More Resignations Announced as NCUA Officials Silent on Ousting of McWatters

NCUA officials have declined to address Chairman Rodney Hood’s Friday move to have board member J. Mark McWatters ousted from office.

Agency officials did not respond to numerous emails, and text and phone messages asking them to discuss Hood’s actions, which led to McWatters resigning from the board late Friday.

A source familiar with the episode said that Hood had called the White House following Thursday’s board meeting during which McWatters said he opposed the budget being proposed by Hood. The source said that McWatters was given the choice of resigning or being removed from the board.

McWatters could be removed by President Trump since his term on the board had expired. The Senate is likely to vote on McWatters’s replacement, Kyle Hauptman, next week.

Sarah Vega, McWatters’s senior policy advisor, also submitted her resignation effective Monday. Vega had been at the agency since 2008 and had served as chief of staff for former NCUA Chairman Michael Fryzel.

In addition, Katie Supples, McWatters’s executive assistant, also has resigned.

McWatters declined to discuss his removal. In July, in an op-ed in the Credit Union Journal, McWatters referred to tension at the agency, but declined to discuss whether he was referring to Hood.

“Chairs should not expect board members to subordinate their independent analysis of the issues to the views of the chair,” McWatters wrote. “If Congress had intended for board members to fall in line behind the chair like toy soldiers, a single director would lead the NCUA, such as at the Office of the Comptroller of the Currency, Federal Housing Finance Agency or Consumer Financial Protection Bureau.”

Hood’s statement acknowledging McWatters’s departure was brief and did not address last week’s drama.

“Board Member Mark McWatters’ service on the NCUA Board concluded last week,” he said. “I would like to extend a sincere thank you to Board Member McWatters for his service. His years on the NCUA Board are a credit to his decades long career in law and policymaking. I wish Mark all the best in his future endeavors.”

Board Member Todd Harper, who is likely to be appointed board chairman after President-elect Joe Biden takes office, was effusive in his praise for McWatters. On some issues, including the agency’s budget, Harper, a Democrat, and Republican McWatters agreed in their criticism of policies proposed by Hood.

“During his six years on the NCUA Board, J. Mark McWatters’ intellect, independence and insights improved the policymaking process,” Harper said. “His many accomplishments include strengthening the transparency of the voluntary merger process, closing the Temporary Corporate Credit Union Stabilization Fund ahead of schedule and increasing the normal operating level of the Share Insurance Fund. Mark leaves the Board with a commendable record of achievement, and I wish him well in his future endeavors.”

Harper continued, “Going forward, my priorities will continue to be capital and liquidity, cybersecurity, consumer financial protection, and diversity, equity and economic inclusion. I will work alongside of the dedicated staff of the NCUA and my fellow Board members to ensure that the credit union system remains safe and sound and members are protected. Now, more than ever, we must work together to navigate through the pandemic-induced economic crisis.”

CUNA President/CEO Jim Nussle also praised McWatters and called on the Senate to swiftly confirm Hauptman.

“As a member of the NCUA Board, J. Mark McWatters has helped credit unions advance the financial well-being of their 120 million members,” Nussle said. “We’re appreciative of his work to reduce the regulatory hurdles that credit unions face and for his service to the movement. We wish him well in his next endeavor.”

NAFCU President/CEO B. Dan Berger said, “We appreciate [McWatters’] strong support in modernizing outdated regulations, reforming field of membership requirements, and ensuring credit unions have had the flexibility and resources needed to continue serving their members during challenging times.”