WASHINGTON (11/11/05)—Credit Union National Association (CUNA) representatives went to the papers Thursday to set the record straight about recent unfair and misleading statements about credit unions.
In a letter to the editor appearing in American Banker, CUNA Senior Vice President John McKechnie took issue with a jibe from Richard Fisch, a partner in Malizia Spidi & Fisch PC, Washington, D.C.. Fisch claimed in an earlier letter to the paper that mutual thrifts are "member-owned financial cooperatives" just like credit unions, and therefore credit union taxation is inevitable.
"Oh really?" responded McKechnie in his letter, "Then why aren't mutual thrifts lining up to convert to a credit union charter and thus become eligible for a federal tax exemption?"
The reasons, McKechnie said, are that mutual thrifts would have to:
- Switch to volunteer rather than paid boards of directors;
- Do away with weighted voting in favor of true "one member-one vote" democracy;
- Give up proxy voting and the tight insider control that comes with it;
- Limit customer base to a specific field of membership; and
- Operate under a regulatory structure that has tighter restrictions on business lending, investments, and capital.
"Nice try, Mr. Fisch, but mutual thrifts simply cannot make the same claim, no matter how they misunderstand or deliberately misinterpret the real distinctions that exist," McKechnie wrote.