Bankers File New FOM Suit InKentucky
FRANKFURT, Ky. - (06/13/06) In another legal action broughtby the banks to thwart credit unions, Home Federal Savings and LoanAssociation, in concert with the Kentucky Bankers Association, hassued the state Department of Financial Institutions challenging itscommunity chartering powers for credit unions. The suit, filed inFranklin Circuit Court, claims the state regulator does not havethe authority under the state statute to grant community charters.The bankers suit comes as the DFI is preparingadministrative rules to allow state chartered credit unions toadopt community fields of membership, something allowed in almostevery other state. The bankers have filed more than 20 FOM suitsagainst credit unions, with challenges pending in federal courts inUtah and Pennsylvania, and in state courts in Pennsylvania,Missouri, as well as Kentucky. Officials with the Kentucky CULeague vowed to join the suit on behalf of the DFI. We planto wage a strong and vigorous defense, Wendell Lynons,president of the league, told The Credit Union Journal.