My father recently asked me what I do for a living. I help fixleaks, I told him. As usual, he shook his head and walked away.

Paternal disdain aside, I think the analogy is perfect. Creditunions can be seen as a boat. The board of directors picks thedestination, and the CEO dons a captain's cap and gets to work.What does compliance do on the U.S.S. Credit Union?

It prevents leaks, plugs them when found, and bails water whennecessary.

Contract reviews, risk-based planning and old-fashionedstrategic planning are a few of the ways that complianceprofessionals prevent leaks. At first glance, a good complianceofficer can seem overly pessimistic. But dig deeper, and you'll seerisk avoidance. Compliance officers look for potential problems.Product development. Ad campaigns. Contracts. They look for holes,hidden disasters and ugly warts. When they find them, they alertthe captain who can marshal the credit union's resources.

Not all leaks can be avoided. New guidance can punch a tiny holein the U.S.S. Credit Union. NCUA Letters to Credit Unions,regulatory alerts, risk alerts. Without a crystal ball, acompliance officer will never anticipate every contingency in aproposed regulation. When the regulation goes final, you'll haveleaks. That's a fact of life. Remember the guidance on multi-factorauthentication? In that case, a 14-page guidance document likelycost U.S. financial institutions hundreds of millions ofdollars.

Leaks are not always life threatening. If, however, you haveenough of them, or the leak is too large--then start looking forbuckets. When FinCEN and the financial regulators released the300-plus page Bank Secrecy Act/Anti-Money Laundering Examiner'sManual in 2005, it caught many financial institutions off guard.There was no proposal or notice and comment period. No lighthouse,if you will. And the water poured in, causing financialinstitutions to bail for their lives. Just ask folks who worked atRiggs. Or AmSouth. Or the many financial institutions that receiveda regulatory cease and desist order for BSA-related issues.

While we like to blame BSA for our compliance woes, it isn't theonly cause of rising waters. Everywhere you look, guidance andregulations are hitting our hull. Recordkeeping. Red flags.Third-party due diligence. Affiliate marketing. Pandemics.Amendments to Regulation Z. As I write this, I hear that REPSAreform is right around the corner. Leak after leak must be stopped.But there are only so many fingers or pieces of bubble gum. Toomany leaks can lead to buckets.

When I talk to credit union captains, I hear a common theme.While credit unions want to comply with regulations, the problem isthere's no way for credit union captains to know how manycompliance sailors to bring aboard. In a risk-based world, I thinkone reason is that credit unions cannot control the largest riskfactors: Congress and the regulators.

How will the final amendments to Regulation Z's open-end ruleslook? I don't know. RESPA? I'm not sure. How many new complianceburdens will emerge from NCUA's data collection pilot? Goodquestions. Will the various bills on Capitol Hill that addressmortgage lending, bankruptcy, overdraft protection, credit cardsand data security come to fruition? If they do, how will they look?I think you get the point.

About a year ago, I had a wonderful opportunity to chat withfolks from the Treasury Department, including representatives fromthe Financial Crimes Enforcement Network and the Office of ForeignAssets Control. I told them that credit unions could handle BSA.Credit unions can do anything, I argued, if they can throw enoughresources at the problem. However, I indicated that I'm worriedabout the next BSA. That statement seemed to puzzle them. Icontinued to explain that credit unions and banks might not be ableto handle multiple BSA-like regulations. I explained that FinCENwas not the only regulator with powers over credit unions andbanks. They have to worry about fair lending, security issues,disclosures, contracts, third parties, etc. What if anotherregulator requires credit unions and banks to devote BSA-likeresources on something new? Or two new issues? Or three? Then we'dhave problems. And we'd start bailing.

I know that credit unions' return on assets has been shrinkingin recent years. Some blame the economy or the inverted yieldcurve. What about the crushing weight of regulation and guidance?When does the weight of regulation and guidance itself become athreat to safety and soundness? Credit unions are not-for-profits.However, we must take in more than we shovel out to build networth. When we have to hire additional compliance officers,purchase software or employ outside consultants, the credit union'sROA will go down, all other things remaining equal.

To our regulators and lawmakers, I say this: Keep in mind thatcredit unions and other financial institutions want to do the rightthing, but resources are scarce, time is limited and complianceofficers are expensive.

And to our credit union CEO/captains: We need your help. Whenregulatory proposals are floated, we need your comments, your inputand your observations. The folks who draft regulations do not haveyour operational expertise. They want and seek your input. Anythingyou can do in this area would be worth its weight in gold.

It might seem strange to have a compliance guy hoping for lessregulation. While complex regulations mean job security, at the endof a day I'm a credit union guy. I want my credit union to spend aslittle time bailing water as possible. After all, we have abusiness run--or a ship to sail, if you will.