NCUA addresses rules on FOM advertising
Sept. 5, 2013 – NCUA instructed federal credit unions on the issue of “overly aggressive marketing campaigns” on Wednesday, specifically reminding them that ads implying “open” membership are misleading and a violation of the Federal Credit Union Act and NCUA requirements.
“Several recent examples of such overly expansive advertising focus on becoming a credit union member by joining a particular association,” states an NCUA Letter to Federal Credit Unions (13-FCU-03). “Mainstream financial publications have picked up on this message, as evidenced by recent articles listing federal credit unions perceived to have ‘open’ membership.”
NCUA emphasized that federal credit unions are legally limited to a field of membership determined by either a single common bond, multiple common bond, or community. The letter said using advertising language such as “anyone can join” could lead to supervisory contact from NCUA or other consequences. These could include removal of an associational group from the credit union’s field of membership or a cease-and-desist order.
NCUA Letter 13-FCU-03