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Corporates Request Guidance From NCUA on Bank Secrecy Act

WASHINGTON - How do wholesale institutions like corporate credit unions comply with a reg written for retail institutions like credit unions? Corporates want some answers. Corporate credit unions say they are happy to comply with the Bank Secrecy Act, but they need more guidance from NCUA. Association of Corporate Credit...

By Staff Writer | Updated on June 01, 2004

WASHINGTON – How do wholesale institutions like corporate credit unions comply with a reg written for retail institutions like credit unions? Corporates want some answers. Corporate credit unions say they are happy to comply with the Bank Secrecy Act, but they need more guidance from NCUA. Association of Corporate Credit Unions’ Executive Director Michael Canning said the ACCU met with NCUA recently requesting guidance on complying with BSA. The act requires that financials, including corporates, report suspicious wire transfers to suspect countries, among other things. “Corporates in the past couple of months have been confused by the general directive of the act and how it’s mandated. We want guidelines so that NCUA examiners don’t ask different corporates for different things,” said Canning. Corporate One President/CEO Lee Butke said his corporate is even seeking legal guidance on its own. “Our attorney has tried to seek legal guidance. The question is even though we are a corporate credit union, what are the responsibilities of a correspondent bank, since we are in essence once-removed from the consumer. Things like OFAC are no-brainers, but this isn’t,” said Butke. Butke said as a wholesale provider, the corporate may not have individual names, like a CU would, so would it have to report down to that level is a concern. According to NCUA spokesperson Cliff Northup, the Office of Corporate Credit Unions has written guidance on the issue. Northup said the guidance is with NCUA’s general counsel and should be released within a few weeks. Canning noted that there are also technical issues to work out, such as software problems. “We have software that wasn’t set up to do this kind of thing, we need to know how best we can make sure these activities are monitored,” said Canning.

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