The NCUA—and not the CFPB—should enforce consumer protectionlaws at credit unions, trade groups told the bureau.

“Above all else, NAFCU maintains that federally-insured creditunions should not be subject to the Bureau's enforcementauthority,” Ann Kossachev, NAFCU's regulatory affairs counsel toldthe agency, in commenting on the agency's role.

Under the control of Acting Director Mick Mulvaney, the CFPB hasbeen soliciting public comment on virtually all of itsactivities.

Under federal law, the CFPB performs enforcement at creditunions with $10 billion or more in assets. That means the agencyhas jurisdiction over seven credit unions.

In July, NCUA Chairman J. Mark McWatters asked then-CFPBDirector Richard Cordray to relinquish the bureau's supervisoryresponsibilities and allow the NCUA to perform them. Cordray didnot take that action. Cordray resigned to run for governor of Ohioand Mulvaney took over as acting director. McWatters has beenmentioned as a possible permanent agency head.

Meanwhile, the credit union trade groups agree withMcWatters.

The bureau “can delegate its examination and enforcement overthe seven largest credit unions to the NCUA, by exempting thesecredit unions” Elizabeth A. Eurgubian, CUNA's deputy chief advocacyofficer and senior counsel, said in a letter to the CFPB.

She said that the NCUA is better equipped to regulate credit unions than theCFPB.

She added that if the CFPB decides to retain control over thosecredit unions, “then it must work together with the NCUA as apartner throughout the examination and enforcement process.”

In addition, the trade groups said that the agency shouldclarify the bureau's enforcement based on Unfair, Deceptive, orAbusive Acts or Practices.

“Since the creation of the Bureau, the industry has remainedmystified as to what qualifies as a UDAAP violation, yet manyenforcement actions have resulted from an alleged UDAAP violation,”Kossachev wrote.

“UDAAP should not be used as a 'catch-all' for the Bureau toenforce policies not required by laws or regulations,” Eurgubianwrote.

However, in a letter commenting on the bureau's enforcementduties, Christina Tetreault senior staff attorney with theConsumers Union, said the agency had been effective in stoppingcertain debt collection practices at Navy Federal Credit Union.

In 2016, the CFPB announced that the credit union would pay $23million to members and a $5.5 million civil penalty for makingfalse threats about debt collection to active-duty military servicemembers, retired service members, and their families.

Tetreault said that the Navy Federal situation and othersdemonstrate that while prudential regulators may do an effectivejob of monitoring safety and soundness issues “the violations ofconsumer protection law that these CFPB enforcement actionsuncovered demonstrate the importance of having a dedicated team offederal regulators focused solely on ensuring that those causingconsumer harm are stopped, and appropriate legal or equitablerelief is achieved.”