Compliance Blog

During its October meeting, a new final rule was adopted by the National Credit Union Administration (NCUA) Board to streamline and establish uniform procedures in cases in which a decision by a regional director or other program office director is appealed to the NCUA Board.  Effective January 1, 2018, the new procedures will apply to agency regulations with currently embedded appeals provisions. 

Most authorized appeals to the NCUA Board will be governed by the new 12 CFR part 746, Subpart B. The regulations under which a credit union can appeal initial agency determinations include:

• 701 Organization and Operation of Federal Credit Unions,
• 703 Investment and Deposit Activities,
• 705 Community Development Revolving Loan Fund Access for Credit Unions,
• 708a Bank Conversions and Mergers,
• 709 Involuntary Liquidation of Federal Credit Unions and Adjudication of Creditor Claims Involving Federally Insured Credit Unions in Liquidation,
• 741 Requirements for Insurance,
• 745, Subpart B Share Insurance and Appendix,
• 747 Administrative Actions, Adjudicative Hearings, Rules of Practice and Procedure, and Investigations,
• 750 Golden Parachutes, and
• FCU Act Chartering and Field of Membership Determinations.

There are, however, five areas that are excluded from the scope of this new rule:  Enforcement Actions; Creditor claims in liquidation that are litigated or reviewed by the Board under formal agency adjudication procedures; Material Supervisory Determinations; Prompt Corrective Action; and Other Exclusions including appeals of adverse determinations under Freedom of Information Act (FOIA), requests made under NCUA's Touhy regulation, appeals of initial determinations made under the Privacy Act and consumer complaints to the agency.  NAFCU members can get more details on the exclusions and procedures outlined in the final rule in Final Regulation 17-EF-12 (your member login is needed).

NCUA's stated intent with this new rule is to provide "credit unions, and other persons or entities that are affected by agency decisions, with an opportunity to obtain meaningful review of those decisions. The Board believes this final rule strikes an appropriate balance that will afford a petitioner fair consideration of the issues while avoiding procedures that are overly burdensome, time consuming, and expensive".

Did you know that NAFCU has an Exam Fairness Guide that's available to members and to nonmembers on our website?  We are all aware that examinations can have a significant impact on a credit union.  This guide takes you through exam basics such as the goals of an NCUA exam, risk-focused versus defined-scope exams, frequency of exams and extended exam cycles. It also has helpful tips for navigating exam challenges, the appeals process and achieving fair exam outcomes.  The current guide reflects the appeals process as it stands today but will be updated in 2018 to reflect the new appeals process procedures.