AFSA Comments on NDAA
Yesterday, AFSA submitted a comment letter to the Chairs and ranking Members of the House and Senate Armed Services Committees outlining its position on several provisions of the National Defense Authorization Act (NDAA) for Fiscal Year 2023 (S. 4543 and H.R. 7900).
The NDAA sets the annual budget and spending priorities of the Department of Defense. AFSA has been commenting on the legislation each year to ensure that servicemembers’ access to safe, responsible consumer credit is maintained and strengthened. AFSA specifically commented on six provisions of the bill.
AFSA supports the Safe Banking Provisions passed overwhelmingly by the House last year and asks that the bipartisan bill be included as part of the NDAA. The SAFE Act prohibits a federal banking agency from terminating a banking relationship unless there is a valid reason to do so. The Act specifically puts an end to Operation Chokepoint, which reduced the consumer credit options consumers had.
AFSA supports Section 591, which expands the use of remote online notarization (RON) technology, making it faster and easier for servicemembers to sign and review documents.
AFSA opposes Section 5892 which prevents servicemembers from accessing pre-dispute arbitration services and favors class action lawsuits. The Consumer Financial Protection Bureau’s (CFPB) own 2015 study found that arbitration costs consumers less, is far quicker than class actions, and results in higher monetary relief; the average in arbitration is $5,389 versus class-action lawsuits at just $32.
AFSA opposes Section 5450, which creates a duplicative ombudsman at the CFPB focused specifically on credit reporting errors. The United States benefits from one of the best and most robust credit reporting systems in the world. AFSA feels strongly that any errors in reporting be fixed immediately, and improvements or modifications can be made to ensure this outcome. Creating an additional office, when the Office of Servicemember Affairs (OSA) at the CFPB already exists, will make the process more confusing for servicemembers.
AFSA opposes Section 5413, which requires small businesses to collect and report demographic data to the Bureau. Such a program requires the implementation of new data privacy policies and procedures, systems, and software. To comply with the rule would necessitate a massive effort and investment, putting a strain on businesses that are already struggling due to pandemic and supply chain issues.
AFSA opposes Section 5436, which restricts servicemembers and their families from accessing the full variety of available credit products because it requires use of less accurate credit data. Moreover, servicemembers that do qualify for credit may have to borrow with higher costs. AFSA strongly supports protections and access to credit for servicemembers; an accurate credit reporting system assures both.
AFSA will continue to work with Congress on policies to help ensure access to consumer credit and financial services for all consumers, including those in the military.
August 17th, 2022 by Dan Bucherer
