CUNA Regulatory Comment Call
November 30, 2006
Share Insurance Appeals and NCUA Enforcement Authority
- The NCUA Board has published an interim final rule to implement three amendments to
the Federal Credit Union Act made by the Reg Relief Act:
(1) Appeal from an NCUA Board decision relating to any claim for insurance coverage
NCUAs regulations currently provide that an appeal from a final NCUA Board determination regarding share insurance coverage are to be reviewed by the U.S. Court of Appeals for the District of Columbia or the court of appeals for the federal circuit where the credit unions principal place of business is located. The interim final rule revises the regulation to state that the appropriate venue for seeking such judicial review is the U.S. district court for the federal judicial district where the principal place of business of the credit union is located.
(2) Expansion of enforcement authority
Under the interim final rule, the NCUA Board may terminate the insured status of any insured credit union for violation of any condition imposed by the Board in connection with any action on any application, notice, or other request by the credit union or an institution-affiliated party. In addition, such violations can serve as the basis for cease and desist orders, removal and prohibition orders, and civil monetary penalties. Previously, such actions could only be taken upon a violation of conditions imposed in the granting of any application or other request by the credit union.
(3) Clarification of suspension, prohibition and removal authority
The interim final rule clarifies the NCUA Boards authority to issue Orders of Suspension, Prohibition and Removal against institution-affiliated parties regardless of whether: (a) the subject of the Order remains affiliated with any credit union at the time the Order is considered or issued or (b) the credit union at which the individual was an institution-affiliated party at the time of the offense remains in existence at the time the Order is considered or issued.
- Although the interim final regulation is effective November 22, 2006, NCUA is accepting comments on the regulation. Comments are due to NCUA by January 22, 2007. Please send your comments to CUNA by January 5, 2007. Please feel free to fax your responses to CUNA at 202-638-7052; e-mail them to Deputy General Counsel Mary Dunn at firstname.lastname@example.org or to Senior Regulatory Counsel Catherine Orr at email@example.com; or mail them to Mary or Catherine in c/o CUNA's Regulatory Advocacy Department, 601 Pennsylvania Avenue, NW, 6th Floor - South Building, Washington, DC 20004. You may also contact us at 800-356-9655 ext. 6743 if you would like a copy of the interim final rule, or you may access it here.
QUESTIONS REGARDING THE INTERIM FINAL RULE
- Do you agree that the proper judicial venue for appeals from a final Board decision
regarding share insurance coverage should be the appropriate U.S. District Court (a lower
court than the appropriate U.S. Court of Appeals)?
If no, why not?
- Do you have any concerns with respect to broadening the NCUA Boards authority to take
enforcement actions including termination of insured status -- for violation of any
condition imposed in any action on any application, notice, or other request by an
If yes, what are those concerns?
- Do you agree with the new modified provision clarifying that the NCUA Board has the
authority to issue Orders against an individual who is an institution-affiliated party even if
the individual is no longer affiliated with any credit union at the time the Board considers
or issues the Order?
- Other comments?
Eric Richard EVP &General Counsel (202) 508-6742 firstname.lastname@example.org |
Mary Mitchell Dunn SVP & Deputy General Counsel (202) 508-6736 email@example.com
Jeffrey Bloch Senior Assistant General Counsel (202) 508-6732 firstname.lastname@example.org
Lilly Thomas Assistant General Counsel (202) 508-6733 email@example.com
Catherine Orr Senior Regulatory Counsel (202) 508-6743 firstname.lastname@example.org