NCUA: FCUs Can't Offer Non-Members Investments
NCUA said a federal credit union is not permitted to provide investment services to non-members by using a shared employee with a broker/dealer. In a new legal opinion issued last week to Linsco/Private Ledger, the credit union regulator said an FCU has no authority to provide investment services to non-members and using a dual employee does not change that. Linsco/Private Ledger asked NCUA whether it could contract with Hughes FCU, rather than the credit union's CUSO, to expand its customer base and serve members of other credit unions. But NCUA said if the credit union were to engage in this relationship it could not share in any revenue generated or be reimbursed for its expenses for services to non-members.
In the same legal opinion, NCUA also said an FCU cannot provide broker/dealer services as a correspondent service to members of another credit union.