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House Financial Services Subcommittee Chairman Blaine Luetkemeyer, R-Mo., told regulatory agencies in a letter yesterday that their issued guidance should not be held by examiners as "binding obligations on the institutions they supervise." He urged that this trend of "regulation by enforcement" be reversed – a point NAFCU has also stressed with regulators, especially the CFPB.

Luetkemeyer, chairman of the Financial Institutions Subcommittee, asked that each agency – the FDIC, Comptroller of the Currency, NCUA, Bureau of Consumer Financial Protection (BCFP) and Securities and Exchange Commission – issue and publish a clear statement that guidance documents, such as supervisory letters or exam manuals, that have not gone through the rulemaking process do not establish binding standards.

In his letter, Luetkemeyer also asked that examiners be properly training in the "use and role of guidance."

"Taking these steps will help ensure that the law is observed in practice, and that regulated entities are aware of their rights and responsibilities, without having to wonder whether the line between guidance and rule remains blurred," he wrote. Luetkemeyer sent a similar letter to Federal Reserve Vice Chairman for Supervision Randal Quarles.

Congress has taken actions to rescind agency guidance that was never submitted as a rule. Most recently, both the Senate and House repealed the CFPB's 2013 bulletin regarding indirect auto lending using the Congressional Review Act (CRA). This was the first use of the CRA in this way, but Congress has indicated a willingness to look into other agency guidance documents to ensure they aren't being enforced the same way as a rule.

NAFCU will continue to follow this issue as part of the association's efforts to ensure broad regulatory relief for credit unions. Creating a positive regulatory environment for credit unions with appropriate and tailored regulations is part of NAFCU's 2018 advocacy priorities.