Board of Director Liability

A credit union director (or officer) is referred to as a fiduciary by law. This means a director holds a position of trust. A director has an affirmative duty to care for the property of others and can be held liable for failing to perform that duty. Because the members of a credit union are too numerous to handle any but the most basic decisions for the credit union, the law provides for them to elect directors/fiduciaries to act on their behalf.

The position of volunteer is not a shield of immunity from personal liability. A volunteer bears these duties:

  1. A duty of loyalty. A director must be focused solely on, and be faithful to, the required duties and responsibilities of fulfilling his or her role as a director. Directors must never engage in self-dealing or self-serving transactions. An example of this would include a director persuading other board members to utilize a board member's spouse to handle credit union investments and to purchase the investments through the spouse's employer.
  2. The duty of due care. This is displaying the degree of care, which an ordinarily prudent and diligent person would exercise under similar circumstances. Further, if the credit union is suffering financial problems, directors are required to devote extra time and effort to the affairs and activities of the credit union.

NCUA recently added regulations further defining the fiduciary duties of directors of federal credit unions, in NCUA Regulations Part 701.4. These regulations provide guidance on the above duties of Loyalty and Due Care, and require the director to “carry out his or her duties as a director in good faith, in a manner such director reasonably believes to be in the best interests of the membership of the Federal credit union as a whole, and with the care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances.” A director also must administer the affairs of the Federal credit union fairly and impartially and without discrimination in favor of or against any particular member and direct management's operations of the Federal credit union in conformity with the requirements set forth in the Federal Credit Union Act, applicable law, and sound business practices.

For additional information, click here for the topic.

Review the information today to help your credit union remain in compliance.


NCUA Consumer Assistance portal now open

The NCUA has announced that credit unions can now use a portal, located on the NCUA’s site, to receive correspondence from the Consumer Assistance Center about complaints concerning them, to send responses and complaint information, and to check the status of complaints concerning their institutions that were filed with the Consumer Assistance Center since August 24, 2015. Information contained within the portal is not accessible by the public. A set of FAQs regarding the portal was also posted on the NCUA website.

Source: NCUA

Panel discussion on reaching Hispanic members

A free panel discussion, "Unique Challenges and Opportunities Serving Hispanic Credit Union Members,” will be hosted by the NCUA on December 1, 2015, from 2 p.m. to 3:30 p.m. ET, at NCUA’s Central Office, 1775 Duke Street, Alexandria, Virginia. Seating is limited to the first 100 registrants.

Source: NCUA

FFIEC Releases Revised Management Booklet

The Federal Financial Institutions Examination Council (FFIEC) members recently issued a revised Management booklet, which is part of the FFIEC Information Technology Examination Handbook (IT Handbook).

The Management booklet, including the examination procedures, has been substantially revised. The booklet outlines the principles of sound governance and, more specifically, information technology (IT) governance. The booklet explains how IT risk management relates to enterprise-wide risk management and governance.

The updated examination procedures assist examiners in evaluating the following areas:

  • IT governance as part of overall governance in financial institutions.
  • IT risk management as part of enterprise-wide risk management in financial institutions.

Other relevant changes include:

  • Incorporation of cybersecurity concepts as part of information security.
  • Incorporation of management-related concepts from other booklets of the IT Handbook.
  • Augmentation and further delineation of the stages of the IT risk management process, including risk identification, measurement, mitigation, monitoring, and reporting.

The IT Handbook is available at

NCUA Publishes FFIEC’s Cybersecurity Assessment Tool Videos

Credit unions now have another resource from the National Credit Union Administration to help them use the Federal Financial Institutions Examination Council’s cybersecurity assessment tool to evaluate their ability to address cyber risks. The video provides an overview of how the assessment tool works. The assessment tool can help credit unions pinpoint strengths and weakness in their cyber security programs.

Source: NCUA


CU Advocacy This Week

Field of Membership Proposal Expected to be Released Thursday

This week, NCUA is expected to propose a new field of membership regulation that incorporates several of the recommendations CUNA proposed earlier this year

As part CUNA’s ongoing and comprehensive effort to improve the operating environment for credit unions to serve their members, they encouraged NCUA to adopt new field of membership regulations that recognize and adapt to the changes that have taken place in the marketplace and in how credit unions serve members. CUNA encouraged the agency to take immediate administrative action in areas that did not require a change in regulation, to propose new regulations to expand consumer and small business access to credit unions, and to support statutory changes that go beyond what is presently permitted by law. 

The first fruit of this effort took place last month when NCUA shaved at least two months off the amount of time necessary to expand a community charter by delegating approval authority to the Office of Consumer Protection. Previously these approvals required a full vote of NCUA's board. 

Here are some things CUNA recommended:

  • Include a combined statistical area in the definition of well-defined local community.
  • Allow a Congressional district to be considered a well-defined local community (this would allow credit unions to serve an entire state in a state that has only one Congressional district).
  • Eliminate the population test associated with the definition of "rural district."
  • Reinstate a narrative approach for defining a community.
  • Eliminate the geographic limitations on TIP charters.
  • Allow TIP charters to serve independent contractors and others who support the work of the TIP.
  • Allow groups with 3,000 or more potential members to more easily be added to multi-group federal credit unions. 

The proposal is expected to be released on Thursday, 11/19/15.

CUNA Seeks “Yes” Vote on House Bill Addressing QM Loans

WASHINGTON (11/17/15)--CUNA is encouraging U.S. House lawmakers to vote yes this week on a measure that would remove barriers for credit unions. The Portfolio Lending and Mortgage Access Act (H.R. 1210) would allow credit unions, and other lenders, to treat mortgages held in portfolio as qualified mortgages (QM) for purposes of the Consumer Financial Protection Bureau’s (CFPB) mortgage lending rules.

"Treating loans that financial institutions hold on their balance sheets as a QM loan is appropriate because the lender retains all of the risk involved with these mortgages and is subject to significant safety and soundness supervision from its prudential regulator," CUNA President/CEO Jim Nussle wrote Monday.

If this change is enacted, Nussle explained, it would provide meaningful regulatory relief for credit unions, and would allow them to more fully serve their members. Nearly three-quarters of mortgage-originating credit unions retain their mortgages in portfolio, and the mortgages these credit unions originate represents approximately 60% of all credit union first mortgage originations.

Mortgage lending, Nussle noted, is a key service that credit unions provide to their members.

The house is expected to vote on H.R. 1210 Wednesday or Thursday. The measure was approved, with CUNA's strong support, by the house Financial Services Committee in July by a 38-18 vote.


February 21-25, 2016 ● Washington, D.C.

CUNA Governmental Affairs Conference is the largest gathering of credit union advocates rallying on behalf of America’s more than 103 million credit union members.

Join thousands of credit union leaders to leverage the power of our united system and share credit unions’ positive impact with lawmakers from all 50 states.

Click here to register and get more information.

CUNA Advocacy Update

The Regulatory Advocacy Report is now combined with CUNA’s Legislative Update into a comprehensive CUNA Advocacy Update. The new Advocacy Update is published at the beginning of every week, is accessible here and keeps you on top of the most important changes in Washington for credit unions--and what CUNA is doing to monitor, analyze, and influence government agencies and federal law.

Prior CUNA Regulatory Advocacy Reports have been archived and are available here

FREE Webinars on ComplySight, the League's latest compliance resource

Registration is now open for your front row seat to learn about ComplySight, the league's newest addition to your compliance toolbox. If you're looking for a solution to the compliance tidal wave, this system is for you!

(Please register at least 15 minutes prior to the start of the webinar to allow for login information to be sent.)

Introduction to ComplySight

Designed to introduce and show the many features and benefits of ComplySight.

Introduction to ComplySight

December 8 (Tuesday)                   3:30 pm – 4:30 pm (EST)

Introduction to ComplySight

December 17 (Thursday)              11:30 pm – 12:30 pm (EST)

ComplySight Training & Tips

An opportunity to review specific ComplySight topics in detail. Topics change so users can continue to learn additional ComplySight functionality. Come with questions!

ComplySight Training & Tips

December 22 (Tuesday)                 3:30 pm-4:30 pm (EST)

ComplySight Enhancements

Learn about the recent updates and enhancements to ComplySight!

ComplySight Enhancements

November 24 (Tuesday)                 3:30 pm – 4:30 pm (EST)

ComplySight Enhancements

December 29 (Tuesday)                 3:30 pm – 4:30 pm (EST)



Compliance eNEWSLETTER

November 20, 2015
Vol. 9, Issue 46

Created in partnership with the

Credit Union National Association

CU Compliance Connection

CU Compliance Connection provides a number of videos to bring credit unions the latest information on compliance issues they face. 

View the CU Compliance Connection Videos here.

December, 2015 January, 2016 February, 2016
  • February 15th, 2016: Washington's Birthday/President's Day - Federal Holiday
March, 2016
  • March 13th, 2016: Daylight Savings Time Begins
May, 2016
  • May 30th, 2016: Memorial Day - Federal Holiday
June, 2016


CUNA offers hundreds of online training events that make it easy for you to learn right at your desk. Click here for updates on compliance, operations, lending topics and more!

Liquidity and Funding Risk webinar 12/3/2015

Money Mission Demo - Online Financial Literacy Game webinar (12-07-2015)

Forecasting and Strategically Planning for Long-Term Growth webinar 12/10/2015

Managing Credit Risk webinar 12/17/2015

CUNA Regulatory Compliance Introduction eSchool 02/09/2016