By Luke Mullins
A Washington advocacy group that supports credit unions' rights to convert to saving banks is suing the National Credit Union Administration in an effort to force the agency to ease its conversion regulations.
The Coalition for Credit Union Charter Options said in a press release Wednesday that the NCUA has "distorted" the conversion process with its "excessive rulemaking." Its suit, filed in federal court Wednesday, is intended to "restore balance, fairness, and clarity to the charter conversion process."
The coalition's executive director, Lee Bettis, was the president and chief executive of a Georgia credit union that converted to a savings bank in 2001. The group's two advisory board members are also one-time heads of credit unions that became banks. In its suit, the coalition accused the NCUA of throwing up bureaucratic hurdles in an effort to thwart conversions. The agency opposes conversions because fewer credit unions mean less income for its deposit insurance fund, the coalition said.
"They say they're trying to protect the consumer, but what they're really protecting is themselves,"Mr. Bettis said in a press release.
NCUA Chairman JoAnn Johnson said the agency's conversion rules are designed to help credit union members make informed decisions. "Consumers deserve more, not less, transparency and openness as they consider their choices," she said in a statement.