WASHINGTON -- Three Harrisburg, Pa.-area credit unions would be allowed to keep their new members but not recruit additional ones in their expanded field of membership, according to a proposed remedy the NCUA yesterday agreed to with the American Bankers Association.
The remedy, which must be approved by a federal judge, is the result of July decision in a lawsuit filed against the NCUA by the ABA. It also sends the case back to the NCUA for additional review. The remedy was proposed by the ABA in a court filing last month. In its filing yesterday, NCUA said it and the ABA agreed to include in the agreement a provision allowing household and family members to join a credit union based on their relationship with a member at the time of the original NCUA decision.
CUNA, NAFCU and the Pennsylvania Credit Union League expressed support for the remedy in a motion filed yesterday but said it shouldn't set a precedent that the consent of the bankers or others is required in future cases.
In July, U.S. District Court Judge Kane ruled that the NCUA had acted in an "arbitrary and capricious manner'' and ignored contrary evidence when deciding to grant Members First Federal Credit Union a community charter. The agency, granted the other two credit unions, Americhoice Federal Credit Union and New Cumberland Federal Credit Union, community charters after its Members First decision.