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CUSO powers expanded by NCUA
WASHINGTON (12/19/08)—Credit Union Service Organizations (CUSOs)
Click to view larger image Before the start of yesterday's monthly NCUA Board meeting, Executive Director Len Skiles talks with CUNA Deputy General Counsel Mary Dunn. It was Skiles' last board meeting before he retires at the end of 2008, after a 36-year career with the agency. CLICK TO ENLARGE. (Photo provided by CUNA)
will now have authority under a new rule to offer two new categories of activities to credit unions: credit card loan origination and payroll processing services. The rule, adopted Thursday by the National Credit Union Administration (NCUA), also adds new permissible activities within existing categories and expands the scope of certain services to include persons eligible for credit union membership. New permissible activities under the board’s action are related to the routine daily operations of credit unions and include:
* Real estate settlement services; * Employee leasing and support; * Purchase of non-performing loans; * Business counseling and related services for credit union business member; and * Referral and processing of loan applications for members turned down by the credit union.
The changes will go into affect 30 days after the regulation is published in the Federal Register, and publication is likely to occur within the next week or so. Regarding the expansion of certain services to individuals within a field of membership who are not members of the credit union, the NCUA said allowing this authority for CUSOs reflects provisions in the Financial Services Regulatory Relief Act of 2006, which granted similar authority to credit unions. The NCUA modified a provision in its original proposal that would have given the agency access to the books and records of CUSOs that are owned by federally insured, state-chartered credit unions (FISCUs). The final rule adopts a procedure whereby a state credit union regulator can request an exemption for FISCUs in that state under certain conditions. An exemption may be granted if the state regulator has full rights of access to relevant books and records of the CUSO under state law and is willing and able to provide NCUA with equal access, and access must be available to the NCUA on its own timetable. For more information on the NCUA’s new CUSO rule, use the resource link below.
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