On December 13, 2005, Representative Jeb Hensarling (R -TX) requested that the Government Accountability Office (GAO) investigate how the National Credit Union Association (NCUA) addresses the conversion of federally insured credit unions to mutual savings banks.
Representative Hensarling requested this review after two Texas credit unions requested redress from a federal court in order to complete their conversions.
For those individuals not familiar with the issue, NCUA had invalidated the conversion votes of the two Texas credit unions over how a single two-sided sheet of paper was folded as part of the mailing to the credit unions’ memberships.
Representative Hensarling in his letter posed 3 issues that he wanted the GAO to examine:
- Whether the NCUA’s actions conform with, or exceed, the powers granted by the 1998 Credit Union Membership Authorization Act (CUMAA) which grants the NCUA the authority to oversee the methods and procedures of a conversion vote.