OAK HARBOR, Ohio-Commodore Perry FCU has appealed its latest examination results to NCUA, alleging that numerous findings are not just inaccurate and false, but a result of examiner retaliation.
The appeal now sits with NCUA's Supervisory Review Committee.
President Thomas Renz said he is concerned over the track record of CUs utilizing NCUA's appeals process. "To my knowledge, four credit unions have made it to the Supervisory Review Committee in the last decade only to have their appeals turned down," said Renz. "We also hope that it becomes clear to NCUA that their appeals process is not working well."
NCUA said from January 2002 to June 2012, 48 CUs filed appeals with their regional offices, with 13 obtaining favorable rulings. Four of the appeals reached NCUA's Supervisory Review Committe, and none obtained a favorable ruling.
What has the $33-million CPFCU upset are examination findings it alleges are "very erroneous," said Renz. "There are some facts and findings in the exam that are clearly not true. They are either the result of gross negligence or retaliation by our examiner."
Renz said what lead to the allegation of retaliation is the fact that the CU complained about the examiner's conduct to his supervisor. The CU alleges that during the course of its past two examinations, CPFCU staff were subjected to "harassment and bully tactics" by the examiner. "We let the examiner's supervisor know about the issue, told her we did not want to file a formal complaint, and just wanted the examiner taken off our current review. But to her credit, she had to report the matter."
Renz said the NCUA Office of Inspector General is now investigating the examiner conduct allegations, and the examiner has been transferred. As for NCUA,"We cannot comment on any aspect of any pending action in regards to an examination," said spokesperson John Fairbanks
'A Boilerplate Letter'
Renz said that the examiner was allowed to complete the latest review, despite requests for removal before the latest exam was finished. Renz said the examiner was aware of the complaint before completing the recent review.
"We first appealed to the regional office in Atlanta," explained Renz. "However, we were never contacted to discuss our case nor were we given an opportunity to present evidence. Instead, we simply received a boilerplate letter stating our appeal had been rejected. We then appealed to the SRC."
Renz contends that the detailed, 300-plus page appeal that now rests with the SRC contains clear evidence to support the credit union's allegations that many of the exam findings are incomplete and false statements.
At issue here, too, claims Renz, is that despite the OIG's recent report that NCUA's appeals process is adequate, he believes it may be broken. The CU shared its own struggles with the NCUA exam process in a letter to Ohio's two senators, the Senate Banking Committee, and NCUA.
Renz emphasized the appeal is not finished, that the CU hopes to work with NCUA on the matter, and "remains hopeful the SRC will make a just ruling." But Renz added, "No one wants to get in a fight with NCUA. They have all their rules against examiner retaliation. Still, retaliation is what you are afraid of-and a fight between David and Goliath. But we are sure about what we are doing. If this does not work out through the NCUA appeals process, we will take it to the NCUA board. If that does not work out, we will take it to court."