The Supreme Court’s recent denial of the American Bankers Association’s appeal in a case challenging the National Credit Union Administration’s 2016 field of membership rule “is another unfortunate step toward America’s credit unions becoming nothing more than banks that refuse to pay federal income taxes,” ABA Chair Laurie Stewart said today.
In an op-ed for the Credit Union Journal, Stewart—a former credit union CEO who is today president and CEO of Sound Community Bank in Seattle—noted that relaxing field of membership rules is yet another move by the industry and NCUA to create an unlevel playing field between tax-exempt credit unions and taxpaying banks. “Eliminating the field of membership requirement is a gross perversion of the mission and purpose of credit unions as conceived by Congress in 1934 and a brazen money grab by America’s largest credit unions to gather more members, make more loans and drive small banks out of business through unfair, taxpayer-subsidized competition,” she said. “If credit unions want to act like banks, all we ask is that they play by the same rules.”
The 2016 field of membership rule enables NCUA to define a “local community” as a combined statistical area inhabited by up to 2.5 million people or define an entire state as a “rural district.” ABA had petitioned the Supreme Court to review a lower court ruling last year that upheld much of the rule.
“My bottom line on their bottom line?” Stewart added. “Enough with the special privileges to support a mission that was long ago forgotten by the big credit unions. Enough with not paying their fair share and sticking taxpayers with the bill. Enough with exploiting their poorest members to enrich the very largest and richest credit unions in our land.”