NCUA Invalidates Member Disclosures OnCommunity CU Bank Bid
ALEXANDRIA, Va. - (05/24/05) -- NCUA said Monday it has notifiedCommunity CU that 225,000 member disclosures the credit union giantsent out explaining the impending vote to convert to mutual savingsbank are in violation of the agency's regulation, invalidating thevoting process. "They're going to have to do it all over again (ifthey want to proceed with the vote)," NCUA spokesman Nicholas Owenstold The Credit Union Journal Monday. NCUA ruled the $1.4 billioncredit union improperly publishd a rebuttal to required disclosureson the front of a two-sided document, so that members were able toread the credit union's own explanation of critical NCUAdisclosures on insider remuneration, voting rights and ownershiprights before they were able to read the required disclosures, thustainting the disclosures, Owens said. The credit union hadapparently agreed to send the disclosures on separate pages butviolated the agreement, he said. If the Plano, Texas, credit unionwants to proceed with its controversial conversion, the biggestever for a credit union, it will have to reprint the disclosuresand send them out twice more.