WASHINGTON—A report published this week by the U.S. Government Accountability Office (GAO) recommended that depository institution regulators review the regulatory burden facing credit unions and other financial institutions and better explain the reasoning behind their regulatory actions.
The GAO said its findings are the result of interviews and focus groups with representatives from more than 60 credit unions and community banks. During those conversations, the most burdensome regulations identified were:
- Reporting mortgage characteristics
- Reviewing transactions for potentially illicit activity
- Disclosing mortgage terms and costs to consumers
The report included 10 recommendations for the CFPB and other depository institution regulators, noted NAFCU in its analysis. GAO specifically recommended that the CFPB in particular "assess the effectiveness and guidance on mortgage disclosure regulations and publicly issue its plans for the scope and timing of its regulation reviews and coordinate these with other regulators' review process."
“Another recent GAO report, which, in conjunction with this report, was the focus of a House Small Business Committee hearing this week, indicated that the ‘misunderstandings’ of TILA/RESPA integrated disclosure regulations ‘could be creating unnecessary compliance burdens for some small institutions.’ GAO also found that the CFPB had failed to review the effectiveness of guidance given to credit unions on the rule,” NAFCU noted.
As CUToday.info reported, NAFCU Vice President of Legislative Affairs Brad Thaler wrote to the committee ahead of the hearing to express support for their examination of this area.
NAFCU emphasized that it will continue to advocate that the CFPB and other financial regulators reevaluate regulations and pursue opportunities to reduce credit unions' regulatory burden.