NCUA: NC AGENCY VIOLATED PROTOCOL IN CAMEL CASE
ALEXANDRIA, Va.-An internal review conducted by NCUA's Office of the Inspector General on events surrounding last year's NCUA dispute over North Carolina State Employees' CU's disclosure of its CAMEL code concluded that the North Carolina regulator violated a bilateral agreement with NCUA by giving the credit union giant a draft document of resolution that is supposed to be reserved for regulatory use.
But the report failed to determine whether the $25-billion CU's disclosure of its CAMEL code violated NCUA rules and regulations. "They never asked us to look into that," said William DeSarno, NCUA's IG.
The IG also was not asked to probe a variety of retaliatory actions brought by NCUA against the long-time North Carolina regulator, including the agency's insistence that North Carolina CU Division Administrator Jerrie Jay have no leadership role in NASCUS. Or why NCUA never interviewed SECU about its decision to publicly disclose its CAMEL code.
The IG was unable to determine whether Jay told SECU directors at a December meeting with NCUA executives that NCUA was threatening to pull the CU's share insurance over the dispute, as one senior NCUA executive alleged. According to audiotapes of the board meeting, Jay appeared to be goading NCUA executives into threatening to suspend SECU's share insurance, but there was no smoking gun, the report concluded.
The allegations were among those tossed back and forth between the nation's biggest state-chartered CU and NCUA, which chose to penalize the state regulator for her acquiescence in the CAMEL code disclosure. Consequently, NCUA decided to require that all 48 state-chartered CUs that normally undergo just state examinations, also undergo NCUA examinations as well, at additional expense.
The dispute raised several issues, including states' rights in determining issues such as the public disclosure of CAMEL codes, which rate a credit unions' financial health.
According to NCUA's DeSarno, while the CAMEL code disclosed by SECU was the state's own rating, and not NCUA's CAMEL code, it is considered part of NCUA's regulatory system, which is protected under a bilateral agreement NCUA has with each state.
SECU CEO Jim Blaine said he is unsatisfied with the IG's report and is still convinced that public disclosure of CAMEL codes is good for members and for the public. "This is not about CAMEL, it's never been about CAMEL," said Blaine. "It's about regulatory reform and the need for more transparency."
An angry Blaine continues to be dismayed at NCUA response to his credit union's decision to publicize its CAMEL rating, saying his own attorneys and those for the state regulator found nothing illegal in it. His anger, he said, continues over NCUA's punitive actions against the state supervisor. "They have trashed our state regulator and they did it without good reason," said Blaine. And they have penalized 48 (state-chartered) North Carolina credit unions that didn't do anything at all."
SLEW OF ADA ATM LAWSUITS
POSE NEW LEGAL THREAT TO CUS
WASHINGTON-Financial institutions are looking at a new legal exposure in an emerging flurry of lawsuits over the Americans with Disabilities Act and its requirement to make all of their ATMs accessible to the visually impaired.
A legally blind consumer filed a dozen suits against local financial institutions-the most recent last week against Pittsburgh's Century Heritage FCU-claiming the ATM owners failed to meet the March 15 deadline for making all ATMs accessible to the visually impaired. The suits all seek class action status on behalf of visually impaired consumers.
In the suit, Robert Jahoda, who describes himself as legally blind, visited the Century Heritage ATM in nearby McKeesport after the ADA compliance deadline and the machine was not fully accessible to or independently usable by blind people, as there were no voice functions or Braille keys at the ATM to make it compliant. Jahoda says based on investigation on his behalf he believes the other CU's ATMs are also non-compliant.
The non-compliance, claims Jahoda, "threatens blind people with the loss of their private banking information. Blind people who wish to use certain of Defendant's ATMs have no choice but to repeatedly reveal their private PINs to others to complete an ATM banking transaction."
The new series of suits comes as credit unions are fighting off a growing number of actions on ATM disclosures under the Electronic Funds Transfer Act and a variety of consumer suits over the Fair Credit Reporting Act.
The ADA delineates guidelines for ATM owners to make their machines accessible to the visually impaired, including making them speech enabled; having tactile controls for touch and providing Braille instructions for initiating the speech mode.
Jahoda said when he visited the Century Heritage ATM he had with him a valid ATM card and headphones compatible with 2010 standards for ADA access but the CU's ATM was not adequately equipped.
He has asked the court for a declaration that Century Heritage is in violation of the ADA and a permanent injunction requiring it to make all of its ATMs comply with the law, as well as an order to have the credit union pay costs of the suit and legal fees.
Jahoda has also filed similar suits against Home Savings and Loan Co. of Youngstown, Ohio; 1st National Community Bank; Charleroi Federal Savings Bank; Fidelity Bank; Commercial Bank and Trust of Pennsylvania; First Commonwealth Bank; Citizens Bank of Pennsylvania; PNC Bank; First Niagara Bank; Huntington National Bank and Northwest Bancorp.
