WASHINGTON–CUNA wrote in opposition to NCUA's proposal adding a conflict of interest provision to the eligible obligations rule for the simple fact that the agency does not explain why the rule is necessary.

In its official comment letter, CUNA Senior Assistant General Counsel Jeff Bloch wrote, "CUNA agrees that credit unions should avoid conflicts of interest, including for these types of activities, as well as any appearance of such a conflict. However, NCUA has not provided any information in the Supplementary Information or elsewhere to support the need for this new rule change. Furthermore, there is no other indication that FCU officials have engaged in activities involving eligible obligations that benefited them, their employees, or immediate family members to the detriment of the members' best interests."

NCUA's proposal would add a provision stating that anyone associated with the credit union cannot receive, directly or indirectly, any compensation relating to an eligible obligation transaction. Comments are due Aug. 27.