WASHINGTON-Following up on the General Accounting Office report (03-971) released this year, lawmakers have taken GAO's recommendations to heart. The omnibus appropriations package for fiscal year 2004 directs the Federal Trade Commission to enforce most of the privately insured credit union-related provisions in the Federal Deposit Insurance Corporation Improvement Act of 1991. Congress has not passed the bill yet and it may have to wait until next session. "Based on these recommendations, the conference agreement revises language included in the House and Senate bills requiring enforcement concerning disclosure and annual independent audits, but maintains the prohibition of enforcement of section 43(e) concerning the eligibility of Federal deposit insurance," the legislation reads. FTC is also directed to consult with FDIC and NCUA to determine the manner and content of disclosure requirements and coordinate with stated supervisors for enforcement. CUNA, NAFCU, NASCUS, NCUA, and American Share Insurance have gone on record in support of enforcing the disclosures. Section 151 of FDICIA requires privately insured credit unions to disclose in all of their advertising, on register receipts, on doors, at teller windows and various other places, the fact that they are not insured by the federal government. However, in more than a decade since the law passed, Congress has failed to fund the enforcement of the private insurance provisions. FTC lobbied hard not to have the responsibility saying they did not have the manpower or expertise. The GAO report discovered during surprise visits that 37% of 57 randomly sampled privately insured credit unions in Alabama, California, Illinois, Indiana, and Ohio did not have the proper disclosures displayed. Maryland, Nevada, and Idaho also have privately insured credit unions. Washington State, Montana, New Mexico, Oklahoma, Louisiana, Pennsylvania, New Jersey, New Hampshire, and Colorado permit private insurance, but are not home to any privately insured credit unions. Also as a result of the study, ASI, the sole remaining private primary insurer of credit unions, is undergoing a second round of education on the disclosures for its member credit unions, something they did 12 years ago when the law was initially passed. Debate over some state chartered credit unions' option for private insurance flared up in 2002 when multi-billion dollar Patelco Credit Union converted to private insurance, by far the largest insurance conversion ever. This led to NAFCU's coming out with a policy at the beginning of 2003, stating that all credit unions should be required to carry federal primary deposit insurance, which further fueled the fire. Colorado Financial Services Commissioner David Paul also decided this year that he could not approve state chartered credit unions' use of private deposit insurance because it lacked comparability with the NCUSIF. [email protected]