WASHNGTON — A credit union can use a CUSO to screen applications and process member business loans, as long as the arrangement is structured to avoid a conflict of interest, according to an NCUA opinion.
The credit union must see to it that the CUSO "is independent as to each transaction," NCUA Associate General Counsel Sheila A. Albin wrote in a May 1 letter to James E. Forney, the superintendent of the credit union division of the Iowa Department of Commerce.
Albin noted that the financial arrangement between the two organizations should not be one in which the CUSO is paid for each loan that is approved.
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