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There have been many changes to the Consumer Financial Protection Bureau (CFPB) over the past week. Prior to the nomination of Jonathan McKernan, acting director Russell Vought ordered the employees to halt all work tasks and stay home. Since then, dozens of probationary employees have been fired. McKernan was formerly at the FDIC until Monday and has spoken in favor of deregulation. The closure of the CFPB is being challenged in court. These changes may mean a temporary pause in new regulatory guidance and enforcement actions from the CFPB; however, given the shifting regulatory environment, we encourage credit unions to continue following existing CFPB guidance until there is more clarity.
On Monday, the House passed H.R. 975, the Credit Union Board Modernization Act. This bill, introduced by Representative Juan Vargas of California, aims to amend the Federal Credit Union Act to modify the frequency of meetings for boards of directors, among other provisions. The bill allows credit unions to hold board meetings less frequently than the current monthly requirement, provided they meet at least quarterly. This change is intended to reduce administrative burdens and allow boards to focus on strategic issues. The bill also permits board members to participate in meetings remotely using teleconferencing or other digital means, yet maintains reporting requirements to ensure that credit unions operate transparently and with accountability.
The previous version of the bill, H.R. 582, was introduced in the 118th Congress and passed the House but did not advance in the Senate. The bill was reintroduced in the current session with some modifications to address concerns raised during the previous debates. These changes included more specific guidelines on meeting frequency and enhanced reporting requirements to ensure continued oversight and accountability.
Opponents raised concerns about the potential for reduced oversight and accountability. They cautioned that less frequent meetings could lead to governance issues and a lack of timely decision-making. Despite these concerns, the bill garnered bipartisan support, reflecting a broad consensus on the need for regulatory updates in the financial sector. We hope to see the bill introduced in the Senate sometime this session so it can continue moving through the process.