JOINT FAVORABLE REPORT
AN ACT CONCERNING REVISIONS TO VARIOUS CONNECTICUT BANKING STATUTES.
Joint Favorable Substitute
SPONSORS OF BILL:
Banking committee; Department of Banking
REASONS FOR BILL:
Not all of Connecticut's current banking regulations are 100% compliant with federal regulations. This bill makes technical changes to state statutes to make them compliant with federal regulations. The bill clarifies that Connecticut credit unions must comply with federal requirements for filing their quarterly call reports by aligning volume look-back periods of time with quarterly mortgage call reports.
The bill also makes technical changes to various Department of Banking statutes. These corrections are necessary to comply with federal law and recently enacted state law. The technical corrections incorporate other bills brought before the banking committee as follows:
● The bill works to ensure that the Connecticut Truth-in-Lending (TILA) act incorporates all required substantive provisions and regulations of TILA. Connecticut is one of a handful of states that have been granted an exemption from TILA because our requirements are very similar to federal regulations. (Originally SB 921).
● The bill also updates the consumer collection statutes to incorporate new sections enacted in 2014. The bill prohibits consumer credit reporting agencies from charging certain protected persons, such as victims of identity theft and senior citizens, fees related to security freezes. (Originally SB 6804).
● The bill also clarifies reporting obligations of Connecticut credit unions, to permit mailing methods other than registered or certified mail, to establish deadlines for the submission of annual audits, and to update the “home banking” statute to reflect technological changes in the provision of banking services. (Originally SB 922).
RESPONSE FROM ADMINISTRATION/AGENCY:
Bruce Adams, Acting Commissioner, Department of Banking
The Department of Banking strongly supports this proposal that conforms Connecticut's truth-in-lending laws to substantive provisions of the federal Truth-in-Lending Act because Connecticut is one of a small handful of states that have been granted an exemption from certain provisions of federal TILA. This exemption allows the Department to continue to protect Connecticut consumers in many of their loan transactions.
The department is also in favor of making technical changes to a number of separate statutes changed in this bill. These changes and clarifications will allow the Department of Banking to function more efficiently and clarify its role in relation to other regulatory agencies.
NATURE AND SOURCES OF SUPPORT:
Connecticut Bankers Association
The Connecticut Bankers Association requests that the bill also define a reasonable amount of time for a depositor to report unauthorized check transactions after receiving their monthly statement. The C.B.A. suggests 60 days may be an appropriate amount of time. These agreements are included in nearly all deposit account contracts in the United State but a recent Trial Court ruling in Connecticut found that these agreements violated UCC Section 42a-4-103. This decision runs contrary to other parallel courts' decisions. The Federal Government has similar provisions in the Truth in Lending Act and Electronic Funds Transfer Act. The C.B.A. also asserts that fraud will balloon without such a provision
NATURE AND SOURCES OF OPPOSITION:
None expressed. (For substitute SB 924)
Reported by: Sara LeMaster