NAFCU presents unique perspective of federals

ARLINGTON, Va.-In a press audioconference after the NCUA budget hearing, NAFCU President and CEO Fred Becker pointed out the uniqueness of federal credit unions’ position and the trade group’s testimony. Specifically, Becker said in his testimony and during the teleconference that the federal government is subsidizing the supervision of privately insured, state chartered credit unions. Eighteen states’ laws permit the state regulators to allow private deposit insurance for state chartered credit unions, he said. Of those only eight state regulators currently allow it with one more state pending. When NCUA provides state regulators in these states training and equipment, it is paying for the regulation of credit unions of no consequence to the NCUSIF, NAFCU asserted. Becker explained, “.we discussed the fact that NCUA does provide training, computers, etc. to the state insurers and in some instances, I understand that’s a significant portion. Twenty-five percent in one state (Indiana) may be privately insured. And so we asked that the NCUA’s general counsel take a look at whether or not that was a legal expenditure of federal dollars.” NAFCU Senior Vice President and General Counsel Bill Donovan put it this way: “It can be looked at from two perspectives. One, whether or not it is legal for the agency to do so. Two, whether or not, regardless of the legality, it’s appropriate for the agency to do so. To the extent that the National Credit Union Administration is subsidizing the training, the equipping, the outfitting of state examiners, who are using federally funded training, federally funded equipment to examine credit unions that have no tie to the federal system, there is some question as to whether or not its appropriate to use federal funds, or funds collected by the federal regulatory agency, to do that.” [email protected]