The committee is made up of three NCUA staff members named by the NCUA chairman. Currently, the SRC members are Joy Lee, senior FFIEC adviser to the chairman; Gerard Poliquin, trial attorney; and Judy Graham, program officer.

First, by definition the SRC is not independent because it is intra-agency. Safeguards are in place to keep certain positions from serving on the board, including regional directors, the executive director or board members’ political appointees.

The process should be more transparent and independent. The NCUA won’t even divulge which examiners examine which credit unions. When Credit Union Times reported the name of the SRC chairman, provided by the NCUA executive director, we were asked to remove it from our website. The agency’s unwillingness to shine a light on this process seems to imply 1) they don’t want credit unions to use it and 2) they don’t want people to know what is happening with it.

In all previous cases before the SRC–just four since its inception–it ruled against the credit union. All arrows indicate it’s not independent, it’s not known about or well understood, and credit unions are discouraged from using it.

Commodore Perry may very well have deserved the CAMEL score decrease, but without transparency no one will know. Obviously, in some parts of the agency’s work discretion is required, but it also can hide personal or political matters affecting operations behind the scenes. The primary issue at this credit union, as I understand it, is the ever-subjective M, as it is at other credit unions like SECU. Note that both institutions are in Region III. The same region–same state even–that brought us St. Paul Croatian FCU, believed to be the largest natural person credit union loss in history at $170 million. The same region responsible for examining New London FCU, dinging the industry for more than $12 million.

But what’s being lost in the shuffle is the initial issue. The question is whether the agency is willing to seriously consider the allegations of sexual harassment that have been made by Commodore Perry employees. The accused examiner would be covered by the National Treasury Employees Union. The OIG report was not made public as of press time but that appeal had already been dismissed.

On a separate note, out thoughts are with the victims of Hurricane Sandy. Credit union professionals and volunteers and many others are serving as heroes during this time of crisis. We applaud you all.