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Recent reporting of cyber instances to the NCUA demonstrates the urgent need for the agency to have examination and supervisory powers over credit union third-party servicers, NCUA Chairman Todd Harper said Thursday.
In the first 30 days after the NCUA adopted a new cyber reporting rule, credit unions reported 146 cyber incidents, Harper revealed at the board’s monthly meeting, adding that the agency in the past has received that number annually.
Of the total, 60% of those reported dealt with third-party servicers, he said.
Risks Involved
“Stakeholders must understand that the risks resulting from the NCUA’s lack of vendor authority are real, expanding, and impact all of us,” Harper stated.
The NCUA has asked Congress to restore the vendor authority it once had, with board members pointing out that among banking regulators, the NCUA is the only agency without such authority.
“Restoring the NCUA’s vendor authority would bolster our national economic security and save time and money in the long term,” Harper said. “It’s just common sense and good business.”
Credit Union Opposition
Credit union trade groups have opposed granting the agency that power, however. On Thursday, as the Senate Banking Committee held a confirmation hearing on the nomination of Tanya Otsuka to be a member of the NCUA board, CUNA and NAFCU sent a letter to committee members outlining their priorities.
In the letter, the two trade groups reiterated their opposition to giving the NCUA third-party vendor power saying, among other things, that they feared the move would require the agency to hire additional people, with an accompanying budgetary increase.
Other Business
The NCUA board unanimously approved a notice of proposed rulemaking intended to simplify share insurance regulations by establishing a “trust account” category that would provide for coverage of funds of both revocable and irrevocable trusts deposited at federally insured credit unions. The proposal also would make other technical changes that would align NCUA regulations with those of the FDIC.
The board also approved a proposed rule that would make it easier for credit unions to hire people who have been convicted of minor criminal offenses.
NCUA
