ALEXANDRIA, Va. — The NCUA Board at its meeting today issued a proposed regulation for comment that would re-incorporate Federal Credit Union Bylaws into NCUA's regulations.
Following arguments over bylaws between members and management of credit unions considering mutual savings bank conversions, NCUA's policy of relying on the state court system to clear things up proved to be less than desirable, i.e. DFCU Financial.
As a result, NCUA is seeking to re-incorporate the Federal Credit Union Bylaws into its regulations by reference to provide the agency a full range of options for handling these situations. "Re-incorporation of the bylaws will once again assure the members that the bylaws do mean something and someone will be held accountable for enforcing them," NCUA Chairman JoAnn Johnson stated.
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Prior to 1982, the bylaws had been included in NCUA regulation, but as part of an overall deregulation effort, they were removed. At that time, NCUA took the position that state corporate law, as consistent with the Federal Credit Union Act and NCUA's regulation, should govern bylaw enforcement. Currently, NCUA has said its only remedy is charter suspension or revocation, which are extreme and not beneficial to the members.
NCUA Staff Attorney Elizabeth Wirick emphasized, "This proposal does not mean NCUA will become involved in every bylaw dispute."
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