League Files Comment Letter on NCUA Proposal Governing Member Expulsion Process

Your League has filed a comment letter with the National Credit Union Administration in response to the agency's proposed rule to amend federal credit union bylaws regarding member expulsion. We note several possible improvements to the proposal.

The proposal would implement the CUNA-League-led Credit Union Governance Modernization Act (CUGMA), which was signed into law in March.  

The bill requires NCUA to develop a policy by which a federal credit union member may be expelled for cause by a two-thirds vote of a quorum of the FCU’s board of directors.

The League urged the NCUA to simplify the proposed member expulsion process and provided feedback on several questions posed in the request for comment.

Among the League's suggestions:

• Maintain federal credit unions' ability to limit services to members engaging in abusive behavior, in addition to authorizing an expulsion process.
• Allow the expulsion of members for abusive behavior directed at the credit union and staff on social channels, via email, or over the telephone, in addition to physical locations.
• We believe a simplified notice of expulsion is sufficient. Allow credit unions to communicate with members in the same manner they communicate decisions to limit a member's access to services.
• We strongly believe an in-person hearing should not be required as part of the member expulsion process and support flexibility for federal credit unions to conduct hearings as appropriate for the situation.
• We are also opposed to a Board of Directors being required to vote on a member’s reinstatement more than once.

Read our letter