Credit Union CEOs Ask Congress to Overhaul the NCUA
The attack on NCUA policies spearheaded last December in a petition drive by a Michigan CUSO group entered a new phase last week when a Tennessee group joined the fray.
The latest barrage was unleashed by an ad hoc group of 32 CEOs and credit union executives complaining directly to Congressional committees.
The group, the Credit Union Committee on Declaration of Grievances, listed its complaints in a seven-page letter and demanded lawmakers make needed changes and bring the NCUA under tighter control.
The grievances covered a broad range and took other federal agencies to task for excessive regulation. It hit particularly hard at the 8% wage increase for NCUA employees and what it said is a 12% overall agency budget increase coming at a time while the rest of the country undergoes "recession and sacrifice."
The group also cited failures by the agency in general industry oversight and in providing adequate supervision of the corporate network, which it argued has put a huge financial burden on CUs and their members.
Signers of the declaration, which was formally submitted on March 4 to the House Financial Services Committee and the Senate Banking, Housing and Urban Affairs Committee, include CEOs and senior managers from a host of small and medium-sized CUs in Tennessee, North Carolina and Ohio.
"We are simply a group that collaborated because we all were fed up, feeling strongly that something needed to be said and done," said Becca Montgomery, president/CEO of the $36 million Covenant Health CU of Knoxville.
She said many of the signers are CEOs and executives from Knoxville area CUs who have been meeting online for more than a month to write the petition coordinated by management of the $136 million Alcoa Tenn FCU. The informal group has since solicited petition signers who share the group’s views from outside Tennessee, said Montgomery.
In defending the NCUA, Todd Harper, NCUA director of public and Congressional affairs, said the agency has long been aware of CU complaints over agency decisions raised over the past year and has long stressed the transparency of all the agency’s expenditures.
Responding to one complaint brought by the Tennessee group that too much was being spent on the NCUA public service campaign on federal insurance coverage and featuring finance guru and author Suze Orman, Harper said the ads have already proved worthwhile in helping to educate and reassure consumers.
"The 2011 NCUA budget includes $1.6 million for the consumer education campaign," said Harper. "We think it is vitally important that consumers are aware of and understand the value of the NCUA logo and federal insurance on their accounts."
But Montgomery questioned the wisdom of "a $2 million campaign."
"One thing I can’t understand is how NCUA can spend $2 million then turn around and hit us with those assessments," said Montgomery.
Randy Karnes, president/CEO of CU*Answers, a Grand Rapids, Mich. CUSO and author of a similar petition circulating online since last December, said he was aware of the Tennessee drive, but there is no connection between the two groups.
The Karnes petition has more than 107 signatures, of which 40 are anonymous.
Mark Wolff, senior vice president-communications at CUNA, confirmed the trade group was aware of the Tennessee group efforts, adding, "We are reaching out to the credit unions who have signed the declaration to discuss the specific issues they’ve raised and also to make sure they are up to date on the many steps that CUNA has been taking to secure regulatory and financial relief for the credit union movement."