Big Question: What About Fate of Paper Records?
Credit union managers allowed back in to the partially submerged buildings last week, most of them for just brief periods, were struggling to save any paper records that may have been lost to the floodwaters unleashed by Hurricane Katrina.
NCUA and state examiners were working with credit union officials to save records that had not been secured or put on computer disc, as required under regulations. "The focus right now is to assist credit unions and credit union member and victims of the disaster," said Regina Metz, a staff attorney with NCUA working on the agency's newly constructed Hurricane Katrina Task Force. "We are working to help them get back on their feet."
"All federally insured credit unions are required to have a records-preservation program in place and they are required to have a vital records center storage facility far enough away to avoid simultaneous loss of both sets of records," said Metz. There is no specific distance requirement for the separate records storage.
However, she noted, the breadth of the flooding in New Orleans and other Gulf Coast states means that in some instances both sets of records may be damaged or destroyed. "Who knew the extent of the disaster could affect both sets of records," she noted.
NCUA regulations also require that federally insured credit unions obtain flood insurance on all properties sitting in a predetermined flood plain.
The extent of compliance with either or both of these regulations is undetermined, as NCUA and relief organizations continued last week to focus on saving lives. "This is still being sorted out," said Metz.
NCUA, said Metz, is urging members, some of whom were calling the agency's toll-free hotline, to try to find and save their own records, as many credit union records were expected to be destroyed and unrecoverable.
The Federal Emergency Management Agency was urging victims of Hurricane Katrina last week to work to recover as many documents as possible. While many of those personal documents may be destroyed by flooding or fire or other incidents related to the hurricane, third-party providers, such as insurance agents, securities brokers/dealers, banks and lenders outside the affected areas may be able to help.