The Independent Community Bankers of America (ICBA) President and CEO Rebeca Romero Rainey has responded to the Consumer Financial Protection Bureau's (CFPB) recent action against VyStar Credit Union. The CFPB penalized VyStar following issues arising from its transition to a new online banking platform in May 2022, which led to significant consumer disruptions. According to the CFPB, members faced difficulties in performing basic banking functions for weeks, with some features remaining unavailable for over six months. Consumers were unable to manage accounts effectively, incurred late fees due to failed online bill payments, and often could not access their funds.

"Today’s Consumer Financial Protection Bureau penalty against VyStar Credit Union for harming consumers via a failed rollout of a new online system exemplifies the risks posed by the National Credit Union Administration’s inability to examine credit union third-party service providers," stated Romero Rainey. She highlighted that while the CFPB ordered VyStar to compensate affected consumers and imposed a $1.5 million civil penalty, there is a need for policymakers to empower the National Credit Union Administration (NCUA) with authority similar to bank regulators concerning cyber risk supervision.

NCUA Chairman Todd Harper has previously identified this lack of authority as a "regulatory blind spot," noting that it leaves the agency unaware of cybersecurity happenings within credit unions. He pointed out incidents involving third-party service providers affecting numerous credit unions' operations and breaches compromising personal information of over one million members due to ransomware attacks.

Romero Rainey expressed concern over regulatory oversight deficiencies amidst increasing acquisitions of tax-paying community banks by tax-exempt credit unions, setting a record for 2024. Bipartisan legislation introduced in previous Congress sessions aims at granting NCUA similar supervisory powers as bank regulators regarding cyber risks. This initiative has backing from NCUA's Harper, inspector general, Government Accountability Office, and Financial Stability Oversight Council.

She also referenced ICBA polling conducted by Morning Consult indicating that 61% of U.S. adults believe Congress should investigate whether credit unions should acquire banks given their tax and regulatory exemptions. Romero Rainey called on lawmakers to revisit outdated policies impacting consumers and local communities adversely.

The ICBA advocates creating an environment conducive for community banks through advocacy, education, and innovation efforts aimed at economic prosperity.