OAK HARBOR, Ohio (3/29/13)--Commodore Perry FCU's decision to withdraw its appeal of a National Credit Union Administration examination "was based, in large part, on the belief that the needs of the industry were more important than the CAMEL scores were to us," said Commodore Perry FCU CEO Thomas Renz Thursday.
"Our hope is that by extending an olive branch, so to speak, the NCUA will allow us to work with them to share what we have learned in a positive way to strengthen a critical process," Renz told News Now Thursday in an e-mail.
The Oak Harbor, Ohio-based, $32 million asset credit union had contested the results of a 2011 examination in which it received its lowest CAMEL rating ever. It maintained the low rating was retribution after it reported the conduct of an examiner and that the final examination contained factually incorrect findings. However, NCUA received a letter from Renz on Tuesday withdrawing the appeal.
"It is our absolute desire to work with the NCUA to share what we have learned," he said, noting that CPFCU "has never considered this to be a personal fight, but we do have a moral obligation to protect our staff and members." He believes the credit union would have succeeded if it had taken the appeal further. Given that, "we hope that our willingness to withdraw demonstrates how serious we are about our desire to work positively to improve the process."
The credit union is "working with the Ohio Credit Union League and the Credit Union National Association now and over the course of this year" he said, noting NCUA Region III Director Herb Yolles "has been very professional and willing to listen. We hope to continue discussions with him and will be contacting the NCUA offices in Washington to set a meeting to discuss some of these issues in the near future."
Although NCU does its best to responsibly govern the credit union industry, Renz told News Now, "no organization is perfect and so we must strengthen due process protections to ensure that when something goes wrong there is a meaningful and reasonable path for a credit union to take to remedy that problem."
Credit unions in similar situations must consider two things, he said. "First, ask yourself if you are right. If the NCUA is telling you there is a problem with your credit union and you have a 5% capital ratio, they are probably right and you will simply waste your time trying to fight them."
"Second, look at the cost/benefit," he said. "The process as it stands is broken…. Until the process is strengthened, this is a fight that will almost always end up being cost prohibitive."
The withdrawal doesn't mean the credit union is done or dropping the issue. It "is actually a relatively risky demonstration of good faith meant to move the issues we are fighting for forward. You may think you have a good examiner and this issue is not that important to you, but remember due process rights are rarely important to good people or organizations until they need them," Renz said.
"I hope that what has occurred so far will act as a call to action for both credit unions and the NCUA to take a hard look at the examination and appellate process and ensure credit union rights are protected," he concluded.
Both CUNA and the Ohio league told News Now Wednesday they will work with the credit union to seek improvements in the examination appeals process (News Now March 28).