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Cornerstone Provides Legislative Briefing to Members at CUNA GAC
Tuesday, February 27, 2018 7:05 AM

Cornerstone offered a Legislative Issues Briefing to member credit unions yesterday during the CUNA Governmental Affairs Conference. The briefing encompassed topics credit unions could discuss with their members of Congress, including ADA website litigation, regulatory relief and bills in play (S. 2155 and H.R. 1264), stopping the merchant data breaches, and preserving the tax status.

Cornerstone Chief Advocacy Officer Jim Phelps led the briefing and noted that more than 50 credit unions in the region had received demand letters or were victims of frivolous lawsuits brought by out-of-state law firms abusing the ADA tools. He said Congress and the Department of Justice need to act, and he suggested that credit unions ask their lawmakers to provide legislative and regulatory guidance to protect credit unions from this predatory litigation.

Phelps made the case for S. 2155, the Economic Growth, Regulatory Relief, and Consumer Protection Act, which contains several provisions that would reduce regulatory burden for credit unions and other financial institutions. The total financial impact of regulations on credit unions is over $6 billion and costs each credit union member household $115 per year. Phelps noted that S. 2155 is the primary legislative vehicle for regulatory relief in this Congress, so credit unions should ask their lawmakers for support of S. 2155.

Another bill that's hot right now is H.R. 1264, which allows for CFPB exemption authority regarding credit unions. The bill passed out of committee in January 2018, and currently has 29 cosponsors. H.R. 1264 would require the CFPB to exempt credit unions and community banks under $50 billion in assets from all future rules. Credit unions were encouraged to ask their lawmakers to cosponsor H.R. 1264 and bring it to the House floor for a vote.

Regarding merchant data breaches, Phelps reiterated that retailers don't face the same data security standards that credit unions are subject to, yet data breaches expose credit unions to significant costs and reputational risks. He said that in 2017, 1,579 data breaches occurred in the U.S. and the number of compromised records jumped 389 percent to a total of nearly 180 million records.

Cornerstone advocated for the credit union tax exemption in meetings with Ways and Means Chairman Kevin Brady and other key stakeholders, and the credit union tax exempt status remains unchanged in the recent tax reform bill. Phelps noted Senate Finance Chair Orrin Hatch’s letter to NCUA questioning credit union system and the tax exemption, and encouraged credit unions to ask their lawmakers to retain the credit union tax status in any comprehensive tax reform legislation.