By Chris Bruce
Dec. 7 — The American Bankers Association today asked a federal judge in Washington to strike down a rule by federal credit union regulators that widens credit union membership standards ( Am. Bankers Ass’n v. Nat’l Credit Union Adm’n Board , D.D.C., No. 16-cv-02394, complaint filed 12/7/16 ).
The lawsuit came on the same day the National Credit Union Administration published the final rule in the Federal Register. The rule, scheduled to take effect in February, broadly redefines important measures relevant to credit union membership standards.
The ABA’s 22-page complaint said provisions in the final rule “expand the universe of members eligible to join a single federally-chartered credit union well beyond the limits established by Congress.”
NCUA spokesman John Fairbanks declined to comment on the lawsuit.
The lawsuit in the U.S. District Court for the District of Columbia marks the latest skirmish in a series of battles between credit unions, the NCUA, and the banking industry, some of which have had landmark results. In the late 1990s, bankers won a series of court battles over credit union membership based on multiple groups, including an important U.S. Supreme Court ruling.
However, Congress swiftly reversed that result by passing of the Credit Union Membership Access Act. The law, which authorized multiple group chartering of federal credit unions, was signed into law by President Bill Clinton in 1998.
The ABA’s lawsuit also is the second recent challenge to the NCUA. In September, the Independent Community Bankers of America sued to block a separate NCUA rule that eases restrictions on business lending by credit unions. The ABA said it will soon file a brief in that case in support of the ICBA.
To contact the reporter on this story: Chris Bruce in Washington at email@example.com
To contact the editor responsible for this story: Michael Ferullo at MFerullo@bna.com
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