NCUA’s Harper Seeks Comments on Proposal for Consumer Compliance Exams

As part of the National Credit Union Administration’s 2020-21 budgeting process, NCUA Board Member Todd Harper is requesting public comment on his proposal to create a dedicated consumer compliance examination program for larger and more complex credit unions. Harper’s proposal would add three new full-time employee positions to develop and launch a consumer compliance program.

“For more than three decades, the NCUA has focused its examination program primarily on safety and soundness reviews,” Harper said. “This policy worked well when the NCUA oversaw a large number of small credit unions serving a limited field of membership with only a few basic financial products, but today’s credit unions are larger and more complex, with 317 credit unions exceeding $1 billion in assets having 71.7 million members.”

Harper noted in a September speech that NCUA’s current approach to enforcing consumer protection laws for credit unions with less than $10 billion in assets is “not comparable to our sister agencies.” (CUs with more than $10 billion in assets are subject to Consumer Financial Protection Bureau supervision.) He noted that bank regulators conduct regular risk-focused consumer compliance exams and assign separate consumer compliance ratings. Comments on Harper’s proposal as part of the overall NCUA proposed budget are due by Dec. 2.