Credit-union leaders called on Congress Nov. 16 to amend required disclosures at ATMs, eliminate annual privacy notices required for members and reduce financial reporting for small credit unions as part of its next round of sought regulatory relief.
The Electronic Funds Transfer Act’s requirements for physical disclosures of ATM fees, the target of dozens of recent lawsuits, has become outdated in the age of electronic disclosures and is in need of a legislative fix, contends Bill Cheney, president of Credit Union National Association, which represents credit unions.
Dozens of credit unions and banks have entered into settlements over the past year with individuals who claim their ATMs lacked a physical disclosure of the fees charged. In one instance, so-called ATM vigilantes have traveled around the country with camera in hand and sued more than 40 credit unions and banks for failing to post a physical disclosure at their ATM, while extracting thousands of dollars in settlements for violating the funds-transfer act (
Cheney also urged the House Financial Services Committee, which is reviewing a bill to roll back bank regulations, to exempt federally insured credit unions and banks from the costly requirement under the Gramm-Leach-Bliley Act to provide annual privacy disclosures to all members.
The credit-union lobbyist also urged lawmakers to provide a short-form financial disclosure for smaller credit unions and banks and to require law enforcement to reimburse credit unions and banks for the production of mandated financial records as part of an investigation.
Cheney and Fred Becker, president of the National Association of Federal Credit Unions, both called on the House committee to expand the bank bill. “The Communities First Act” would include a variety of long-time credit union priorities, including an increase in the member business-loan limit, an allowance for credit unions to raise secondary capital and an ability for community chartered credit unions to add underserved communities to their fields of membership–just as multiple group credit unions may do now.
“Credit unions are in need of regulatory relief. The Communities First Act would be greatly strengthened by adding credit union relief provisions that would make it a much more comprehensive package,” said Becker.
Both Cheney and Becker were careful not to expressly oppose a proposal that would allow a big increase in the number of tax-exempt Subchapter S banks, but they suggested the hypocrisy of the bankers asking for a major tax break while continuing to call for the repeal of the credit union tax exemption.
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