Improving Cybersecurity of Credit Unions Act

Bill: 117-s-4698
Sponsor: full_name: Sen. Ossoff, Jon [D-GA]
Introduced: 2022-08-01
Policy area: Finance and Financial Sector
Subjects: Banking and financial institutions regulation

National Credit Union Administration
Latest action: action_date: 2022-11-15
text: Committee on Banking, Housing, and Urban Affairs. Hearings held.

Summaries:
action_date: 2022-08-01
action_desc: Introduced in Senate
text: <p><b>Improving Cybersecurity of Credit Unions Act </b></p> <p>This bill subjects credit union organizations and third-party service providers to examination and regulation by the National Credit Union Administration to the same extent as insured credit unions. </p>

tv_txt: II 117th CONGRESS 2d Session S. 4698 IN THE SENATE OF THE UNITED STATES August 1, 2022 Mr. Ossoff (for himself, Ms. Lummis , and Mr. Warner ) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To amend the Federal Credit Union Act to modify requirements relating to the regulation and examination of credit union organizations and service providers.

1. Short title This Act may be cited as the Improving Cybersecurity of Credit Unions Act . 2. Findings Congress finds the following: (1) Until 2001, the National Credit Union Administration (referred to in this section as the NCUA ) maintained third-party examination authority over credit union organizations. (2) As of the date of enactment of this Act, other Federal and State bank supervisors maintain third-party examination authority over bank service companies pursuant to the Bank Service Company Act ( 12 U.S.C. 1861 et seq. ). (3) The Government Accountability Office, the Financial Stability Oversight Council, and the Inspector General of the NCUA have all requested the restoration of the NCUA’s third-party vendor authority. (4) As of the date of enactment of this Act, significant cybersecurity threats threaten credit unions and the economy of the United States. (5) By giving the NCUA examination parity with other Federal and State bank supervisors, and restoring third-party examination authority to the NCUA, this Act, and the amendments made by this Act, will protect credit union customers and strengthen credit unions against cybersecurity risks, privacy violations, and anti-money laundering concerns. 3. Regulation and examination of credit union organizations and service providers (a) In general The Federal Credit Union Act ( 12 U.S.C. 1751 et seq. ) is amended by striking section 206A ( 12 U.S.C. 1786a ) and inserting the following: 206A. Regulation and examination of credit union organizations and service providers (a) Regulation and examination of credit union organizations (1) General examination and regulatory authority A credit union organization shall be subject to examination and regulation by the Board to the same extent as an insured credit union. (2) Examination by other banking agencies The Board may authorize any of the following entities to make an examination of a credit union organization in accordance with paragraph (1): (A) Any Federal regulatory agency that supervises any activity of a credit union organization. (B) Any Federal banking agency that supervises any other person who maintains an ownership interest in a credit union organization. (b) Applicability of section 206 A credit union organization shall be subject to the provisions of section 206 as if the credit union organization were an insured credit union. (c) Service performed by contract or otherwise Notwithstanding subsection (a), if an insured credit union or a credit union organization that is regularly examined or subject to examination by the Board, causes to be performed for itself, by contract or otherwise, any service authorized under this Act, or in the case of a State credit union, any applicable State law, whether on or off its premises— (1) such performance shall be subject to regulation, examination, and enforcement by the Board to the same extent as if such services were being performed by the insured credit union or credit union organization itself on its own premises; and (2) the insured credit union or credit union organization shall notify the Board, in a manner and method prescribed by the Board, of the existence of the service relationship not later than 30 days after the earlier of— (A) the date on which the contract is entered into; or (B) the date on which the performance of the service is initiated. (d) Administration by the board The Board may issue such regulations and orders as may be necessary to enable the Board to administer and carry out this section and to prevent evasion of this section. (e) Definitions For purposes of this section— (1) the term credit union organization means any entity that— (A) is not a credit union; (B) is an entity in which an insured credit union may lawfully hold an ownership interest or investment; and (C) is owned in whole or in part by an insured credit union; and (2) the term Federal banking agency has the same meaning as in section 3 of the Federal Deposit Insurance Act. (f) Exercise of authority To minimize duplicative efforts, prior to conducting any examination of a credit union organization under the authority provided to the Board under this section, the Board shall first seek to collect any information which the Board intends to acquire through such examination from— (1) any Federal regulatory agencies that supervise any activity of that credit union organization; and (2) any Federal banking agency that supervises any other person who maintains an ownership interest in that credit union organization. . (b) Approval Any changes to the budget of the National Credit Union Administration Board as a result of the amendments made by subsection (a) shall be featured in a public hearing, subject to public comment, and approved by the Board.