Lawmakers take aim at credit union requirement

The Credit Union National Association is backing legislation introduced in the Senate Tuesday that would reduce how often credit unions must send privacy notices to customers. 

The Privacy Notice Modernization Act, introduced by Sens. Jerry Moran (R-Kan.) and Heidi Heitkamp (D-N.D.), aims to reduce the regulatory burden and enhance consumer protections by amending the Gramm-Leach-Bliley Act. Their bill would require credit unions to send privacy notices to members only when the credit union changes its privacy policy. 

“Resources that would otherwise be directly applied to serving clients and the community are now being spent to comply with annual privacy notices requirements and other regulations,” Moran said in a statement.

“Smarter regulation of financial privacy notifications will better protect and inform consumers while removing the excessive burdens placed on financial institutions.”

The privacy policies would have to be available to credit union members on demand and on the credit unions’ website. 

“The fact is that an annual privacy notice requirement is unnecessary, costly and confusing to our members,” CUNA President and CEO Jim Nussle said.

“Requiring the notice to be mailed only when the policy is changed will make the notice more meaningful to credit unions and their members. I thank Senators Moran and Heitkamp for their leadership on this important issue.”

A companion bill has also been introduced in the house by Reps. Blaine Luetkemeyer (R-Mo.) and Brad Sherman (D-Calif.).