* WASHINGTON (8/14/08)--The Federal Reserve Board Wednesday requested public comment on a proposed change to Regulation S
, its Right to Financial Privacy rule. That rule sets the rates and conditions under which a government agency must reimburse a financial institution for costs incurred in producing customer financial records under the Right to Financial Privacy Act. The revision proposes two updates. First, the personnel fees that may be charged for searching and processing document requests are increased substantially. Second, the proposed amendments encourage electronic document productions by not allowing a 25 cents per page fee to be charged for printing electronically stored information. The proposal also includes an automated mechanism for periodically updating the labor rates found in the regulation… * WASHINGTON (8/14/08)--Industry representatives are charging that new regulations to reform the mortgage brokerage industry are incomplete. A registry that would be established to license brokers under the new rules is flawed, according to the banking industry (American Banker
Aug. 13). Each state will police its own licensing, which will likely lead to inconsistent enforcement, according to Doug Landy, a New York banking lawyer. All brokers must be licensed and entered into the registry by October 2010. To receive a license, brokers must undergo 24 hours of training and pass an exam. Observers also cited yield-spread premiums and said the reform won’t work until brokers maintain a monetary responsibility to borrowers. Currently, brokers earn fees on the premiums. If borrowers pay broker fees right away, it can lower closing costs in exchange for a higher interest rate ... * WASHINGTON (8/14/08)--Representatives from New York credit unions and the Credit Union Association of New York visited Capitol Hill to meet with 21 Congressional representatives, and their staff.
The delegates thanked lawmakers for supporting the Credit Union, Bank, and Thrift Regulatory Relief Act (CUBTRRA) and promoted sponsorship of the Credit Union Regulatory Improvements Act (CURIA). Credit unions met with the staff of Sen. Charles Schumer (D-N.Y.) and Sen. Hillary Clinton (D-N.Y.). From left are: Rob Nemeroff, marketing director, Melrose CU, Briarwood; James McKeon, board member, Municipal CU, New York City; Rep. Carolyn Maloney (D-Metropolitan); and William J. Mellin, league president. Evan Gotlob, strategic business analyst, Bethpage (N.Y.) FCU, and Fred Schaefer, Teachers FCU, Farmingville, also met with Maloney. (Photo provided by the Credit Union Association of New York) ...
WASHINGTON (8/14/08)—A bill that would exempt certain customers from currency transaction report (CTR) rules, as well as streamline that exemption process, was introduced in the House just before Congress recessed for its August District Work Session. Rep. Barney Frank (D-Mass.), who heads the House Financial Services Committee, and Reps. Bill Foster (D-Ill.) and Dennis Moore (D-Kan.), both committee members, introduced H.R. 6688, the Seasoned Customer CTR Exemption Act of 2008, on July 31. It shares the name and some provisions with legislation introduced by Rep. Spencer Bachus (R-Ala.), currently the ranking member of the committee, in 2006 and 2007. Nichole Seabron, federal compliance counsel for the Credit Union National Association (CUNA), said the bill combines the earlier seasoned customer legislation and the Financial Crimes Enforcement Network’s (FinCEN's) recent CTR revision proposal issued earlier this summer. "It is definitely something that would impact credit unions in a favorable manner," Seabron said. She highlighted the provisions she believes will be of most importance to credit unions. The bill impacts CTR exemption requirements. For instance, it would do away with the Phase I filing requirement for transactions between credit unions and other depository institutions, such as other credit unions, banks or corporate credit unions. The provisions also call for the removal of the biennial renewal requirement for Phase II exemptions--those pertaining to non-listed businesses and payroll customers. The bill gives credit unions more flexibility in determining when to grant exemptions and would allow them to grant exemptions within 2 months versus the 12-month requirement that is currently in place. Also, the bill provides for a "seasoned customer" exemption to CTR filing requirements, although it is not yet clear to what extent the exemption will benefit credit unions. The "seasoned customer" exemption would be applied to business account customers, such as incorporated/registered businesses, including sole proprietorships. Use the resource link below to access the text of the bill.
WASHINGTON (8/14/08)—Chairman Barney Frank (D-Mass.) of the House Financial Services Committees has announced his panel will conduct a Sept. 17 hearing to see if lenders are complying with lawmakers’ requests to hold off on mortgage foreclosures for a while. Frank and his committee members, Reps. Maxine Waters (D-Calif.), Mel Watt (D-N.C.) and Brad Miller (D-N.C.), have called for forbearance by mortgage lenders for the next several months as a new mortgage rescue program is set up under the authority of the Housing and Economic Recovery Act. The act, signed into law by the president late last month, states the rescue program will be operational by Oct. 1. Frank said in a release that mortgage servicers have reported progress in addressing the foreclosure crisis through such things as a greater willingness to engage in meaningful loan modifications that materially alter a borrower’s ability to repay the loan; and new hiring of servicing professionals to more quickly address the backlog. However, Frank said that some individuals facing foreclosure, consumer advocates and others “have painted a very different picture: one that involves long waits and few, if any, meaningful loan modifications.” In a letter sent to 19 representing the mortgage servicing industry, the committee members asked for more information on current and anticipated practices to help troubled mortgage borrowers. To read the letter and the list of recipients, use the resource link below.
WASHINGTON (8/14/08)—The Credit Union National Association (CUNA) urged federal lawmakers Wednesday to reject a bill that could exacerbate the pain of higher auto fuel prices for consumers by setting arbitrary limits on interchange fees. In a letter to all U.S. House members, CUNA President/CEO Dan Mica urged them to oppose H.R. 6620, the “Gas Pump Fair Payment Act of 2008.” The bill, introduced in July by Rep. Stephen Lynch (D-Mass.), would amend the Truth in Lending Act to limit the amount of the interchange fee imposed on the sale of motor vehicle fuel. In addition to its impact on consumers, Mica also stated that the bill would “upset a delicate balance in the electronic payment system that reduces risk for both merchants and consumers.” Mica noted that capping interchange by statute would result in convenient debit and credit becoming less available and more expensive for consumers, causing credit unions to assess whether they can continue to offer debit cards and credit cards to their members. “To the extent that H.R. 6620 is intended to reduce the effect of higher gas prices on consumers, it is well-intentioned; however, the reality is that the bill will only benefit the gas station franchisees and the oil company conglomerates, which will be spared the responsibility to pay their fair share to use the electronic payments system,” Mica wrote. To read the full CUNA letter, use the resource link below.