Final bylaws rule on member expulsion, mid-sesson budget slated for Thursday NCUA Board action

A final rule that would create within Appendix A of the agency’s federal credit union (FCU) standard bylaws a policy for expelling members who may be a threat to others is slated for action during Thursday’s open meeting of the National Credit Union Administration (NCUA) Board.

The board is also slated to address the agency’s mid-session budget.

Under the current bylaws, an FCU could expel a credit union member in one of two ways: by a two-thirds vote of the membership present at a special meeting called for that purpose; and for non-participation in the affairs of the credit union as specified in a policy adopted and enforced by the board.

The agency’s proposal, released in September under a statutory requirement enacted in March 2022 (under the Credit Union Governance Modernization Act), would provide that an FCU could expel a member for cause by a two-thirds vote of a quorum of the FCU’s board of directors, without a special membership meeting.

This authority was provided in the law to address concerns about violent or belligerent members, but it requires that the NCUA develop a policy within 18 months of enactment. Both the statute and information in the NCUA proposal underscore that such action should be rare and reserved for egregious examples of member behavior.

Thursday’s meeting begins at 10 a.m. and can be viewed in person and online via the NCUA’s YouTube channel.

NCUA Board agenda for July 20 open meeting

NCUA YouTube channel