Written by Steve Van Beek
Last Thursday, NCUA issued a final rule which made numerous technical corrections to NCUA's regulations. Of note are three that had caused continued confusion for compliance officers of credit unions:
- NCUA's Privacy Regulation - 12 CFR 716
- NCUA's SAFE Act Regulation - 12 CFR 761
- Share Insurance Coverage of Noninterest-bearing Transaction Accounts - 12 CFR 745.14
Privacy & SAFE Act. NCUA lost authority for both privacy and the SAFE Act on July 21, 2011 when regulatory authority transferred to the CFPB and the technical amendments add cross-references to the CFPB's regulations which credit unions must follow. Here is from the final rule:
"In 2010, President Obama signed into law the Dodd-Frank Act. The Dodd-Frank Act substantially changed the federal legal framework with respect to consumer financial protection regulation. Among the many changes, title X of the Dodd-Frank Act transferred to the CFPB NCUA’s rulemaking authority under the Gramm-Leach-Bliley Act and the Secure and Fair Enforcement for Mortgage Licensing Act of 2008.
To assist federally insured credit unions, the rescinded parts of NCUA’s regulations will retain their original heading and be amended to include a cross citation to the CFPB’s republished version of the regulation."
NCUA's regulations will be updated with the cross-reference after the final rule is published in the Federal Register. The CFPB’s privacy regulation is 12 CFR 1016 and the SAFE Act regulation is 12 CFR 1007.
Share Insurance. The third amendment I wanted to highlight - the amendment to NCUA's Share Insurance regulation - was one that NAFCU had asked for numerous times since December 31, 2012 (including our "Update the Regulations, Please!" blog post). Here is NCUA's summary of their amendment:
"Section 343 of the Dodd-Frank Act provided that, on a temporary basis, NCUA would fully insure the net amount that any member or depositor at an insured credit union maintained in a noninterest-bearing transaction account. NCUA amended part 745 of its regulations to implement these temporary statutory changes through a final rule that became effective on June 24, 2011. Consistent with the sunset provisions in Dodd-Frank Act section 343(b)(3) and §745.14 of NCUA’s regulations, NCUA is rescinding its regulations implementing the temporary expanded insurance coverage granted under Dodd-Frank Act section 343(b)(1). In particular, the rule removes the definition of “noninterest-bearing transaction account” in §745.1(f), and removes §745.14 governing noninterest-bearing transaction accounts. The Board notes, however, that these accounts continue to be insured under other provisions of part 745."
The unlimited share insurance coverage for noninterest-bearing transactions accounts expired on midnight on December 31, 2012. This change should also be reflected in the Electronic Code of Federal Regulations after the final rule is published in the Federal Register.
Programming Note: NAFCU's offices will be closing early today and we'll also be closed on Monday for the holiday.
We'll be back blogging on Tuesday - have a great weekend!