United States Capitol Building, Washington D.C. (Source: Shutterstock)
On Tuesday, members of the House Financial Services Committee tackled several bills concerning the removal of barriers to some potentially outdated credit union regulations, including an update to the Credit Union Governance Modernization Act (CUGMA).
The CUGMA is bill that would update the Federal Credit Union Act to allow credit union boards to swiftly expel a member for just cause. Current law requires a full membership vote to expel a member.
The bill, introduced earlier this year by Reps. Tom Emmer (R-Minn.) and Ed Perlmutter (D-Colo.), would make it easier for credit unions to expel members who have engaged in fraudulent or illegal activities or have conducted physical or verbal abuse to credit union staff and/or members.
During Tuesday's debate, Committee members quickly approved the amendment to the Federal Credit Union Act to be sent to the House of Representatives for further discussion.
After Tuesday's vote, NAFCU Vice President of Legislative Affairs Brad Thaler said, "NAFCU applauds the House Financial Services Committee for advancing the Credit Union Governance Modernization Act and taking yet another positive step toward ensuring credit unions, their members, and staff are kept safe from harmful and subversive behavior. This bill will establish better protections for credit unions dealing with members who engage in unlawful behavior by providing clearer expulsion regulations. NAFCU has consistently offered support for the advancement of this bill and essential reforms for the credit union expulsion process and we look forward to working with Congress to finalize this legislation."
For the past several months, CUNA and NAFCU have voiced their support for updating the expulsion regulations in the Federal Credit Union Act. In April, CUNA President/CEO Jim Nussle said, "CUNA, Leagues and credit unions look forward to advancing this, and other, much needed Federal Credit Union Act modernizations to ensure credit unions can meet the needs of 21st century consumers."
According to Thaler's letter to Committee members this week, he said this amendment is "timely legislation [that] will help provide urgently needed relief to credit unions that are constrained in their efforts to remove dangerous and threatening members from their institution by outdated provisions of the Federal Credit Union Act."
"Allowing credit unions to adopt a streamlined expulsion process, while still protecting member rights, will have an immediate and positive impact on the credit union industry," Thaler wrote. "The managers' amendment offered by Representatives Emmer and Perlmutter strikes the appropriate balance to do so. It will also serve to better protect credit union staff and other members of the institution from having to interact with those who would pose a threat."
Also on Tuesday's Committee agenda, Rep. Joyce Beatty (D-Ohio) introduced the "Fair Hiring in Banking Act," which would remove a lifetime ban for banking employees who have been convicted of a felony before the age of 21. In a letter to Committee members, Thaler supported the amendment to reduce employment barriers for those who have had past minor offenses.
"A similar effort to reduce barriers to employment has been a National Credit Union Administration priority under the leadership of chairmen from both parties, and NAFCU was pleased to support the agency's Second Chance Interpretive Ruling and Policy Statement in 2019. We are pleased to see the Committee is also committed to working on this issue and urge support for the legislation at the markup," Thaler wrote.
Rep. Beatty's amendment was adopted by the Committee and will be sent to the full House for debate.
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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.
