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FAST Act Signed Into Law: Annual Privacy Notices No Longer Required

Credit unions have some needed regulatory relief with the passage of the Fixing America’s Surface Transportation (FAST) Act, a five-year, $305 billion highway funding package that includes three key provisions affecting credit unions.  

Most importantly for Missouri’s credit unions, the FAST Act contains a privacy notice provision based on H.R. 604, the Eliminate Privacy Notice Confusion Act. The privacy notice bill was introduced in three consecutive terms of Congress by Missouri U.S. Rep. Blaine Luetkemeyer (R-District 3) and U.S. Rep. Brad Sherman (D-CA). The provision changes privacy notification requirements so financial institutions are required to send privacy notifications only when the privacy policy is changed. It was previously required every year, regardless if a change occurred or not.  

“I am incredibly pleased this common-sense piece of legislation of eliminating redundant mailings made it across the finish line this year," says Rep. Luetkemeyer. "With this legislation now enacted into law, costs that used to be passed along to customers of credit unions and other financial institutions are a thing of the past, and consumers will have a better idea of changes to privacy standards when they occur. I would like to thank the Missouri Credit Union Association for their unwavering support of this legislation.”

Another provision directs the Consumer Financial Protect Bureau (CFPB) to establish a process for determining whether an area should be designated as “rural,” which could impact the products credit unions offer. The package also contains a provision that allows privately insured credit unions to join the Federal Home Loan Bank (FHLB) program.  

The House passed the bill on December 2, with a 359-65 vote, and the Senate followed suit with an 83-16 vote on December 3. President Obama signed it into law on December 4, 2015.

The Missouri Credit Union Association (MCUA) and the Credit Union National Association (CUNA) have worked with Rep. Luetkemeyer on the privacy notice provision since it was first introduced.
 
“We are extremely grateful to Congressman Luetkemeyer and his staff for the steadfast efforts and support of this regulatory relief concern,” says Amy McLard, MCUA SVP of Advocacy. “This much-needed change will allow Missouri credit unions to redirect funds spent on these privacy notices back to their members, where it can be put to good use.”