This past week, the House passed the National Defense Authorization Act which included several bills of relevance to credit unions. The most pressing of which were in relation to cannabis banking businesses and the NCUA’s push for third-party vendor authority.
On the former, the bill further protects credit unions’ right to work with cannabis businesses, should they be operating in a state where marijuana is legal. The amendment to the bill was introduced by Representative Ed Perlmutter (D-CO) with the intent of offering regulatory protections to financial institutions on this front.
Despite it passing in the House, the bill will first need to be approved by the Senate, where it was previously rejected from a similar defense bill. Perlmutter however, is eager to ensure the amendment is included in the final bill this time around, as he expected to retire from the House after this year.
“It’s time to get this done—and I will pursue any and all legislative avenues to do so…This is yet another opportunity for the Senate to advance common sense cannabis reforms starting with access to the banking system,” he stated. “I’m calling on them to take action for the safety of our communities and the success of Veteran- and minority-owned businesses across the country.”
In addition to cannabis banking measurements, the bill also granted the NCUA the authority over third-party vendors it has been seeking for quite some time. The movement has been opposed by many credit union organizations who argue that the authority is unnecessary and simply adds increased regulatory burdens to the NCUA, credit unions, and vendors alike.
Brad Thaler, NAFCU’s Vice President, previously spoke out against additional vendor authority for the NCUA, arguing they already had the means to gather the information they needed on any vendors and that the supervision would increase their expenses which ultimately, would be placed on credit unions.
“NAFCU believes in a strong NCUA, but we also believe that the NCUA should stay focused on where their expertise lies—regulating credit unions,” wrote Thaler.
The bill included a few more amendments related to credit unions as well. It extended the pandemic-related changes to the NCUA’s Central Liquidity Facility as well as established a grant program for states, nonprofit organizations, and higher education institutions to promote diversity in the appraisal industry.
From here, the bill goes onto the Senate for approval.