On March 29, the U.S. District Court for the District of Columbia issued a ruling in the American Bankers Association v. NCUA lawsuit regarding NCUA’s field of membership (FOM) rule. In a mixed decision, the court ruled against the agency on two issues but in its favor on two other issues in dispute.
A Mixed Decision
In October 2016, NCUA issued a final rule to amend its FOM requirements. The final rule was the most comprehensive FOM reform that credit unions have seen in more than a decade. Shortly after its issuance, however, the American Bankers Association (ABA) filed a lawsuit challenging NCUA’s FOM rule.
The ABA sued over four aspects of the rule, arguing that NCUA exceeded its statutory authority and the rule is arbitrary and capricious under the Administrative Procedure Act.
From the July-August 2018 edition of The NAFCU Journal magazine.