U.S. Supreme Court. (Source: Two Bridges Photography/Shutterstock)
On Monday, the Supreme Court of the United States denied an appeal from the American Bankers Association to review the NCUA's field of membership (FOM) rules.
This decision by the Supreme Court brings to an end an almost four-year legal battle by the ABA against the NCUA.
On Monday afternoon, NCUA Chairman Rodney Hood released the following statement: "Today's decision by the Supreme Court ends nearly four years of uncertainty and will help the NCUA in its efforts to foster greater financial inclusion for all Americans. The NCUA will begin processing field-of-membership applications affected by this decision immediately."
Shortly after the Supreme Court's decision, CUNA, NAFCU and CUNA Mutual Group released a joint announcement stating the groups "have long supported the rule and the NCUA's authority to provide oversight for the credit union industry."
"Today is a great day for anyone hoping to access the financial well-being afforded by credit unions," CUNA President/CEO Jim Nussle said. In denying the bankers' lawsuit, the Court has established credit unions' mission and structure as part the fabric of America. In recognizing the NCUA's right to oversee our system, the Court has also established a much-needed firewall from spurious attacks by the bankers. CUNA looks forward to working with the NCUA and credit unions to find new opportunities to expand people-over-profit financial services to communities across the country, and thanks the Court for today's decision."
"The Supreme Court's decision to decline to hear the banker's case is an indication that the case is and has always been a baseless one," NAFCU President/CEO Dan Berger said. "For years, bank lobbyists have been unrelenting in their hollow efforts to maximize their own profits by working to undermine credit union growth and the financial well-being of America's communities and small businesses. NAFCU stands firmly in support of the NCUA's field of membership rule. It is well within the agency's legal authority and works in favor of consumers, especially those that are underserved."
"This is fantastic, and we applaud the Supreme Court for correctly rejecting the bankers' appeal," Robert N. Trunzo, CUNA Mutual Group president/CEO, said. "This is a great win for credit unions and consumers during what could possibly be the most challenging period our nation and world have faced. As we continue to navigate through this extraordinarily difficult time, the Court's decision will ensure people have continued access to vital credit union services as they seek to build a brighter financial future."
In March 2018, Judge Dabney Friedrich of the U.S. District Court for the District of Columbia struck down parts of a rule the NCUA issued in 2016. Those sections automatically qualified a Combined Statistical Area or a contiguous portion of it with fewer than 2.5 million people to be a local community and increased the population limit to one million people for rural districts.
However, a three-judge panel from the U.S. Court of Appeals for the District of Columbia overturned large parts of that decision, ruling that major sections of the FOM rule complied with federal law.
The ABA then asked the high court to review that decision, contending that the rules give credit unions an unfair advantage.
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Michael Ogden
Editor-in-Chief at CU Times. To connect, email at [email protected]. As Editor-in-Chief of CU Times since 2016, Michael Ogden has led the editorial team in all aspects of content strategy and execution, including the creation of the publication’s exclusive and proprietary research database of the credit union industry’s economic landscape. Under Michael’s leadership, CU Times has successfully shifted to an all-digital editorial product with new focuses on the payments, fraud, lending and regulatory beats. Most recently, he introduced a data-focused editorial product for subscribers that breaks down credit union issues into hard data, allowing for a deeper and more factual narrative for readers. In 2024, he launched the "Shared Accounts With CU Times" podcast, which offers a fresh, inside-the-newsroom perspective through interviews with leaders from the credit union industry and the regulatory world. He dives into pressing credit union issues, while revealing the personalities working behind-the-scenes to push the credit union world forward. His background includes years as a radio and TV anchor/reporter and a public relations and digital/social media manager, where he covered the food and music industries, as well as cooperatives and credit unions. Over the years, he has launched numerous exclusive video and podcast series, including a successful series of interactive backstage interviews with musicians at music festivals, showcasing his social media and live streaming production skills.
