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CUNA Comment Letter

CUNA GUIDELINES FOR THE NCUA BOARD ON THE ENFORCEMENT OF FEDERAL CREDIT UNION BYLAWS

The CUNA Examination and Supervision Subcommittee developed the following guidelines for bylaw enforcement which have been reviewed by CUNA’s Governmental Affairs Committee and adopted as policy by CUNA’s Executive Committee. These guidelines recognize that NCUA has the legal authority to enforce bylaws, but due to number of practical and operational concerns, they oppose NCUA’s enforcement of bylaws that do not address members’ fundamental rights and merely address administrative issues. The guidelines also seek to preclude the potential for NCUA examiners to intrude, under the auspices of bylaw regulation, into the daily affairs of a credit union.

• NCUA should recognize that every federal credit union may choose to develop an internal process for handling bylaw disputes.
• NCUA should allow a federal credit union to utilize its internal credit union process first before the agency becomes involved in a bylaw dispute.
• More specifically, NCUA should become involved in the enforcement of a federal bylaw only when a bylaw dispute cannot be resolved within the credit union before turning to NCUA.
• When NCUA becomes involved in bylaw enforcement, its authority should be narrowly construed and should not address bylaws that are strictly ministerial in nature.
• NCUA examiners should be prohibited from involvement in any bylaw disputes, and bylaw compliance should not be integrated into the examination process.
• When an unresolved dispute occurs regarding the enforcement of a core-issue bylaw, the appropriate NCUA regional director should review the dispute. The regional director’s decision should be appealable to the NCUA central office.
• NCUA’s enforcement of the bylaws should not impose greater regulatory burdens on federal credit unions and should not be more expansive than that of other regulators.

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