For community banks, there is an ever-present concern that
new regulatory proposals crafted with the largest and most complex institutions
in mind will impose undue burdens on smaller entities.
Trade advocates for community banks stressed these concerns
to federal regulators in letters to the Federal Trade Commission (FTC) and the
Federal Deposit Insurance Corp. (FDIC) regarding their respective proposed
rules.
Read about these matters and more below:
MBA reiterates support for legislation outlawing trigger
leads
Mortgage Bankers Association (MBA) President and CEO Bob
Broeksmit reiterated the mortgage industry’s long-held support for legislative
measures aimed at banning companies from using “trigger leads” or “trigger
lists” as part of their business models. Broeksmit released a statement noting
MBA’s endorsement of the bipartisan Homebuyers Privacy Protection Act,
which mirrors a similar
measure introduced in the Senate in December.
“MBA continues to be a fierce proponent for legislative
reforms that stop the abusive use of mortgage trigger leads while preserving
their value in appropriately limited circumstances during a real estate
transaction,” Broeksmit said. “This updated House companion bill harmonizes
with the MBA-supported trigger leads bill in the Senate – introduced in
December 2023 – and furthers the momentum for legislative action on this issue.”
ICBA to FTC: Exclude community banks from rulemaking
Responding to the FTC’s proposed rulemaking to prohibit
FTC-regulated businesses from omitting mandatory fees associated with goods and
services from advertised prices, and misrepresenting the nature and purpose of
such fees, the Independent Community Bankers of America (ICBA) Senior Vice
President, Senior Regulatory Counsel Rhonda Thomas-Whitley wrote a letter
urging the FTC to exempt community banks from the rule. In the letter, she explained
that although federally supervised financial institutions fall outside the
jurisdiction of the FTC, federal banking agencies follow Section 5 of the FTC
Act during their examinations to detect unfair or deceptive practices. With
this in mind, ICBA and community bankers are apprehensive that these agencies
might adopt the FTC’s proposed definition in their assessments. The full letter
is available here.
Community banks urged to oppose FDIC corporate governance
proposal
Community banks are being urged to voice their opposition to
the FDIC’s proposed rule to require banks with $10 billion or more in assets,
and some community banks of any size, to adopt new requirements and liabilities
on bank boards beyond those required by state-chartering authorities. As part
of its grassroots effort to get the FDIC to exempt community banks from the
rule, the ICBA sent a letter to member banks encouraging them to write to the
agency expressing concerns with the proposed standards and their potentially
harmful impact on community banks’ ability to attract directors. Learn more here.
CBA urges government collaboration to prevent fraud,
scams
Consumer Bankers Association (CBA) President and CEO Lindsey
Johnson wrote to the Senate Banking Committee ahead of its recent hearing
on prevalent frauds and scams affecting the banking industry. The CBA
highlighted what it believes to be some of the most significant fraud threats
facing consumers and described the role the banking industry has taken in
identifying and countering such threats.
“Banks have been on the front lines dedicating enormous
resources – billions of dollars and thousands of hours by dedicated teams each
year – to fight fraud and scams and continue to enhance these efforts in
response to increasingly prevalent and sophisticated methods used by criminals,
many of whom operate under state sponsored or organized crime rings,” Johnson
wrote.
Johnson also noted CBA’s stance that the Consumer Financial
Protection Bureau (CFPB) should work collaboratively with other financial
regulators, law enforcement agencies, as well as the private sector, on a
cross-industry basis (including telecommunications, credit reporting, non-bank
financial and technology providers, and financial institutions) to educate
consumers on fraud and scams and how to avoid them. The full letter is
available here.