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Defense authorization would require MLA study
A provision requiring the Department of Defense to delay
implementation of proposed Military Lending Act rule changes was
included in a defense authorization bill released Monday by House Armed
Services Committee Chairman Mac Thornberry, R-Texas.
The study
would have to show the impact on troop readiness from access to and use
of various financial products, including payday loans and installment
loans. The MLA rule review would have to summarize the comments
received regarding the proposal and their disposition. It would address
the staffing, funding and integrity of the Defense Manpower Data Center
(DMDC) database, which all creditors would be required to use to check
the potential active-duty military status of virtually every person
submitting a credit application under the proposed rule changes.
The
study report would be due to Congress March 1, 2016. DoD would be
barred from implementing this or undertaking related rulemaking for 60
days following Congress' receipt of the report.
The committee will mark up the legislation Wednesday.
The proposed rule was issued last year, and NAFCU lodged serious concerns
about its impact on credit unions and credit union members. The
association has been engaged with DoD rule writers throughout the
rulemaking process.
"NAFCU has always supported protecting
servicemembers from unscrupulous predatory lenders, but it's important
that any rules affecting access to credit be approached in a very
deliberate fashion," said NAFCU Military Liaison Quincy Enoch. "Credit
unions have always provided servicemembers the best financial services,
and we are focused on ensuring their ability to keeping doing that isn't
negatively impacted."
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