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Washington Weekly: CFPB’s Future and the Impact of CDFI Cuts on Credit Unions | PYMNTS.com

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Washington Weekly: CFPB’s Future and the Impact of CDFI Cuts on Credit Unions | PYMNTS.com


By the standards set previously in Q1, this Monday wasn’t as manic as most. In fact there’s an element of “business as usual” in this installment of the Washington Weekly as CFPB workers were called back to work. But the general atmosphere of business uncertainty continues to hang over the nation’s capital as well as the companies following the Trump administration’s continuing navigation of trade finance and domestic financial regulations.

The top story for Karen Webster and QED Investors partner Amias Gerety was the continuing drama around the Consumer Financial Protection Bureau (CFPB). As The New York Times (NYT) reported Saturday (March 15), last week, the watchdog’s consumer response team was summoned back to the office to deal with a backlog of 16,000 complaints. In addition, the report said, the CFPB’s Fair Lending Office is back to preparing its annual report to Congress. And the front page of the agency’s website, which showed a “404 error” message beginning on the day Trump officials arrived at the bureau, is functioning once more.

The question now: What’s next for the CFPB? Gerety, a former assistant secretary of the treasury under Obama, believes the developments of the past week are good for the American consumer and a sign that the administration is taking its responsibilities to keep the agency operating seriously. While there’s a “wait and see” element to Gerety’s view of the CFPB, Webster noted that there’s a lot more hanging in the balance for the agency than just dealing with consumer complaints.

Gerety emphasized ambiguity remains about broader rulemaking and enforcement until a new director is confirmed by the Senate. The incoming leadership could swiftly alter or delay previously enacted regulations, given the Supreme Court’s directive that the agency follow rigorous rulemaking procedures. Gerety offered pragmatic advice to FinTech companies navigating this ambiguity, stressing the importance of maintaining robust compliance standards despite potential regulatory shifts.

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“Even as the compliance obligations may be lessened, that actually puts more pressure on you to be operating in good faith relative to your consumers,” Gerety said. “We’re telling people it’s a little bit easier on compliance, but harder on risk.” Until the CFPB’s direction becomes clear, Gerety advises caution, noting, “You can’t follow the policy prescriptions. You have to follow the rules, because that’s the part that has legal force.”

He noted that the confirmation of CFPB director nominee Jonathan McKernan, expected imminently, is likely to be a smooth process and could rapidly clarify the agency’s path forward. “I expect his confirmation to go smoothly,” Gerety said. “He said the right things about following the law,” emphasizing that swift confirmation would help stabilize the agency and resolve uncertainty around pending regulations.

Big Hit to Credit Unions

While the CFPB may have a reprieve, the same cannot be said about the Community Development Financial Institutions (CDFI) Fund. It was the target of a new executive order from President Trump last week. Established in 1994 as a bipartisan Treasury Department initiative, the fund promotes economic opportunity in underserved communities by supporting mission-driven financial institutions that provide capital and services to individuals and businesses often overlooked by traditional banks. Prior to the recent executive order, the Fund had awarded over $5.1 billion through various monetary award programs and $66 billion in tax credits through its New Markets Tax Credit Program, helping finance over 109,000 businesses and 45,000 affordable housing units in fiscal year 2024. On Friday (March 14), the president  signed an executive order directing the CDFI Fund to be “eliminated to the maximum extent consistent with applicable law” and to “reduce the performance of their statutory functions and associated personnel to the minimum presence and function required by law,” deeming it “unnecessary” alongside six other federal agencies, despite bipartisan congressional support for the program.

As Webster and Gerety discussed, the EO has implications beyond the federal grant program. It has substantial implications for credit unions across the United States. As of January 2025, 495 certified CDFI credit unions serve millions of members in economically distressed areas, and these institutions now face considerable uncertainty regarding funding streams and operational support, according to the fund’s website.

Gerety expressed concern about the recent executive order targeting the CDFI Fund, emphasizing its crucial role in aiding credit unions and community-focused financial institutions nationwide. He explained that nearly 10% of U.S. credit unions hold CDFI certification, leveraging the fund’s grants, subsidies, and affordable housing loans to effectively serve low-income and minority communities.

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Gerety described the CDFI Fund as a straightforward, transparent mechanism whose impacts are easily measured, stressing, “It’s super transparent. It’s really easy to track the impact. And we’ve seen the impact now over 30 years transform communities.” He detailed how the fund consistently distributes loans and grants directly to community-oriented financial institutions, driving tangible outcomes. In 2024 alone, CDFI-backed institutions provided funding to 109,000 small businesses and supported the development of approximately 45,000 affordable housing units through $24 billion in community-focused loans and investments, according to Gerety.

The Uncertain Vibe

So it was a Monday in D.C. to be sure. Has it changed the general vibe in Washington? For consumers? Has it changed the general vibe for fintechs and banks? Let’s take the last issue first. Maybe the actions in Washington haven’t directly impacted FinTechs this week. But Klarna’s IPO filing last Friday (March 14) has had a positive effect, Gerety said. (Full disclosure: Gerety’s company, QED Investors was an early stage investor in Klarna but is no longer actively involved.)

“This is great news for FinTech,” he told Webster. “And I think the other thing that’s really interesting with Klarna is they have shifted the mindset in Europe for their customers. Not just to be a way for people to pay, but also a way for people to discover. And I think that that change in consumer behavior is a real testament to the team there. It’s interesting timing given the market term turmoil, but strong businesses that want to be public can survive turmoil in the market.”

And regarding the general vibe in Washington this week? Still uncertain, according to Gerety.

“Maybe you’re in a business where you manufacture with steel. Well, are the tariffs on or off? When are they coming? Should you build a plant here or somewhere else? You don’t know,” he said. “And when you put all that together the right thing to do is just to pause. And unfortunately for the economy, a pause is deadly.”

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Aviation safety bill based on DC midair collision faces House vote Tuesday

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Aviation safety bill based on DC midair collision faces House vote Tuesday


An aviation safety bill seeking to address lessons learned from last year’s midair collision of a jet with an Army helicopter near the nation’s capital is up for a vote Tuesday evening in the House, but key senators and the families of the 67 victims think the bill needs to be strengthened.

The House bill, called the Alert Act, has the backing of key industry groups. The National Transportation Safety Board said recently that the legislation, since amended, now addresses its recommendation to require all aircraft flying around busy airports to have key locator systems that let pilots know more precisely where other aircraft are flying around them.

The NTSB has been recommending the new technology systems since 2008, and Chairwoman Jennifer Homendy has said such a system would have prevented the collision of the American Airlines jet and Army Black Hawk helicopter that sent both aircraft plunging into the icy Potomac River.

Two key House committees unanimously advanced the bill last month. The bill is now being brought up for a full House vote under rules that won’t allow any amendments. But victims’ families said they want to make sure the bill has strict timelines to guarantee the reforms will be completed. And they worry the House bill would allow military flights to continue flying without broadcasting their locations on routine training flights and not just secret missions.

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“January 29, 2025 made clear what is at stake. The 67 lives lost that day should be honored with an improved system that prevents this from happening again,” the main families group said Tuesday in a new statement. “And the flying public should not have to wait longer than necessary for those protections to be in place.”

Sponsored by Republican Sam Graves and Democrat Rick Larens, the legislation needs to secure two thirds of House support to advance to the Senate. Separate legislation called the ROTOR Act that the Senate crafted came up one vote short in the House. Senators Ted Cruz and Maria Cantwell have also said the Alert Act still needs to be improved.

Earlier this year, the NTSB’s Homendy sharply criticized the original version of the bill as a “watered down” measure that wouldn’t do enough to prevent future tragedies. But the board said the revised version would now address the shortcomings their investigation identified and require the Federal Aviation Administration, Transportation Department and the military to take needed actions.

National Transportation Safety Board members at a hearing in late January were deeply troubled over years of ignored warnings about helicopter traffic dangers and other problems, long before the collision.

Everyone aboard the American Airlines jet, flying from Wichita, Kansas, and the helicopter died when the two aircraft collided. It was the deadliest plane crash on U.S. soil since 2001, and the victims included 28 members of the figure skating community.

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A helicopter route in the approach path of a Reagan National Airport runway didn’t ensure enough separation between helicopters and planes landing on the airport’s secondary runway, and the route wasn’t reviewed regularly, the board said. The poor design of that route was a key factor in the crash along with air traffic controllers relying too much on pilots seeing and avoiding other aircraft.

The bill now requires planes to have Automatic Dependent Surveillance-Broadcast In systems that can receive data about the locations of other aircraft. Proponents of the use of such systems said they would have alerted the pilots of an American Airlines jet sooner about the impending collision with the Black Hawk helicopter. Most planes already have the complementary ADS-B Out systems that broadcast their locations.

The NTSB cited systemic weaknesses and years of ignored warnings as the main causes of the crash, but Homendy has said that if both the plane and the Black Hawk had been equipped with ADS-B In and the systems had been turned on, the collision would have been prevented. The Army’s policy at the time of the crash mandated that its helicopters fly without that system on to conceal their locations, although the helicopter involved in this crash was on a training flight, not a sensitive mission.



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Fred Hutch funds 10 Washington state initiatives to expand cancer prevention

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Fred Hutch funds 10 Washington state initiatives to expand cancer prevention


Fred Hutch Cancer Center’s Community Grants Program has recently awarded 10 cancer prevention projects across Washington state up to $15,000 each, for a total of $145,500. These dollars will support community-led solutions for cancer prevention, screening and education, particularly for historically underserved populations.

Since it began in 2014, the Community Grants Program, overseen by Fred Hutch’s Office of Community Outreach & Engagement (OCOE), has awarded 71 grants totaling nearly $700,000. 

Record interest highlights growing need

This 2026-2027 grant cycle drew a record number of project proposals for the second year in a row, reflecting both a growing awareness of the program and the continued need for locally driven cancer prevention initiatives. 

The awardees come from all regions in Washington state, ranging from Whidbey Island in the west to the Spokane region in the east to the Yakama reservation in Central Washington.

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The year’s funding focuses on projects designed to address socio-economic drivers of health, or SDOH, such as housing instability and transportation access. 

“When you’re worried about paying rent or finding transportation, getting a cancer screening is often the last thing on your mind,” said Katie Treend, MPH, community benefit manager for OCOE. “That’s why these projects are so important — they support cancer prevention and whole-person health by meeting people where they are at.” 



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Soo Yon Ryu Publishes in the Journal of Advertising

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Soo Yon Ryu Publishes in the Journal of Advertising


Soo Yon Ryu, assistant professor of business administration at Washington and Lee University, recently published a research article in the Journal of Advertising.

Ryu’s paper, “Simple is Eco-Friendly but Complex is Effective: Inferences from Visual Complexity in Package Design,” found that people interpret the complexity of a product’s packaging as a cue for both environmental friendliness and product effectiveness. Consumers tend to prefer simple package designs when eco-friendliness is important, as less complex designs signal lower resource use. Conversely, they favor more elaborate designs when they focus on product effectiveness, interpreting complexity as a sign of higher quality or stronger performance.

The research’s findings offer managers valuable insight on how strategically adjusting the visual complexity of product packages can influence consumer perception.

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Ryu is in her first year as a faculty member at W&L. She earned a dual bachelor’s degree in business administration and culture & design management from Yonsei University (South Korea), a Master of Arts in art management from Seoul National University and a Ph.D. in marketing from the University of Florida, where she was recognized with the Warrington College of Business Ph.D. Teaching Award and a Marketing Science Institute Research Grant.

If you know a W&L faculty member who has done great, accolade-worthy things, tell us about them! Nominate them for an accolade.



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