League Opposes Senate Bill S.4698, The Improving Cybersecurity of Credit Unions Act

Your League is strongly opposed to a proposed Senate bill which would grant the NCUA examination authority over CUSOs and third-party vendors and is advocating against its advancement.

The bill, S. 4698 - The Improving Cybersecurity of Credit Unions Act, would allow the NCUA the same examination scope and authority over CUSOs and vendors as they have over credit unions. We don’t believe this legislation is necessary, as NCUA has exercised effective regulation of these entities for years without this authority. The bill would result in additional unnecessary regulatory burden for credit unions, as well as financial costs through higher operating fees to NCUA and possibly from vendors. NCUA has not presented a clear vision for how this new authority would be implemented, making it impossible to estimate the financial and operational burden this would place on credit unions.

While this Senate bill is the latest iteration, the League has continually opposed expansion of the NCUA’s examination authority to third parties at both the House and the Senate level. This week we submitted a letter of opposition to Senator Warner reiterating our concerns. Read the full letter here. 

CUNA, NAFCU, and other credit union Leagues have also come out in opposition against the bill.