PORTLAND, Maine — Moving credit union bylaws into NCUA's regulations will not necessarily stop litigation surrounding credit union attempts to change from credit union to bank charters, according to a leading consultant in the process.
Alan Theriault, CEO of CU Financial Services, a leading consultancy for credit unions considering changing to mutual bank charters, asserts that since federal law gives credit union members the right to vote on whether to convert their CU's charter to that of a mutual bank even an attempt by credit union members to hold a special meeting to block such a vote would be illegal–and a court would find it so.
"On the whole it's really hard to say what the impact might be," Theriault said. "But if the NCUA or some other clandestine group or a faction of the credit union members wants to use the NCUA's bylaw enforcement in an attempt to block a conversion vote, which is a right of credit union members in federal law, I don't think that would be legal."
He also pointed out that a credit union's bylaws themselves are subject to federal and state law and flow from the credit union's charter, which is itself created by those laws.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.