Financial regulators, including the NCUA and the CFPB, have issued a final rule attempting to distinguish the difference between rules and guidance, but the future of that rule and several others remained in flux Thursday, after President Biden issued a temporary moratorium on regulations until they can be reviewed by the new administration.
The NCUA is an independent regulatory agency and is not required to comply with Executive Orders, but in the past, the agency has said it tries to follow the “spirit” of such orders.
NCUA officials did not respond to a request for comment about the rule or Biden’s actions Thursday.
In recent months, the NCUA board has approved a flurry of rules, as the chairmanship of Republican Rodney Hood likely comes to an end. For instance, this month the board approved proposed rules dealing with complex credit union, the CAMEL rating system, CUSOs and a final rule dealing with CUSOs.
And after the meeting, the board approved a final rule clarifying that agency guidance does not carry the same force as rules and that enforcement actions may not be taken based on guidance.
However, Biden signed an Executive Order Wednesday stating that, with some exceptions, after Jan. 20, agencies should not send rules to the Federal Register for publication until a department or agency head designated by him reviews and approves the rule. The Executive Order also stated that rules that have been published but have not become effective yet should be delayed for 60 days.
It also remained unclear whether agency heads appointed by Biden will want to go along with rules that recently were released. Democrat Todd Harper, who is likely to become NCUA board chairman, opposed several of the proposals presented by Hood.
At the CFPB, a consumer law task force appointed by then-Director Kathleen Kraninger issued a report containing proposed changes to the financial regulatory regime.
However, Kraninger resigned Wednesday at Biden’s request. Biden has announced his intention to nominate Federal Trade Commission Member Rohit Chopra to head the CFPB. Chopra worked for former CFPB Director Richard Cordray, who pushed a much stricter regulatory framework than Kraninger favors.
Until Chopra can be confirmed, Biden appointed CFPB employee Dave Uejio to run the agency. Uejio worked for both Cordray and Kraninger.
Meanwhile, Biden also rejected an Executive Order issued by Trump that restricted the types of diversity training agencies may conduct.
A Latinx activist charged in September that her speaking engagement at the NCUA was cancelled at the last minute, as the agency enforced the Trump Executive Order. Rosa Clemente was scheduled to hold a session entitled, “Unapologetically Black: Afro-Latinx Culture and Identity” as part of a Hispanic Heritage Month event.
Grant Sheehan CCUE | CCUP | CEO, NCOFCU The B reach Between Purpose and Experience Just recently, I came across a story that has stayed with me. It wasn’t dramatic in the traditional sense. There was no scandal, no crisis, no headline-grabbing failure. In fact, it was something much quieter than that. It was simply the story of an eighteen-year-old leaving his credit union. On the surface, that might not sound remarkable. Young people move their money frequently. They open new accounts, experiment with apps, follow trends, and often make financial decisions influenced by the digital tools at their disposal. But this story was different. This young man had been a credit union member since he was a few weeks old, as many credit unions do. His mother has spent her career working inside the credit union movement as an executive. For eighteen years, his financial life was connected to a credit union. If anyone might be expected to remain a lifelong member, it wou...
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