ABA Wants Court to Rehear Case on NCUA's FOM Rules; Trade Groups Respond

WASHINGTON –The American Bankers Association (ABA) is calling on the U.S. Court of Appeals for the D.C. Circuit to rehear an earlier decision it made that largely ruled against the bank group and upheld NCUA’s new field of membership rules.

In response, NAFCU, CUNA and CUNA Mutual Group all issued a joint statement in  support of NCUA’s 2016 field of membership (FOM) rule. 

As CUToday.info reported here, the appeals court panel decision in August was largely in favor of the NCUA.

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The court, where three federal judges heard oral arguments in April of this year, ruled in a case in which NCUA had appealed a March 2018 district court ruling that had struck down portions of the expanded FOM rule approved by the NCUA board. 

The court remanded the portion of the rule—without vacating it entirely—that addressed core-based statistical areas “for further consideration of the discriminatory impact it might have on poor and minority urban residents.” The provision permits credit unions to serve core-based statistical areas without serving the urban core that defines the area, an issue in the case that was the subject of questioning by the judges when the case was heard. 

NCUA prevailed in its appeal of a district judge’s decision that had vacated portions of the agency’s new FOM rule related to combined statistical areas and rural districts as “local communities.” In upholding these portions, the court cited the doctrine of Chevron deference, which gives wide latitude to administrative agencies to interpret their authorizing statutes. 

At the time of the ruling, the ABA had said it was considering its next steps. 

NAFCU Response

“NAFCU stands firmly with the NCUA, and its efforts to modernize credit unions’ field of membership rules,” said NAFCU President and CEO Dan Berger. “While the ABA continues its meritless attacks against credit union growth and competition, NAFCU will continue to support FOM modernization so that credit unions can serve their members, including the underserved, which banks have so often left behind. NAFCU strongly believes in the credit union industry’s cooperative, not-for-profit mission, and that credit unions provide the best financial solutions the marketplace has to offer.”

CUNA Response

“The D.C. Circuit Court of Appeals found that credit unions are an important part of America’s financial tapestry,” said Jim Nussle, CUNA president/CEO. “That the bankers continue to spend time and resources to limit consumers’ access to responsible financial services is telling in how we approach our service to communities across the country.”

CUNA Mutual Response

“CUNA Mutual Group continues to stand by NCUA and its authority to interpret the Federal Credit Union Act,” said Phil Tschudy, CUNA Mutual Group spokesperson. “We will continue to work diligently with CUNA and NAFCU to defend and promote credit union field of membership.”

Section: Standard
Word Count: 631
Copyright Holder: CUToday.info
Copyright Year: 2019
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URL: http://www.cutoday.info/Fresh-Today/ABA-Wants-Court-to-Rehear-Case-on-NCUA-s-FOM-Rules-Trade-Groups-Respond