Two executives from Wisconsin credit unions told lawmakers that the new regulatory burdens are so heavy that credit unions are forced to spend more on compliance costs, which results in members having to pay more.
“The regulatory pendulum has swung so far that financial institutions are faced with eliminating services or charging for them to offset the cost and increased regulatory burden of providing them,” Mark Willer, the COO at Royal Credit Union, said, CUTimes.com reports. “Many of the new regulations are intended to address abuses in the financial marketplace, or prevent unethical financial practices that harm consumers. Yet, I would challenge any member of this committee to find a single local community credit union or community bank that has been accused of such practices.”
Willer spoke before the House Financial Services Subcommittee on Consumer Credit and Financial Institutions during a field hearing held in Wausau, Wisconsin, on Monday. With him was Patricia Wesenberg, Central City CU’s president and CEO.
During her testimony, Wesenberg said that the “barrage of regulations creates an unnecessary burden without any measure of the effectiveness of these changes,” according to CUTimes.com. “They are costly, both in time and personnel to implement, and they are confusing to our membership.”
Wesenberg said that additional rules currently being written by the Consumer Financial Protection Bureau will cost the credit unions even more in compliance costs.