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Compliance Update with Amy K by Amy Kleinschmit, Chief Compliance Officer Payday Lending Recently, the U.S. District Court for the Western District of Texas (Austin Division), granted the CFPB's motion for summary judgment in Community Financial Services Association of America, Ltd., Consumer Service Alliance of Texas v. Consumer Financial Protection Bureau [and its Director], and ordered that the August 19, 2019, compliance date of the CFPB's "Payday, Vehicle Title, and Certain High-Cost Installment Loans" Rule (12 CFR Part 1041) be stayed until 286 days after the date of the court's order. Unless the Bureau further amends the rule to delay the effective date further, or the plaintiffs appeal the ruling of the court, the rule will become effective June 13, 2022. CFPB Acting Director Dave Uejio issued a statement following this decision. NCUA DEI Summit Registration is open for the National Credit Union Administration’s DEI Summit 2021 – From Intention to Action. Event detail and registration can be found here. This Summit will occur November 2 to 4 and is free to attend. The NCUA’s Diversity, Equity and Inclusion Summit (DEI Summit) is a three-day event where credit union and industry professionals who are committed to advancing diversity, equity and inclusion within the credit union system will gather to share best practices, address challenges to advancing diversity, and learn how the NCUA can support the industry in its efforts. InfoSight – Your Opinion Matters! It’s that time of year again, League InfoSight is looking for credit union feedback on its products and services. This feedback helps us prioritize new development and initiatives. We appreciate your time and input to help make our products and support even better! Visit https://www.leagueinfosight.com/survey2021 and let us know how we are doing! Advertising Reminder - NCUA Part 740 to NCUA’s rules and regulations requires federally insured credit unions to use the official advertising statement in certain advertisements and includes certain specifications as it relates to the readability of this statement. The official advertising statement must also be used on the main internet page. “Advertisement” as used in this rule means a commercial message, in any medium, that is designed to attract public attention or patronage to a product or business. Remember it says “any medium” – it also includes social media. The advertisement must be accurate. No insured credit union may use any advertising (which includes print, electronic, or broadcast media, displays and signs, stationery, and other promotional material) or make any representation which is inaccurate or deceptive in any particular, or which in any way misrepresents its services, contracts, or financial condition, or which violates the Truth in Savings requirements of §707.8. The rule provides several variations that can be used as the “official advertising statement.” The official advertising statement is in substance one of the following: “This credit union is federally insured by the National Credit Union Administration.” “Federally insured by NCUA.” “Insured by NCUA” Or a reproduction of the official sign may be used in lieu of the other statements. If the official sign is used as the official advertising statement, an insured credit union may alter the font size to ensure its legibility. The NCUA has not adopted nor approved the use of ‘‘NCUA Insured’’ or ‘‘Member NCUSIF.” The official advertising statement must be legible! The rule requires that the official advertising statement must be in a size and print that is clearly legible and may be no smaller than the smallest font size used in other portions of the advertisement intended to convey information to the consumer. In other words, if your advertisement is in 14 point font, the “Insured by NCUA” or other “official advertising statement” also must be in 14 point font. Also, meaning if you use the NCUA logo, which is an option, the text in the logo must comply with these minimum font size requirements. The rule does include a number of exceptions for advertisements that do not need to include the official advertising statement. For example, credit union supplies such as stationery (except when used for circular letters), envelopes, deposit slips, checks, drafts, signature cards, account passbooks, and non-insurable certificates; signs or plates in the credit union office or attached to the building or buildings in which the offices are located; advertisements by radio which do not exceed thirty (30) seconds in time; advertisements by television, other than display advertisements, which do not exceed thirty (30) seconds in time. Other exceptions include advertisements that, because of their type or character, would be impractical to include the official advertising statement, including but not limited to, promotional items such as calendars, matchbooks, pens, pencils, and key chains; or advertisements that do not relate to member accounts, including but not limited to advertisements relating to loans by the credit union, safekeeping box business or services, traveler's checks on which the credit union is not primarily liable, and credit life or disability insurance. As always, DakCU members may contact Amy Kleinschmit at akleinschmit@dakcu.org with any compliance related questions.
Compliance Update with Amy K
by Amy Kleinschmit, Chief Compliance Officer
Payday Lending
Recently, the U.S. District Court for the Western District of Texas (Austin Division), granted the CFPB's motion for summary judgment in Community Financial Services Association of America, Ltd., Consumer Service Alliance of Texas v. Consumer Financial Protection Bureau [and its Director], and ordered that the August 19, 2019, compliance date of the CFPB's "Payday, Vehicle Title, and Certain High-Cost Installment Loans" Rule (12 CFR Part 1041) be stayed until 286 days after the date of the court's order. Unless the Bureau further amends the rule to delay the effective date further, or the plaintiffs appeal the ruling of the court, the rule will become effective June 13, 2022. CFPB Acting Director Dave Uejio issued a statement following this decision.
NCUA DEI Summit
Registration is open for the National Credit Union Administration’s DEI Summit 2021 – From Intention to Action. Event detail and registration can be found here. This Summit will occur November 2 to 4 and is free to attend. The NCUA’s Diversity, Equity and Inclusion Summit (DEI Summit) is a three-day event where credit union and industry professionals who are committed to advancing diversity, equity and inclusion within the credit union system will gather to share best practices, address challenges to advancing diversity, and learn how the NCUA can support the industry in its efforts.
InfoSight – Your Opinion Matters!
It’s that time of year again, League InfoSight is looking for credit union feedback on its products and services. This feedback helps us prioritize new development and initiatives. We appreciate your time and input to help make our products and support even better!
Visit https://www.leagueinfosight.com/survey2021 and let us know how we are doing!
Advertising Reminder - NCUA
Part 740 to NCUA’s rules and regulations requires federally insured credit unions to use the official advertising statement in certain advertisements and includes certain specifications as it relates to the readability of this statement. The official advertising statement must also be used on the main internet page.
“Advertisement” as used in this rule means a commercial message, in any medium, that is designed to attract public attention or patronage to a product or business. Remember it says “any medium” – it also includes social media.
The advertisement must be accurate. No insured credit union may use any advertising (which includes print, electronic, or broadcast media, displays and signs, stationery, and other promotional material) or make any representation which is inaccurate or deceptive in any particular, or which in any way misrepresents its services, contracts, or financial condition, or which violates the Truth in Savings requirements of §707.8.
The rule provides several variations that can be used as the “official advertising statement.” The official advertising statement is in substance one of the following:
“This credit union is federally insured by the National Credit Union Administration.”
“Federally insured by NCUA.”
“Insured by NCUA”
Or a reproduction of the official sign may be used in lieu of the other statements. If the official sign is used as the official advertising statement, an insured credit union may alter the font size to ensure its legibility.
The NCUA has not adopted nor approved the use of ‘‘NCUA Insured’’ or ‘‘Member NCUSIF.”
The official advertising statement must be legible! The rule requires that the official advertising statement must be in a size and print that is clearly legible and may be no smaller than the smallest font size used in other portions of the advertisement intended to convey information to the consumer. In other words, if your advertisement is in 14 point font, the “Insured by NCUA” or other “official advertising statement” also must be in 14 point font. Also, meaning if you use the NCUA logo, which is an option, the text in the logo must comply with these minimum font size requirements.
The rule does include a number of exceptions for advertisements that do not need to include the official advertising statement. For example, credit union supplies such as stationery (except when used for circular letters), envelopes, deposit slips, checks, drafts, signature cards, account passbooks, and non-insurable certificates; signs or plates in the credit union office or attached to the building or buildings in which the offices are located; advertisements by radio which do not exceed thirty (30) seconds in time; advertisements by television, other than display advertisements, which do not exceed thirty (30) seconds in time. Other exceptions include advertisements that, because of their type or character, would be impractical to include the official advertising statement, including but not limited to, promotional items such as calendars, matchbooks, pens, pencils, and key chains; or advertisements that do not relate to member accounts, including but not limited to advertisements relating to loans by the credit union, safekeeping box business or services, traveler's checks on which the credit union is not primarily liable, and credit life or disability insurance.
As always, DakCU members may contact Amy Kleinschmit at akleinschmit@dakcu.org with any compliance related questions.