Online Petition Calls For Changes To CU Regulation
LIVONIA, Mich. — A petition circulated online by the head of a Michigan CUSO has sparked debate over how credit unions should make their voices heard to NCUA and the Federal Reserve.
Randy Karnes, CEO of the Grand Rapids, Mich.-based CU*Answers, circulated a petition nationwide to CEOs and CUSO leaders that called for a number of changes to how credit unions are regulated, including Congressional oversight of the NCUA board and splitting the NCUSIF from the agency.
David Adams, president and CEO of the Michigan CU League, told Credit Union Journal that while the intent of the petition is sound—encouraging credit unions to raise their voices—the process is wrong.
"I raise a serious process issue," said Adams, who earlier this week sent an e-mail to CEOs in this state sharing his concerns over Karnes' petition. "Hopefully we have learned over the years that if we are divided in our approach and in our message, Congress will not take us seriously. This (petition) just serves to splinter us further by disregarding the important role of trade associations."
Karnes countered by questioning if CUs "have lost their voice. Have we lost our ability to act as individuals? Are we afraid of retribution? Have we been mesmerized by our lobbyists and associations to the point where we don't think we have to speak up anymore? Or, are we afraid to speak up?"
Karnes noted that CUSO leaders and credit union CEOs nationally are not satisfied with how CUNA and the leagues are addressing the corporate crisis.
Karnes told Credit Union Journal that the online approach was chosen to create a viral message legislators would pick up. "But it appears to me that our (state) association says the only way to effectively speak to anyone is through a groomed agenda. I truly believe today that politicians and regulatory agencies are listening to the net. So we all think that the only way to further the credit union agenda is to pay lobbyists or to march the Hill?"
In addition to Karnes' method, Adams is concerned the petition's message may harm credit unions. "The petition calls for additional Congressional scrutiny on the NCUA, which would be absolutely the wrong thing for credit unions now. In the aftermath of the financial crisis and at a time of budget crisis, Congress is more likely to streamline agencies as opposed to creating a new one. So asking for additional Congressional scrutiny or lambasting our regulator publicly risks losing our independent regulator, which would be far worse for our industry than many of the challenges we are dealing with now."