Because of several negative comments I received regarding myLetter to the Editor published in the Oct. 12 issue, please allowme to add some follow-up discussion points on the NSF Fee Capproposal, which is not totally without merit as some readerssuggested. I grew up in a home of five children where frequentlythere were more kids than money. Not uncommon for the times, myparents wrote many checks against non-sufficient funds. There wasno dishonesty and the checks were always – eventually – made good.Today, millions of CU members are in a similar situation. Thecurrent unregulated NSF fees create additional financial burden onan already stretched family budget. Credit unions are failing,often abusing, this critical segment of our membership. The $7difference between the current CU industry average of $22.50 and myproposed NSF fee cap of three times the federal minimum wage willmake a substantial difference to the millions of CU members thatlack the financial resources or education to avoid NSFs. It is notuncommon for members in the NSF-cycle to write four or five NSFsper month. The proposal provides a fee savings of $400 to $600after-tax dollars a year to these members “of small means,” to uselanguage from the Federal Credit Union Act. The NSF fee cap wouldlet the industry demonstrate why it is tax-exempt. Thetax-exemption is not simply tied to our co-operative form oforganization. Most co-ops pay federal income tax. Congress grantedcredit unions the tax-exemption based on the expectation that CUswould fulfill a social mission of providing members with low-costfinancial services. Credit unions charging $22 for a $2 servicedisrespect Congress' tax-exemption and at the same time support thebankers' claims that credit unions are acting like banks. Whyregulate? Why not let the free market set the NSF rate? I answerthose questions with a question. When is the last time a financialinstitution advertised NSF fees? As Greg McBride of Bankrate.comaccurately stated in USA Today, Oct 4, 2005, “No one is going toadvertise low bounced check fees”. The free market is not workingbecause consumers do not price-shop NSF fees. Regulatoryintervention is often justified when the free market does not workas is the case with NSF fees. Today, credit unions representing 40%of this member-owned, not-for-profit industry's assets subscribe toa nationally-known financial strategist that strongly advocatesmore and more fee income. As an invited guest to one of thestrategist's meetings, I learned first hand how to “trick” (thepresenter's word) members into investing in 13-month certificatesso that member funds can be rolled into lower-rate 12-monthcertificates upon maturity. When competing with the for-profitbanking sector credit unions increasingly forego what's in the bestinterest of the membership. Why doesn't the industry see it islosing its moral compass as it demands more bank-like authority?Maybe it has something to do with being too close to the trees tosee the forest. U.S. Congressman Bill Thomas, Chairman of the HouseCommittee on Ways and Means is not standing in the forest. He seesthe same thing I've been concerned about since my first CreditUnion Times' Letter to the Editor published in 1994 when I asked“Does your credit union operate in a manner that warrants a federaltax exemption ?” Unfortunately, fewer and fewer credit unions canhonestly answer yes. If not careful, credit unions will soon reachthe point of no return toward taxation. An NSF fee cap and otherpro-member benefits will send the message to congress that ourtax-exemption remains justified. Dale Kerslake President/CEOCascade FCU Seattle, Wash.