Compliance Blog

Oct 15, 2010
Categories: Board and Governance

Advertisements in Periodic Statements?

Posted by Anthony Demangone

Can a federal credit union place advertisements in their periodic statement?  You bet they can.   You can do it pursuant to your incidental power of "finder activity." 

Finder activities are among the preapproved incidental powers of FCUs. 12 C.F.R. §721.3(f). Under NCUA’s incidental powers rule, an FCU may act as a finder and introduce or bring together its members with third party vendors so the two parties may negotiate and consummate transactions. Finder activities involve providing information to members about the products or services of third parties and include providing advertising space on an FCU’s web site, on ATM receipts, and in a newsletter, or including marketing materials in the mailing of account statements and newsletters.

Now, here's one issue that NCUA didn't address in this letter.  Can you gain income through the use of your "finder activities" incidental power? You bet you can. 

Keep in mind that NCUA raises a good point.  You always want to protect your reputation when deciding whether to run advertisements in your newsletters or periodic statements.