Court invalidates parts of NCUA’s FOM rule

The U.S. District Court for the District of Columbia on Thursday upheld two challenged portions of NCUA’s field of membership rule and struck down two provisions in a lawsuit filed against the agency by the American Bankers Association (ABA).

The provisions declared to exceed the NCUA’s statutory authority include those that automatically qualify a combined statistical area (CSA) with fewer than 2.5 million people to be a local community and the increase to 1 million people the population limit for rural districts.

The court ruled in favor of the NCUA’s rule on all other provisions.

“Our organizations are pleased the court upheld components of the NCUA’s field-of-membership rule; however, we strongly disagree with the court’s decision that aspects of the rule exceed the agency’s legal authority,” said NAFCU President/CEO Dan Berger, CUNA President/CEO Jim Nussle and CUNA Mutual Group President/CEO Robert Trunzo. “The field-of-membership rule is not only entirely consistent with the Federal Credit Union Act, but also credit unions must have the ability to grow and serve more Americans. As the parties consider their options going forward, we will continue to support the agency on this critical issue.”

 

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