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CUNA calls on NCUA to change CUSO governance plan
WASHINGTON 9/14/11)--Credit union service organizations (CUSOs) do not pose a risk to the credit union system nor do they pose overall concerns to the National Credit Union Share Insurance Fund and the National Credit Union Administration should withdraw--or at least substantially modify--its recently proposed additions to rules governing CUSOs, the Credit Union National Association (CUNA) said in a comment letter. The NCUA’s proposal, released in July, would require CUSOs and their subsidiaries to directly file their financial statements with the NCUA. Financial reports would also need to be forwarded to appropriate state supervisors under the rule. The agency has argued that the proposal, if enacted, would "enhance protections to consumers, credit unions and the National Credit Union Share Insurance Fund." While some CUSOs have had issues, CUNA said that CUSOs “as a whole do not pose a systemic risk to the credit union system or overall concerns to the NCUSIF.” The agency “has provided absolutely no data or analysis regarding current problems that could be used to substantiate the need for the proposal,” CUNA Deputy General Counsel Mary Dunn said in the comment letter. Dunn said that credit unions are extremely concerned about the proposed rule, and questioned whether the agency has the legal authority to take the steps presented in its proposed rule. “NCUA already has a number of options it can employ to ensure credit unions do not get into trouble by participating in a CUSO without having to adopt the CUSO oversight provisions in the proposal,” the CUNA letter stated. “Rather than issuing new requirements, the agency should focus on targeting problem areas and implementing existing requirements, such as due diligence,” the letter suggested. NCUA examiners should review 5300 reports and other documents from the credit union regarding its involvement with its CUSO, among other steps, the letter said. The CUNA letter was developed with CUNA's Examination and Supervision Subcommittee, Federal Credit Union Subcommittem and members of CUNA's Councils. For the full CUNA comment letter, use the resource link.


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