New Multi-County FOM Bids Still Pending, Says Love
SALT LAKE CITY - A federal judge's ruling last December rejecting six-county expansion bids by a group of Utah credit unions has certainly given pause to NCUA policies on multi-county approvals, but new field of membership applications are in the pipeline now, Region 5 Director Melinda Love told CU executives...
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SALT LAKE CITY – A federal judge’s ruling last December rejecting six-county expansion bids by a group of Utah credit unions has certainly given pause to NCUA policies on multi-county approvals, but new field of membership applications are in the pipeline now, Region 5 Director Melinda Love told CU executives here. Addressing the annual meeting of the Utah League of Credit Unions, Love said the agency is “following the rigors” in applying established rule-making on multi-county FOM bids with the process going forward on new applications. She said Region 5 as well as others have such pending FOM applications including those from large institutions and one “that is coming up next month” in an apparent reference for board action. She did not identify any of the states or CUs but she said NCUA remains cognizant of Salt Lake District Judge Dale Kimball’s admonitions of Dec. 8 on the American Bankers Association suit turning aside FOM approvals and remanding them back to the agency. The Salt Lake judge held the agency did not follow certain MSA standards in granting the six-county approvals to Tooele FCU, America First FCU, Goldenwest FCU and University of Utah FCU. The ABA had charged NCUA had acted “arbitrarily and capriciously” in approving what it called illegal six-county FOM bids for the Utah CUs. Love, whose office recommended the NCUA Board approve the first FOM bid by Tooele in April 2003, made her comments on NCUA policies in response to a question brought from the floor by Steven Christensen, president/CEO of Tooele and outgoing chairman of the League. Describing herself as taken aback by the judge’s ruling and also a “risk taker” as a regulator, the regional director told Christensen and other Utah CU executives she would continue to act “on the existing rules until they are changed.” And in defending a decision not to appeal Judge Kimball’s ruling, NCUA had concerns over the application of MSA standards as well as possibly negative fallout from a sudden loss of members at the affected CUs. A “major divestiture of members” could be devastating to the institutions, she maintained. In jest, she joked about Christensen, the Toole CEO, getting her into legal trouble since it was his CU “that got me sued.” Tooele’s six-county approval – later reduced to one county under the Judge’s ruling – did follow six-county FOMs by America FCU, University of Utah and Goldenwest, all of which converted to federal charters in the wake of a bank-driven 2003 CU law seeking to tax CUs. Earlier in her remarks, Love recalled how her pre-Christmas 2004 holidays with family in Phoenix were nearly ruined when she received word about the Judge’s ruling and then quickly had to deal with early confusion about the scope of the Kimball decision. She had been introduced to the convention gathering by League President Scott Simpson as an individual “holding one of the toughest jobs” in NCUA and adding with a bit of sarcasm, that she was brought to Utah, “the most boring regulatory state in the country.” Alluding to Utah being at the center of regulatory and legislative turmoil, she told the group she felt “I needed to be in Utah” prompting her decision to be a featured speaker at the opening day session of the League conference. -
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