WASHINGTON-Some observers are saying there are potential questions about last week's presidential nomination to the NCUA Board of Washington, D.C. credit union CEO Carla Leon-Decker, who would be the second former CU executive to be sitting on the three-member panel.
But others say the law is vague and there is no potential issue with provisions of the Federal CU Act that limit the Board to one member who is or has "recently been involved with any insured credit union."
Leon-Decker, currently president of D.C. Government Employees FCU, would be the second credit union manager on the panel, joining Chairman Debbie Matz, who was nominated to the NCUA Board in May 2009, nine months after she ended her executive tenure at Maryland's Andrews FCU.
Matz's ties to the credit union movement, even while another sitting member of the NCUA Board, Gigi Hyland, who was a former legal counsel for corporate credit unions, were never questioned during her confirmation hearing before the Senate Banking Committee, even though the purpose of the provision in the law is to prevent the federal regulatory panel from being too closely tied to the industry.
"The reason to limit the number of Board members at the time of their appointment to one individual with recent involvement with insured credit unions is to guard against the agency being captured by the industry it regulates," said Keith Leggett, a spokesperson for the American Bankers Association.
But officials with CUNA say the wording of the statute is unclear on the provision.
According to CUNA General Counsel Eric Richard, there is no definition of "recently" served in the statute. In addition, there is no mechanism in the statute to enforce the restriction. "So whether someone's service is too 'recent' is a political question, to be judged by the Administration that nominated Mss. Matz/Decker and the Congress which confirms them."
Richard pointed out that this sort of "exclusion provision" only appears in the Federal CU Act - there is no similar provision regarding bankers in any of the statutes governing the bank regulatory agencies. Historically and currently, bankers have been and are well represented on the boards of the Fed and FDIC, and in the top position(s) at OCC and the former OTS.
"In our view, this provision is inherently discriminatory against credit unions vis-Ã-vis banks, other financials," he asserted.
Leon-Decker, born and raised in Lima, Peru, has been at the now-$48 million D.C. Government Employees FCU since 2001. Before that, she was an operations manager, then president of PAHO/WHO FCU. She is also a founder of the Network of Latino Credit Unions & Professionals.
If she is confirmed, as required, by the Senate, she would succeed Hyland, whose six-year term on the Board expired in August. She is a Democrat and would allow the Democrats, along with Matz, who is also a Democrat, to retain a two-to-one majority on the bipartisan panel (Michael Fryzel is a Republican) for another four years.
