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Removing Barriers Blog

ABA Sues NCUA Over Field of Membership
Posted December 08, 2016 by CUNA Advocacy

The American Bankers Association (ABA) filed a lawsuit against the NCUA over the agency’s final field of membership (FOM) rule, which was also published in the Federal Register yesterday.  The lawsuit is very similar to the recent Independent Community Bankers Association’s lawsuit against NCUA over the recent final Member Business Lending (MBL) Rule.  Both lawsuits allege that the NCUA has improperly interpreted the Federal Credit Union Act in its recent FOM and MBL rulemakings.

Reacting to the lawsuit, CUNA President/CEO Jim Nussle said that “the NCUA acted well within its authority when it issued its field of membership rule. This meritless attack from bankers on the NCUA’s rule completely ignores both the law and the NCUA’s authority to regulate credit unions.  The suit completely lacks worth, and CUNA and its partners will vigorously defend the rule on behalf of credit unions and the consumers that will benefit from the changes.”

The final FOM rule provides much needed regulatory relief for credit unions.  It modernizes FOM regulations, giving credit unions more flexibility in defining the communities that they serve and thus gives consumers more choice for financial services. 

The NCUA has also proposed an additional FOM rule containing CUNA-suggested changes. Comments on that proposal are due Dec. 9. The NCUA’s rule, finalized in October, is effective starting Feb. 6.