NCUA's furniture fiasco highlights personality conflicts on the board

The National Credit Union Administration’s attempt to sell off former Chairman Mark McWatters’s old office furniture may end up as a bust.

The agency last week launched an online auction to dispose of four items purchased for McWatters’s office when he joined the board in 2014. He resigned from the agency in November following a dispute with then-Chairman Rodney Hood.

Originally acquired for about $21,000, as of Wednesday morning the auction had just one bid totaling $2,500. With less than 12 hours left to bid, an $11,000 reserve price had not been met. The agency said the items may not be sold if the reserve isn't met.

The process has revealed more about the agency's interoffice dynamics.

“I have never seen such pettiness between board members, especially ones from the same political party,” said a former board member who asked not to be named. Hood and McWatters are Republicans.

The NCUA has never attempted to auction a former board member’s furniture, an agency representative said, and the move is not indicative of any new policy. The sale, directed and approved in December by Hood in his capacity as chairman, was organized by the chief financial officer’s office, the representative said.

Hood’s chairmanship ended Jan. 20, when President Joe Biden elevated board member Todd Harper to the post. Harper did not learn about the auction until Hood tweeted about it on Feb. 19, two days after the auction had begun. McWatters said in an email that he asked Harper to consider stopping the process but has not received a response.

The NCUA does not always buy new furniture for board members, and the agency said no new items were purchased when Hood, Harper or Vice Chairman Kyle Hauptman joined the board, meaning the purchases for McWatters’s office are the most recent. If the auction is successful, any proceeds will be credited to the regulator’s operating fund as miscellaneous revenue, offsetting overall costs, the agency said.

Many in the industry have questioned whether it’s worth it for the NCUA to sell off furniture at a loss rather than repurpose it. The anonymous board member said Hood’s decision to tweet about the issue — including recirculating Washington Post coverage of an expense-reimbursement scandal during McWatters’s chairmanship — was “totally unprofessional” and represented “a personal grudge that should have ended the day McWatters resigned.”

Others were reluctant to comment on the issue, but Chip Filson, co-founder of the consultancy Callahan and Associates, suggested there are bigger issues for credit unions to keep their eyes on.

“How the board members or examiners spend their time and internal issues [are] not where I would want to focus credit unions’ attention,” he said, adding that the possibility of new premiums for the National Credit Union Share Insurance Fund and other topics from the agency’s February board meeting are more pertinent.

“There are a lot bigger issues and topics that credit unions should rightly focus on,” he added.