The state legislature's Post Audit Committee, based on prompting from the Kansas Bankers Association (KBA) has initiated a review of the state's oversight of credit unions.
The review, formerly requested by the legislature's Financial Institutions and Insurance Committee, will try to determine whether the Department of Credit Unions is properly overseeing interstate branching, field of membership, and safety and soundness of the 98 state-chartered credit unions in Kansas, according to Chuck Stones, president of the KBA, who convinced the legislature to ask for the audit.
Stones said their interest was prompted by the American Bankers Association's "Operation Credit Union," which seeks to shine the spotlight on credit union practices and regulatory oversight in the states, but he insisted it is not an attack on the tax exemption.
"Frankly, I think credit unions are paranoid and single-minded in what the banking industry may have in mind for them," he told The Credit Union Journal.
The bankers' concern, he said, has been piqued by the operations of credit union giant Community America Credit Union, which serves the entire state of Kansas but is headquartered in Kansas City, just over the state line; and by the oversight of U.S. Central Credit Union, the central bank for credit unions, which is regulated by the state, among other things, said Stones.
"There's some interesting things going on in Kansas," said Stones. "I'm not saying that (CU Supervisor) Jerel Wright is doing a bad job. We just want a third-party, independent, unbiased review of the whole situation."
