WASHINGTON, D.C. - The National Credit Union Administration has retained a consulting group to instruct its examiners on compliance with consumer protection laws.
Starting in the first quarter, KPMG Peat Marwick will teach examiners from each of the agency's six regions how to recognize and address violations of consumer laws.
"We'll have a small cadre of specialists that our examiners can call for help when they need it," said David M. Marquis, director of the NCUA's Office of Examination and Insurance. "Our examiners are safety-and- soundness driven, and they've always felt they've been behind the curve on consumer regs."
Although the agency feels it has a way to go in mastering consumer laws, it has improved its compliance monitoring.
One indicator is that it has found more credit unions in violation of regulations. The agency found 400 credit unions out of line with regulations in the year ending June 30, 1994, according to a Jan. 4 letter Mr. Marquis sent the Federal Reserve. The agency reports on consumer law compliance annually to the Fed.
In the year-earlier period, the NCUA found 253 violations.
"We have significantly improved our monitoring and tracking practices for violations of consumer regulations," Mr. Marquis wrote. "This accounts for much of the growth in the number of violations reported."
The NCUA focused on compliance with the Equal Credit Opportunity Act, the Expedited Funds Availability Act, the Electronic Funds Transfer Act, and the Truth-in-Lending Act.
Truth-in-Lending recorded the most violations, with 235, up from 166 in the year-earlier period. Equal Credit Opportunity was the second-most flouted law, with 123 violations, up from 55.
Mr. Marquis said he expects the number of reported violations to rise over the next couple of years. The level then is expected to decline as the bulk of noncompliance is discovered and examiners work with credit unions to fix the problems.
