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News Now

Washington
Vensures challenge to NCUA to be heard on May 11
WASHINGTON (4/28/11)--Vensure FCU's request to delay the National Credit Union Administration's (NCUA) conservatorship of the credit union will be heard before a U.S. District Court on May 11. U.S. District Court for the District of Columbia Judge Rosemary Collyer on Tuesday denied Vensure's request for a temporary restraining order to immediately halt the NCUA's conservatorship of the credit union. Collyer said that the Federal Credit Union Act does not allow a temporary restraining order under these circumstances. The Mesa, Ariz.-based credit union earlier this week challenged the NCUA's April 15 conservatorship, claiming that the NCUA's action "was arbitrary and capricious and threatens to significantly damage or destroy" the credit union. The complaint adds that the agency's conservatorship order "contained only cursory and incomplete facts to support the grounds for conservancy and included no exhibits, appendices or empirical data in support." The credit union also noted that the NCUA "took possession of the very financial records [the credit union] needs to demonstrate that conservatorship is improper." The plaintiffs also claimed that the NCUA violated due process in going forward with the conservatorship last week. While the NCUA had repeatedly noted deficiencies in the credit union's operations, the credit union claimed that its fortunes had improved under the stewardship of its new directors, adding new members and services. The new management, which took over in 2009, also worked with the NCUA to implement changes set forth in several letters of understanding and agreement. The credit union in the complaint admitted that it had taken part in poker-related fund transactions, and said that its work with online poker sites had helped it increase its size from a $150,000 asset credit union to one that held millions in assets. Vensure said that it never intended to permanently depend on these revenues. The credit union said that its directors had recently voted to stop doing business with the online poker companies, and said that it would have remained solvent, even without the funds provided by its financial relationship with the gambling firms. An NCUA official declined to comment on the case.


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