NCUA Vice Chairman Kyle S. Hauptman during a meeting of the NCUA Board in Alexandria, Virginia.
As Prepared for Delivery on September 19, 2024
The comment period for the rule opened November 7, 2023, and closed on January 8, 2024. Thank you to the ten commenters who took the time to give us their thoughts. All expressed their support. One commenter also suggested clarifying language around the requirement for fidelity bond coverage. This commenter felt the language was not clear that eligibility for credit union service did not make the candidate automatically eligible for fidelity bond coverage. The Board agreed and language was clarified around that issue.
There are several reasons I am pleased to see this rule move forward. First and foremost, it is in synch with the culture of the credit union movement. While the NCUA isn’t part of that movement, it’s easier to implement rules that align with an industry’s culture. Credit unions were one of the original answers to the challenges of financial inclusion. We must thoughtfully consider any decision to exclude individuals and groups from employment or service on the board of directors.
Second, this final rule gives more people the opportunity to work in a business where inclusion is at the core of its existence. This is good for individuals and credit unions. With today’s labor market, few employers are immune to the challenges of hiring. There is a massive array of potential workers out there who have paid their debt to society, or whose offenses are relatively minor. The final rule cuts out lesser offenses and expands on exceptions. It gives greater flexibility for a credit union to hire an individual with certain covered records or allow them to serve on the board of directors.
The rule also delivers regulatory relief by reducing the instances where a credit union must apply to the NCUA to hire a candidate. At the same time, it reduces the resources required to investigate those applications that still need to come to the agency for approval.
Significant effort has gone into the public-facing side of this rule. Once approved, the agency’s website will be updated with forms and instructions related to consent applications. This is intended to make it easier for potential candidates to find out if they qualify for employment without the NCUA’s prior consent. It relieves the credit union from having to apply.