Cyber Security, Housing Market, Regulation

CUNA urges lawmakers to advance housing finance, data security reforms

CunaThe Credit Union National Association urged Congress on Wednesday to press forward on housing finance and data security reform.

CUNA sent letters to House Financial Services Committee Chairman Rep. Jeb Hensarling (R-Texas), Ranking Committee Member Maxine Waters (D-Calif.), Senate Banking Committee Chairman Tim Johnson (D-S.D.) and Ranking Committee Member Michael Crapo (R-Idaho).

CUNA President and CEO Bill Cheney said in a letter to the Senate that housing finance reforms are necessary as the U.S. economy continues its fragile recovery and the housing market continues to improve.

“As you contemplate new legislation in this area, it is critical that credit unions have equitable access to a functioning, well-regulated secondary market,” Cheney said. “Equally important, new legislation should preserve the government guarantee of mortgages sold into the secondary market so that small lenders may continue to offer mortgage products with predictable payments, like the 30-year fixed rate mortgage.”

CUNA also urged the lawmakers to hold additional hearings on data security, adding that policymakers need to address regulatory inconsistencies between financial institutions and merchants.

Several merchants announced in recent months that consumers’ personal information had been compromised after cyberattackers breached data systems. Cheney said that while financial institutions are subject to security standards under the Gramm-Leach-Bliley Act, merchants are not subject to the same standards.

“A prime reason that merchant data breaches are a chronic issue is because data security standards are inconsistent among the participants in that system,” Cheney said in a letter to the House. “While we welcome the discussion, the pursuit and the deployment of new technology in the payment system, we are very skeptical that a solution to merchant data breaches can be achieved without first addressing this inconsistency and requiring all participants to follow similar data security standards. Until and unless merchants are held accountable for the damages that breaches to their systems cause financial institutions and consumers, we have little confidence that they will be incentivized to properly secure their systems.”

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