ARLINGTON, Va.—NAFCU and CUNA are concerned about the potential negative impact on CUs from the CFPB’s Proposed Amendments Relating to Disclosure of Records and Information, and are also asking for clarification on the rules.
“NAFCU asks that the Bureau clarify what type of cooperation it seeks to enable with its new rule that did not exist previously,” wrote NAFCU Regulatory Affairs Counsel Andrew Morris in a letter to the CFPB. “For example, why is the Bureau’s current authority under Section 1070.43 inadequate to serve operational goals, and why is enhanced discretion to share this information with a broadly defined class of agencies necessary? The Bureau mentions impediments to cooperation with other agencies—yet offers no specific examples. NAFCU would like the Bureau to describe, in concrete terms, the type of enhanced cooperation it hopes to enable with its new amendments.”
Morris said that NAFCU believes that sharing confidential information with entities that have no direct role in regulating credit unions would create “unreasonable burdens” if complaint data is taken out of context.
“These burdens include safety and soundness concerns if shared data is lost or stolen, and subsequently causes the public to draw unqualified conclusions about the health or integrity of their credit union,” he said.
In a separate letter to the agency, CUNA outlined several “major” concerns with the proposal that the trade association says “will greatly expand the CFPB’s discretion to release more information to more entities.”
Luke Martone, senior director of advocacy and counsel wrote that information sharing is a critical component to “ensuring the safety and soundness of financial institutions and their provision of financial services to consumers. However, the vast expansion of information sharing contemplated by the proposal could increase the risk of unintended disclosures and a loss of confidentiality, which could ultimately harm consumers.”
Martone continued saying, “Although the proposed rule would make numerous amendments to all five subparts of part 1070 of the CFPB’s regulations, the comments in this letter focus primarily on the area of greatest concern: Subpart D—Confidential Information. CUNA is sharing its concerns with the Bureau on this proposal because more credit unions are becoming subject to direct examination by the Bureau as credit union membership and asset size overall continue to grow. Further, the impact of this proposed rule will not be limited to those financial institutions with at least $10 billion in assets, particularly with regard to disclosure of CII.”