Compliance Blog

Oldie But a Goodie – Which Hats Cannot Be Worn Together

Written by Elizabeth M. Young LaBerge, Senior Regulatory Compliance Counsel, NAFCU

Credit union volunteers and staff sometimes wear a lot of hats at once. A question the NAFCU Compliance Team gets frequently is whether someone in a particular role is disqualified from serving in another role concurrently. Internal controls are a supervisory focus for NCUA this year, so we thought it might be a good time to remind credit unions about a helpful tool located in Appendix 4A of the NCUA Examiner Guide.

Conflicting Management Positions

The below chart is attached to the NCUA Examiner Guide's chapter on internal controls. It sets out a list of seventeen staff and volunteer positions at a credit union, and then lists other positions that cannot be held concurrently with that position, either because it's prohibited by law, regulation, or bylaw.

It then ALSO indicates what other positions aren't explicitly prohibited by law, but shouldn't be held by someone in that position by virtue of sound internal controls. For your referential enjoyment, NCUA's Conflicting Positions table:

Position

Prohibited by Law,

Regulation, or Bylaw

Prohibited by Principles of Sound Internal Control

Chief Executive Officer (CEO)

Vice President

Secretary

Assistant Secretary

Treasurer

Assistant Treasurer

Manager

Assistant Manager

Membership Officer (if the President countersigns checks)

Member of the Supervisory Committee

Supervisory Committee Assistant

Credit Union Employee

Assistant Executive Officer

President

Secretary

Assistant Secretary

Treasurer

Assistant Treasurer

Manager

Assistant Manager

Membership Officer (if the Vice-President countersigns checks)

Member of the Supervisory Committee

Supervisory Committee Assistant

Credit Union Employee

Recording Officer (Secretary)

President

Vice President

Manager

Assistant Manager

Member of the Supervisory Committee

Supervisory Committee Assistant

Credit Union Employee

Assistant Secretary

President

Vice President

Treasurer

 

Financial Officer (Treasurer)

President

Vice President

Member of the Supervisory Committee

Supervisory Committee Assistant

Membership Officer

Assistant Secretary

Member of the Credit Committee

Assistant Treasurer

President

Vice President

Membership Officer

Member of the Supervisory Committee

Supervisory Committee Assistant

Director

Manager

Assistant Manager

(Only one director may also be a member of the Supervisory Committee)

Credit Union Employee

Executive Committee Member

Any officer or employee other than a director (Only directors may serve as Executive Committee Members)

Member of the Supervisory Committee

Member of the Credit Committee

Credit Union Employee

Membership Officer

Supervisory Committee Member

Member of the Credit Committee

Credit Union Employee

Treasurer

(Only one board member may also serve on this committee.)

Loan Officer

Membership Officer

Assistant Treasurer

President

Vice President

Secretary

Credit Committee Member

Member of the Supervisory Committee

Supervisory Committee Assistant

(Only one credit committee member may be appointed a loan officer.)

Treasurer

Manager

Loan Officer

Membership Officer

(Only one Credit Committee member may be appointed a loan officer.)

Member of the Supervisory Committee

Supervisory Committee Assistant

Membership Officer

Treasurer

Assistant Treasurer

Loan Officer

Manager

Assistant Manager

President or Vice-President if checks are countersigned

Member of the Supervisory Committee

Supervisory Committee Assistant

Manager

Member of the Board of Directors except by bylaw provision

President

Vice President

Member of the Supervisory Committee

Supervisory Committee Assistant

Membership Officer

Relative of any official

Member of the Credit Committee

Assistant Manager

Member of the Board of Directors

Member of the Supervisory Committee
Supervisory Committee Assistant

Membership Officer

Relative of any official

Supervisory Committee Assistant

Treasurer

Assistant Treasurer

Manager

Assistant Manager

Member of the Credit Committee

Credit union Employee

Loan Officer

Membership Officer

Relative of any official or Employee

Assistant Treasurer

President

Vice-President

Secretary

Credit Union Employee

Member of the Supervisory Committee

Supervisory Committee Assistant

Relative of any official

Member of the board of directors

 

About the Author

Elizabeth M. Young LaBerge, NCCO, NCRM, CIPP/US, Senior Regulatory Counsel, NAFCU

Elizabeth M. Young LaBerge, NCCO, NCRM, CIPP/US, Senior Regulatory Compliance CounselElizabeth M. Young LaBerge, NCCO, NCRM, CIPP/US,  joined NAFCU as regulatory compliance counsel in July 2015 and was named Senior Regulatory Compliance Counsel in July 2016.

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