WASHINGTON – The House Financial Services Committee yesterday unanimously approved legislation that would ease a duplicative ATM disclosure requirement that has left ATM services providers vulnerable to nuisance lawsuits. CUNA President/CEO Bill Cheney said the committee approval was "a big step toward rectifying a problematic case of regulatory redundancy."
The bill (H.R. 4367) would eliminate portions of Regulation E that require credit unions and other financial institutions that provide ATM services to display a physical notice that a transaction fee will be charged. Under the legislation, ATMs would only be required to display the disclosure on a screen, and give users the choice of opting in to such a fee.
CUNA has stressed that existing ATM disclosure requirements are creating issues for credit unions and other financial institutions that continue to be subjected to frivolous lawsuits.
Credit unions are spending around $2,000 per ATM to simply comply with the physical notice requirement. Many have been subjected to legal action and are settling lawsuits to avoid the cost of litigation.
Cheney thanked the committee for responding positively to CUNA's arguments about the need to fix this problem and spare credit unions from duplicative costs that provide no added benefit to consumers.
"The fact is that on-screen disclosures have eliminated the need for a physical notice on ATM machines. The bill passed by the House Financial Services Committee is a common-sense solution that will alleviate an unnecessary compliance burden and reduce instances of baseless litigation," Cheney added.
A House roll call vote on the bill, which has 134 co-sponsors, could come soon after Congress returns from the planned July 4 district work period. Committee members said that they hoped the bill could be moved on to the Senate quickly.
CUNA is already working with senators and their staff to develop a plan for getting this legislation through the upper house as quickly as possible.
CUNA will continue to press Congress to enact this bill as quickly as possible, Cheney said.