e-Weekly

July 20, 2011

Obama announces Cordray as CFPB nominee
President Barack Obama, on Monday, July 18, announced Richard Cordray as his nominee to serve as Consumer Financial Protection Bureau (CFPB) director, adding that he looked forward to working with the new agency.

Cordray has been serving as the CFPB's assistant director for enforcement, and has also served as the attorney general of Ohio and that state's treasurer.

Ohio Credit Union League representatives told News Now that the league worked closely with Cordray at the county and state levels as he developed a financial literacy campaign and encouraged younger Ohioans to plan for their financial futures through the "small savers" campaign.

Obama said that CFPB architect Elizabeth Warren recommended Cordray for the post.

Warren herself, in a statement, said that Cordray "has a proven track record of fighting for families during his time as head of the CFPB enforcement division, as attorney general of Ohio, and throughout his career" and will be "a strong leader" for the CFPB.

A number of key Republicans had opposed Warren for the CFPB position, raising doubts about the ability of her nomination to clear the U.S. Senate. Cordray's nomination also will require Senate confirmation and is not assured. Some in Congress are calling for structural changes to the CFPB before agreeing to confirm a director.

Created by the Dodd-Frank financial reform law, the CFPB is scheduled to become operational on Thursday, July 21. The new agency will take on oversight of the Equal Credit Opportunity Act and the Fair Credit Reporting Act, as well as regulations addressing electronic fund transfers, mortgage originator registration, and mortgage assistance relief services, on that date. The CFPB is taking over authority of these and other rules from the National Credit Union Administration (NCUA), the Federal Reserve, the Federal Deposit Insurance Corp., the Office of the Comptroller of the Currency, the Office of Thrift Supervision, the Federal Trade Commission, and the U.S. Department of Housing and Urban Development.

The agency also plans to release separate reports on remittances and credit scores on Thursday. The remittance report, according to the agency, will focus on ways to improve transparency and disclosures and on consumer remittance history. The credit score report will focus on differences between the credit scores that are provided to individual consumers for informational purposes and the credit scores that financial institutions use to determine eligibility for loans and other financial products.

The Credit Union National Association was updated on the CFPB's progress during a Monday conference call, and a release detailing the CFPB's work over the past year has also been published. For that release, click here.

National Social Responsibility Recognition Programs – Deadline August 19
Developing and entering your social responsibility project helps your local community -- and its representatives in state and federal government -- better understand the credit union difference. The greater the understanding of this difference, the greater chance that the credit union tax exempt status will be preserved and accessibility to credit unions guaranteed for all consumers.

Since 1987, the Dora Maxwell Social Responsibility Community Service Award has honored credit unions for their charitable works in their communities. Some credit unions have ongoing programs and establish a special relationship with local social service agencies or school programs. Other programs address many different needs in the community. No matter the size or scope of a project, each participating credit union builds its reputation as a good corporate citizen along the way.

Credit unions enter the Dora Maxwell Award program in one of eight asset categories or the chapter/multiple credit unions category.

Beginning in 1990, the Louise Herring Philosophy-in-Action Member Service Award has commended credit unions that make exceptional efforts to include credit union philosophy in their daily operations and member service. Programs that provide financial education to particular member groups within the credit union or special assistance to low-income members struggling to pay heating bills, for example, are clear examples of the philosophy that sets credit unions apart from other financial institutions.

Entrants in the Louise Herring Award program compete in four asset categories.

Send your entry to Donna Bevilacqua, director, communications and community relations by August 19. Each submission must be accompanied by a $50 entry fee made payable to the League. First place winners will advance to the national competition. National winners will be honored at the Governmental Affairs Conference in Washington, D.C., in February 2012. Click here to access the National Social Responsibility Recognition Award Program Entry Forms.

By entering the National Social Responsibility Recognition Awards Program, you are accomplishing many goals: you are helping your community and your members, and showing lawmakers that credit unions are something special -- and should remain that way.

For more information, contact Donna Bevilacqua at 1-800-842-1242 or dbevilacqua@cucenter.org.

CUNA calls for comments on IRS Form 990 changes
Should the Internal Revenue Service's (IRS) employee compensation-reporting thresholds be changed? The Credit Union National Association (CUNA) is seeking credit union input for this and other questions related to the IRS's recent changes to its Form 990.

State-chartered credit unions are required to file Form 990 with the IRS annually, although a few states still permit group 990 filings. Federal credit unions are not required to file, since they are not subject to unrelated business income taxes.

The IRS made widespread changes to its Form 990 in 2008, and continues to gradually revise portions of the form.
The IRS requires Form 990 filers to disclose the names and compensation of certain key employees, their highest compensated employees, any independent contractors that work for the firm, and former high ranking or key employees. However, the reporting thresholds for these positions differ somewhat from position to position.

Some have criticized these reporting requirements, claiming that they decrease transparency. Others believe a single, uniform reporting threshold should be adopted.

The IRS and CUNA are also seeking input for portions of Form 990 that relate to net asset reconciliation, audited financial statement reporting, and related organization reporting.

The IRS will accept public comments until August 1. Comments should be sent to CUNA by July 25.

For the full comment call, click here.