FED TO SET FINAL DEBIT RULE AT ITS UPCOMING MEETING
WASHINGTON-The Federal Reserve Board will meet this week to vote on a final rule implementing cuts in debit fees.
The meeting comes as the July 21 deadline for implementation, as set in last year's Wall Street reform bill, is rapidly approaching, giving credit unions and banks less than a month to prepare for the final rule.
The final rule is expected to represent a compromise over a proposal issued for comment in December, which would set the cap at 12 cents per transaction. The final rule is widely expected to set a higher cap.
Credit unions and banks have waged a vicious lobby against the debit cuts, but failed to convince Congress earlier this month to delay the final rule.
The stakes are enormous, with credit unions and banks earning $20.5 billion last year in debit fees, an estimated $2.6 billion of it going to credit unions.
NCUA'S FENNER RETIRES; TO BE REPLACED BY MCKENNA
ALEXANDRIA, Va.-Bob Fenner, a fixture at NCUA Board meetings and at Congressional hearings on credit unions for more than 30 years, will retire as the agency's General Counsel August 1.
Fenner, who has been with NCUA since 1974, will be succeeded by Michael McKenna, currently deputy General Counsel.
Fenner has long played a key role in NCUA policy and supervisory actions, from helping draft and enforce the multiple groups policy that led to the 1998 Congressional battle over HR 1151, the CU Membership Access Act, to overseeing the legal fight against credit unions conversions to banks, to the current efforts to resolve the corporate credit union crisis, and all rulemaking in between. In his role he also appeared behind the NCUA Chairman during testimony before Congress. McKenna has worked with him on many of those initiatives, taking time off several times to act as top aide to several NCUA Board members.
A native of Missouri, Fenner joined NCUA as a staff attorney in 1974 and became the agency's general counsel in 1985.
Separately, NCUA Larry Fazio will become director of examinations and insurance as Melinda Love, the current director, prepares to retire in December. Love will work in Fazio's current role as deputy executive director of the agency until then. Love, who has been with NCUA since 1986, served as director of two different regions before being named the agency's chief examiner as head of E&I in 2009.
Fazio joined NCUA as a field examiner in 1991 then was appointed director of risk management in E&I in 2002, before being promoted to deputy executive director in 2008. Fazio joined NCUA as a field examiner in 1991 then was appointed director of risk management in E&I in 2002, before being promoted to deputy executive director in 2008.
NCUA also said the agency's Office of Capital Markets will become a part of the Office of Examinations and Insurance.
NAFCU CALLS ON CONGRESS TO EXAMINE SECURITY BREACHES
WASHINGTON-NAFCU called on Senate leaders last week to heed the spreading threats posed by new data security breaches and proceed with legislation that would protect consumers and card issuers from breaches.
NAFCU called on leaders of the Senate Banking Committee to pass legislation that would make merchants responsible for a breach to pay the costs of resolution; set national standards for safeguarding data; disclose publicly the source of a data breach; and enforce current industry rules on data retention.
The Senate's renewed interest comes as dozens of credit unions and banks are shutting down cards and issuing new ones to stem major breaches, such as the one at Michaels Stores.
"This demonstrates what we have been communicating to Congress all along; credit unions and other financial institutions, not retailers, are out front protecting consumers in picking up the pieces after a data breach occurs," Dan Berger, NAFCU's chief lobbyist, told the Senate leaders in a letter last week. "It is the credit unions and other financial institutions that must notify their account holders, issue new cards, replenish stolen funds, change account numbers, and accommodate increased customer service demands that inevitably follow a major data breach. The negligent merchant who caused these expenses by failing to protect consumer data loses nothing and is often undisclosed to the consumer."
The NAFCU lobbyist was referring to costs borne by credit unions to resolve data breaches on debit cards, which they are hoping the Federal Reserve includes in calculating its impending cap on debit fees.
Like the fight over debit fees, the issue of data security pits the credit unions and banks against their long-time business partners, the retailers. The retailers, who lobbied for the cap on debit fees, have been fighting to prevent tougher penalties and costs for sources responsible for data breaches. Their opposition has stalled data security legislation for the past three congresses.