WASHINGTON—In response to an NCUA proposal to streamline rules governing indirect auto loans made by credit unions, the Defense Credit Union Council told NCUA in a comment letter is supports the principles-based supervisory approach outlined in the proposal.
Separately, Americas Credit Unions sent a letter ahead of a hearing on the Bank Secrecy Act.
DCUC argued that credit union boards are best positioned to oversee indirect lending programs through underwriting standards, concentration monitoring and vendor oversight while still maintaining safety and soundness protections through the examination process.
As the CU Daily previously reported, then CUA proposal would remove certain regulatory provisions tied to third-party servicing of indirect vehicle loans, including prescriptive lending limits, while giving federal credit unions more flexibility to establish lending policies tailored to their indirect lending programs.
‘Greater Flexibility’
“DCUC supports the NCUA’s proposed rulemaking. The proposal to remove current paragraph (h) from § 701.21 would provide federal credit unions with greater flexibility to develop lending policies appropriately scaled to their purchases of indirect vehicle loans serviced by third parties,” Jason Stverak, DCUC chief advocacy officer, wrote.
The DCUC added that it also supports removing corresponding provisions for federally insured, state-chartered credit unions in order to promote regulatory consistency while preserving supervisory oversight.
“We appreciate the NCUA Board’s continued efforts to modernize outdated and overly prescriptive regulatory requirements while maintaining strong supervisory standards,” Anthony Hernandez, DCUC president and CEO and a retired U.S. Air Force colonel, said in a statement released by the organization. “Providing credit unions with appropriate operational flexibility allows them to better serve their members, responsibly manage lending programs, and remain competitive in a rapidly evolving financial environment.”
Letter Sent on BSA Modernization
Separately, in advance of a House subcommittee hearing on modernizing the BSA, America’s Credit Unions provided several recommendations for Congressional actions in a letter.
The recommendations include:
- Modernizing the Currency Transaction Report (CTR) and Suspicious Activity Report (SAR) thresholds. Rep. Barry Loudermilk (R-GA) introduced a bill to increase the CTR threshold to $30,000, the SAR threshold to $10,000, and periodically adjust the CTR threshold for inflation;
- Simplifying CTR and SAR forms and filing processes to include updating data fields to remove redundancies and clarify confusing items, as well as permitting the use of templates for certain redundant instances and typologies of financial crimes
- Streamlining reporting options, such as a simplified “CTR-Lite” process for long-standing, low-risk members, along with extending filing windows for smaller credit unions
- Legislators advance legislative efforts to codify the BSA relief issued in February.
- Revisiting the Financial Crimes Enforcement Network (FinCEN) requirement to file marijuana limited SARs. If the requirement cannot be eliminated entirely, FinCEN should consider allowing credit unions to file marijuana limited SARs once a year; and
Improving the quality and completeness of identifiers included in 314(a) requests, including taxpayer identification number, passport number, date of birth, or address.
