WASHINGTON–After two days of being battered by credit unions, trade association execs and members of Congress, the head of the CFPB told credit unions that each has much in common, before offering a preview of where the agency will be focused in the future.
In remarks to NAFCU’s Congressional Caucus here, Richard Cordray, director of the Consumer Financial Protection Bureau, marked the agency’s fifth anniversary by saying it shares many of the same goals as credit unions and that “we have a considerable stake in one another’s success.”
That message ran counter to much of what had been said just one day prior, when one NAFCU compliance expert said some of the agency’s rules come with 1,800-page preambles that are increasingly difficult to decipher, as CUToday.info reported here.
Cordray said the Credit Union Advisory Council was created to ensure that credit unions could weigh in directly on policy priorities and provide it with information and perspective on consumer financial markets.
“The more we hear about your perspective and your members, the better we can respond,” he told a CU audience. “Credit unions often note that they made consumer protection their first priority long before the Consumer Bureau was born. We agree that you did not cause the financial crisis and performed well during that very difficult period in our country’s economic history. For that reason, we have regularly taken a close look at how credit unions operate and we have worked to accommodate the specific needs of smaller financial institutions. And we will continue to do so.”
After outlining the reasons the CFPB was created, Cordray touched on its rules around mortgages, suggesting the clearer rules for consumers were a contributor to the 39% increase in CU Mortgage lending through the first nine months of 2015.
“One thing we have learned from our discussions is that smaller creditors operate differently from larger financial institutions,” Cordray said. “So we continue to think hard about the challenges faced by most credit unions, which seek to maintain their traditions of flexible yet responsible lending. It is an invaluable service to consumers, especially in rural areas and towns like the one in Ohio where I grew up and still live with my family today. So when you raise these concerns, we listen closely.”
Cordray also gave credit unions a preview of where the CFPB is looking moving forward. He noted the CFPB is in the process of finalizing rules around prepaid cards, small-dollar loans, debt collection, and checking account access. He said the CFPB is also advocating for more financial education efforts, especially in schools.
Cordray did not speak to any of the comments critical of the CFPB that were made prior to his remarks, including by one senator who said the agency violates the very principles established by the founding fathers, as CUToday.info reported here.