Bankers Suit Challenges NCUA'sUnderserved Expansions
WASHINGTON - (11/01/05) -- The American Bankers Association, alongtime legal nemesis of NCUA, said Tuesday it has filed two morefederal suits challenging the credit union regulator's field ofmembership policies. In the first suit, filed in federal court inUtah, the Bankers claim that NCUA's practice of allowing communitychartered credit unions to add large low-income communities totheir FOMs under its underserved policy violates provisions of HR1151, the CU Membership Access Act, which reserves underservedexpansions to multiple group credit unions. The suit, filed in thesame court that last year struck down a broad community charterapproved by NCUA, claims that one of the same credit unions,America First FCU, has used the underserved expansion to skirt thecourt's ruling. A second suit, filed in federal court inHarrisburg, Pa., claims that a broad seven-county community chartergranted NCUA to three Pennsylvania credit unions violatesprovisions of HR 1151 requiring that such community FOMs constitutea "well-defined local community, neighborhood, or rural distric.""We intend to use the courts to force NCUA to follow the law," saidABA Chief Edward Yingling, in announcing the legalactions.