this provision to federally chartered credit unions, NCUA has repeatedly and clearly opined that inactivity fees are preempted as applied to federal credit unions. The bottom line is that the state has imposed another meddlesome mandate which makes the state charter less attractive, even though there are relatively few state chartered institutions left to regulate.

Here We Go Again?

New York State appears to be edging closer to reinstituting lockdowns. Reacting to a dramatic and uncontrolled spike in COVID-19 cases, the Governor yesterday released new restrictions on when restaurants, gyms and bars have to close by, as well as limits on the number of people permitted to meet at once. Look on the bright side: you know there are people you’d rather not spend Thanksgiving with, and this year you have the perfect excuse to disinvite them. This is a great solution for avoiding the inevitable political debate which will accomplish nothing besides ruining the day. 

New York Adviser Named to Biden Transition Team 

Even as Donald Trump refuses to concede that he lost the election, President-elect Joe Biden is moving ahead with his transition team. The ever-informative Washington Credit Union Daily gave me a heads up this morning that Leandra English has been named to the Biden Administration’s CFPB Review team, which will help set priorities for the Bureau under the new President. Nationally, English is best known as the Deputy Director under Richard Cordray, who argued that she could not be replaced as the Bureau’s acting director following Cordray’s departure. Locally, English has served as an adviser to New York State’s Department of Financial Services. If the past is prologue, this means the rest of the country should quickly expect a heavy emphasis on servicers offering forbearance options for individuals facing economic hardship as a result of the pandemic. 

November 12, 2020 at 9:17 am 2 comments


Authored By:

Henry Meier, Esq., Senior Vice President, General Counsel, New York Credit Union Association.

The views Henry expresses are Henry’s alone and do not necessarily reflect the views of the Association. In addition, although Henry strives to give his readers useful and accurate information on a broad range of subjects, many of which involve legal disputes, his views are not a substitute for legal advise from retained counsel.

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