The Compliance Paradox of Deregulation

April 15, 2026

By Josh McAfee, Vice President of Services

At first blush, the reduction of regulatory requirements may sound like a dream come true. Yet often, the reverse is true.

As US policymakers and credit union industry regulators scale back certain requirements, credit union compliance teams are confronting an entirely new set of questions.

A few on the radar now:

The NCUA’s “Deregulation Project”: The agency has proposed rule changes designed to remove obsolete provisions, simplify CU governance requirements or eliminate duplicate rules. For example, references to disparate impact were removed from the NCUA’s Fair Lending Guide in the fall of 2025. As a result, exams will no longer include reviews for disparate impact. 

For its part, FinCEN has begun easing certain customer due diligence requirements. For example, recent changes to beneficial ownership rules reduce the need to repeatedly verify ownership information once it has been collected.

These moves and many others like them represent more than a short-term trend. They reflect a broader regulatory posture as agencies respond to the current administration’s push to ease perceived burdens. While a new administration may someday roll back the rollbacks, for the moment, compliance teams can expect a steady cadence of deregulatory activity over at least the next two years.

For many teams, the challenge isn’t just the changes, but the volume of them. With multiple rounds of proposals from multiple sources, compliance leaders are working just as hard today as they do during a steady stream of new requirements.

Mindfully Managing Risk Beyond the Rulebooks

When faced with deregulatory matters, credit unions have several decisions to make, including:

Whether to Change or Maintain Internal Controls

It’s important to consider that even when a regulatory requirement goes away, the underlying risk may not. Credit unions may choose to leave certain policies and procedures in place to maintain the appropriate level of protection. As people-centered organizations, credit unions could decide that members are better served by maintaining higher standards.

So long as a deregulation move doesn’t explicitly prohibit it, credit unions have the flexibility to maintain stronger standards where risk warrants. It’s also worth considering that keeping policies and associated staff training current makes it easier to ramp back up if requirements return or come back even more stringent.

If Cost Savings Are Real or Perceived

To date, most rollbacks have not translated into meaningful savings. Some proposed changes, however, like the NCUA’s plan to remove its “refund of interest” rule, could empower credit unions to limit blanket refund practices. By instead following a case-by-case strategy, credit unions could reduce unnecessary payouts, as well as lighten the lift on processing and reporting.

Still, those cost savings may not exist in a vacuum. It’s important to keep in mind that deregulation in one area may be offset by increased scrutiny in another, requiring teams to monitor regulatory changes across multiple agencies.

How Quickly to Implement New Procedures

Moving too fast can create unintended compliance gaps or introduce new risk. A more measured approach gives credit unions time to consult across functions, including the risk management team, to anticipate downstream effects. As prescriptive rules fall away, risk teams are playing a larger role in interpreting what any changes the credit union chooses to make may mean in practice.

Process and technology improvements can help strike a balance between speed and soundness. Automated workflows and centralized information hubs, for example, enable controlled policy and procedures changes while also capturing key decisions and maintaining clear records. This level of visibility is critical as executives, boards and examiners increasingly expect strong documentation, accountability and a clear line of sight into how policy changes are implemented and managed.

During Deregulation, Clarity Becomes Its Own Control

Perhaps counterintuitively, fewer rules can create more complexity. That’s because deregulation often shifts the work from checking boxes to making judgment calls. The credit unions that navigate this moment most effectively will be those that keep decisions organized and visible, ultimately enabling them to act as thoughtful stewards of member trust.

Originally published in CUInsight on April 6, 2026.