NAFCU Backs Examination Reform Measure
A bill to give financial institutions the chance to appeal the results of their federal examinations would be beneficial for credit unions because it “can be a useful incentive to conduct the process in a fair and consistent manner from the onset,’’ NAFCU Executive Vice President Dan Berger wrote lawmakers on Friday.
“Consistency in the examination process is a key component to providing results accurately reflecting safety and soundness,’’ he added.
The measure has 66 cosponsors in the 435-member House of Representatives. No companion bill has been introduced in the Senate. Its main sponsors are Rep. Shelley Moore Capito (R-W.Va.), the chairman of the subcommittee with primary jurisdiction over credit union issues, and Rep. Carolyn Maloney (D-N.Y.), the panel’s ranking Democrat. The NCUA hasn’t taken a position on the measure.
Under the bill, a financial institution that is unhappy with the results of its examination would have the right to appeal it to an administrative law judge who would submit his or her findings to the ombudsman of the Federal Financial Institutions Examination Council, which is made up of representatives of federal and state regulatory entities. NCUA Chairman Debbie Matz is the council’s current chairman.
The bill requires federal financial regulators to produce examination reports within 60 days of an examination’s completion. In addition, if the financial institution wants it, the agency must include an appendix to the report listing all the facts that were used as a basis for the conclusions.
Earlier this week, CUNA endorsed the bill and made some suggestions for changing it.