With the National Credit Union Administration and the Consumer Financial Protection Bureau (CFPB) zeroing in on Fair Lending laws and Home Mortgage Disclosure Act (HMDA) data collection this year, credit unions can expect to see additional rules and exams in 2014.
Anti-discrimination reporting and compliance also may be expanded to auto financing, business loans, and credit cards -- which could affect how credit unions lend to members. In July, the CFPB announced plans to draft a rule proposal to amend HMDA to require significantly more information from lenders, such as identifiers for loans, parcels, and loan originators.
Bill Klewin of the Credit Union National Association says the CFPB and federal agencies like the Department of Justice and Department of Housing and Urban Development have actively pursued fair lending cases, probing whether lending practices have a disproportionately adverse impact on minorities -- even if unintended. Agencies must use disparate impact tests, Klewin adds, because more overt discriminatory acts are less prevalent. He also points out that membership limitations often create HMDA statistics that would label credit unions as statistic outliers compared to more general lenders, potentially leading to regulatory review. Credit unions have complained about a lack of clarity in how they can determine if they are in compliance and how to plan for a fair-lending exam.