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This Week in Washington: Lawmakers Consider Bills Supporting CUs
Tuesday, April 21, 2015 6:35 AM

It will be a short week for the House of Representatives, which returns to Washington today to consider several bills under suspension of the rules. On Wednesday and Thursday, the House is expected to consider H.R. 1195, the Bureau of Consumer Financial Protection Advisory Boards Act, the "Protecting Cyber Networks Act" (H.R. 1560), and the "National Cybersecurity Protection Advancement Act of 2015" (H.R. 1731). No votes are expected in the House on Friday.

On Wednesday, the House Financial Services Committee will hold a full committee hearing on "Task Force to Investigate Terrorism Financing – A Survey of Global Terrorism and Terrorist Financing." And the House Small Business Committee will hold a full committee hearing on "Small Business, Big Threat: Protecting Small Businesses from Cyber Attacks."

On Thursday, the House Financial Services Committee Financial Institutions and Consumer Credit Subcommittee will hold a hearing on "Examining Regulatory Burdens – Regulator Perspective." While the witnesses for this hearing have not been announced, it is expected that NCUA will have a representative at this hearing.

Stop the Data Breaches

Data security continues to be a focus in Washington. Last week, a number of important developments took place, setting this issue up for continued consideration for weeks to come.

On Wednesday, the House Energy and Commerce Committee marked up H.R. 1770, the Data Security and Breach Notification Act, and ordered the bill be reported favorably to the full House of Representatives by a vote of 29-20.

CUNA joined financial services industry groups on a letter to the Committee expressing their concerns with the legislation, including its insufficient merchant data security standards, its inadequate exemption for Gramm-Leach-Bliley covered entities, its ineffective language related to breach liability, and its imperfect preemption language. CUNA has serious concerns with this legislation, and they have encouraged leadership not to schedule it for a vote until those concerns are addressed. They have also been in contact with members on the House Financial Services Committee to explore the possibility of that committee exerting a jurisdictional claim on the legislation.

While the House Energy and Commerce Committee considered its flawed legislation, Sens. Tom Carper (D-DE) and Roy Blunt (R-MO) introduced a much stronger data breach bill, S. 961, the Data Security Act of 2015. CUNA joined the same group of financial services industry partners on a letter expressing support for the bill.

The Data Security Act would require entities, such as financial institutions and retailers, among other businesses, to better safeguard sensitive information, investigate security breaches, and notify consumers when there is a substantial risk of identity theft or account fraud. The bill also includes the important provision to exclude financial institutions from the requirements as they are already subject to rigorous standards under the Gramm-Leach Bliley Act (GLBA).

CUNA strongly supports S. 961; the bill represents the best attempt so far at legislation to stop merchant data breaches. CUNA will send a grassroots action alert encouraging credit union supporters to ask their Senators to cosponsor S. 961. It's important for us to show strong support for the bill in the Senate, because it is possible this legislation could be offered as an amendment to cyber security legislation in the coming weeks. 

Tax Reform

The Senate Finance Committee's Business Income Tax Working Group has been soliciting feedback from stakeholders regarding comprehensive tax reform. As part of that process, CUNA sent a letter to leadership of the working group, Sens. John Thune (R-SD) and Ben Cardin (D-MD) to urge Congress to retain and reaffirm the credit union tax status.

Regulatory Relief Legislation Passes the House

Six CUNA-supported bills which would provide credit unions with regulatory relief passed the House of Representatives last week and now move to the Senate for consideration.

  • H.R. 299, the Capital Access for Small Community Financial Institutions Act of 2015, which would allow privately insured credit unions to join the Federal Home Loan Bank system, passed by voice vote.
  • H.R. 601, the Eliminate Privacy Notice Confusion Act, which also passed the House by voice vote, would eliminate the requirement to send an annual privacy policy notification to credit union members unless a privacy policy has changed. [
  • H.R. 1259, the Helping Expand Lending Practices (HELP) in Rural Communities Act, which would direct the Consumer Financial Protection Bureau to establish an application process for determining whether an area is defined as "rural," passed by a 401-1 vote.
  • H.R. 1265, the Bureau Advisory Commission Transparency Act, would open up the CFPB's Advisory Council's meetings to the public. This legislation passed the House by a vote of 401-2.
  • H.R. 1480, the SAFE Act Confidentiality and Privilege Enhancement Act, would allow state and federal regulatory officials with financial services industry oversight authority to access information provided to the Nationwide Mortgage Licensing System and Registry without the loss of confidentiality protections provided by federal and state laws. This legislation passed by a vote of 401-0.
  • H.R. 685, the Mortgage Choice Act of 2015, would exclude affiliated title insurance from the definition of points and fees. This legislation passed the House by a vote of 286-140.

NCUA Budget Transparency

Sens. Dean Heller (R-NV) and Mark Warner (D-VA) introduced CUNA-supported legislation which would require the National Credit Union Administration to make several aspects of its budget process public. S. 924, the NCUA Budget Transparency Act, is based on testimony that CUNA has submitted to Congress several times over the last few years and would require NCUA to resume the practice of holding an annual hearing to receive stakeholder feedback on its budget.    

Senate Banking Committee Hearing on Regulatory Burdens to Mortgage Lending

Last week, the Senate Banking Committee held a hearing on "regulatory burdens to obtaining mortgage credit."

CUNA sent a letter for the record of the hearing outlining priorities for increasing access to mortgage credit, including deeming all mortgages in portfolio QM; providing relief from points and fees restrictions; revising the FHFA proposed rule requiring members of the FHLB system to maintain 10 percent of their assets in mortgage loans; allowing privately insured credit unions to join the FHLB system; improving the TILA-RESPA closing disclosure waiting period; and providing credit unions with parity on 1-4 non-owner occupied mortgage loans. CUNA believes these changes will remove barriers for credit unions to provide their members access to affordable mortgage products.