NCCUD Endorses H410: Heaven Scent ...

   ... or Le Pew?

One last round on last weeks' North Carolina Credit Union Commission Meeting.  The results were three significant inactions: 

✓ 1) the Commissioners kowtowing to the N.C. Attorney General's opinion that their sole role under State law is to sit quietly, 

✓2)  the CU Administrator's continuing refusal to answer the question: "Does the NC Administrator of Credit Unions permit NC credit unions to deny eligible, qualified members the right to seek self/membership nomination to serve on the credit union board?   Y/N"; and 

✓3) the Division was confronted [link to Eclipse of CUs #3] over its 2023 endorsement of H410 before the N.C. Legislature - the crickets were deafening on that one too! [see link: Regulatory Capture issue]

Hope you will take a few moments to check out the links above. As the speaker correctly points out:  

✅ "H410 is a boondoggle."

The N.C. Legislature reconvenes for its "Short Session" on April 24th and H410 remains in the hopper for consideration. So, get ready again for a "street fight on Jones" over the bill. The Legislature was purposefully misled last year by promises that H410 was no more than a few minor "CU Updates"!

✅ About as far from the truth as you can get! Here's a refresher of what H410 really changes:

👎  H. 410 is not a "minor update" to credit union statutes; it is a major rewrite.

👎 H. 410 authorizes unlimited membership, anyone can join. And, would overturn a 1981 N.C. Supreme Court ruling affirming limited membership as the intent of N.C. law

👎 H. 410 authorizes open membership including corporations anywhere in the country.

👎 H. 410 de-emphasizes the focus on North Carolina and citizens of modest means. Proponents have consistently rejected a specific mandate to serve these individuals. 

👎 H . 410 permits unlimited lending, including unsecured, to corporations.

👎 H. 410 will accelerate the export of local jobs, local funds, and local capital out of North Carolina, undermining the State's efforts at business recruitment and development - especially in rural counties.

👎 H. 410 will enhance "federal parity" for credit unions, which is a device to circumvent scrutiny and approval of North Carolina standards by the State Legislature.   

👎 H. 410 has disrupted a positive detente in the rivalry between N.C. banks and credit unions and will "unlevel" the competitive balance between the two groups,

👎 H. 410 does not enjoy united support among N.C. state-chartered credit unions and is opposed by thousands N.C credit union members and groups such as the State Employees Association of North Carolina (SEANC).

👎 H. 410 does not represent the best interests of all of North Carolina, nor those specific citizens who are credit union member-owners. If credit union statutes need to be rewritten, H. 410 is not the answer. 

... lets hope that H410: "The CU Le Pew Bill" finds a home in a ditch by the side of the road! 

 

 

The Guiding Light ...

  ... a CU soap opera in action?

An extended discussion broke out in the "Comments" section of yesterday's post [link to post], concerning the board nomination process at SECU. Thought most folks had grown tired of the faux drama over at the N.C. Credit Union Division, but one more episode won't hurt.

✅ All credit unions use a nominating committee to select members to run for vacant board seats. The nominating committee is generally selected by the board chair. The nominating committee can establish rules, procedures, policies to govern its selection of a slate of candidates to run. So, lets simplify it; the SECU Nominating Committee has the full right to create applications, interviews or any other hurdles it chooses to make its selections. Got it? Full right. 

Okay then, why is the SECU Nominating Committee operating illegally with the support of the N.C. Credit Union Division? Because there is a second, separate, parallel process for credit union members to put forth their names as board candidates. That second, separate, parallel process is called "self-nomination". All credit unions have this second, separate self-nomination process to permit members to run independently, if supported by the membership. You saw this independence in action at the 2023 Annual Meeting as the SECU membership gave the incumbent Nominating Committee candidates the boot!

At SECU last year, the SECU Nominating Committee denied a qualified member, Ms. Susie Ford, the opportunity to self-nominate - nobody questions that Ms. Ford, as a member, was personally eligible and qualified. Under the law and bylaws, denying her the opportunity to self-nominate was, again illegal. SECU has falsely claimed that the Nominating Committee had the right to do that, with an SECU attorney on a WebEx even quoting federal legal opinions in support!

What's interesting about those legal opinions [here's where you can look at those multitude of legal opinion for yourself] is the SECU attorney was right as far as he went. He was able to find the parts which give a nominating committee full rights in choosing its slate (see ✅ paragraph above), but his legal impartiality seemed blind to this part:.

"There are, however, no restrictions on the eligibility requirements that a nominating committee can use in selection candidates for office. We have previously stated that the nominating committee is free to set reasonable standards as to whom it will nominate. Failure to be nominated by the committee, though, does not preclude a member from running for office."

😎 This "selective vision" by the SECU Board - this use of "half truths"- when "talking down" to the members and staff is really what this soap opera is about - at heart.

 

... "the soap" first hit the fan with that infamous, weaselly: "No formal proposal proposal" from the "We Are" chair. 

A slippery slide since... stay tuned, more drama ahead!