OLYMPIA, Wash.--It's d?(C)j? vu all over again.
The semantic clash last April in Nebraska--culminating in a state attorney general's opinion over credit unions' use of the term "banking" to describe its business--is taking place now in Washington State.
Washington Attorney General Rob McKenna has taken issue with credit unions' use of "bank," "banking" and "banker" in CU ads, but the major trade groups, including the Washington Credit Union League joined by the state regulator, are hoping for a quick resolution.
"We had a successful meeting last Thursday in our offices which followed an opinion rendered by our attorney general triggered by the Nebraska ruling," said Scott Jarvis, director of the Washington Department of Financial Institutions.
While the Oct. 29 opinion by Washington State Assistant Attorney General Heather Polz clashes with the banking verbiage for state-chartered CUs, the regulator has certain discretionary authority in light of parity statues and conflicting language, officials said.
"We are looking to a consensus so we don't have to take this to the legislature," said Jarvis, echoing the position also advocated by the Washington league.
Over the last year there have been a handful of cases where CUS touted themselves as "better than banks" and DFI asked the language be toned down. League officials said CUs agreed.
According to League officials, the attorney latest general's opinion made clear that NCUA rules clearly provide pre-emption for federal credit unions but still make problems for state charters.
In Nebraska where bankers also complained about CU "banking" language, the attorney general in that state ruled the Nebraska statute is pre-empted by NCUA regulation.
Meanwhile, the Washington league said it is currently
surveying CUs in the state "to get a firm grasp on exactly
how credit unions are using the terms, 'bank,' 'banker,'
and 'banking.'"
Referring to a Nov. 29 DFI meeting of trade groups discuss the issue, Stacy Augustine, WCUL senior vice president and general counsel, said CUs and bankers are looking for a common-sense definition that everyone can live with, given that "we're talking about interpreting a 1917 banking act."
Jarvis said he is eager for bankers and CUs--which, he joked, are "all my children"--to find a way to live peacefully with the regulations. If they don't, he winked, "I'll take away their food."
--jrubenscut@aol.com
