The Brookings Institution, a Washington DC think tank, has announced the following event this Thursday:
“Credit union regulation at a crossroads: A conversation with former NCUA Board Member Todd M. Harper.”
Event Details:
Date: Thursday, May 1, 2025
Time: 11:00 a.m. – 12:00 p.m. EDT
Location: The Brookings Institution, Saul Auditorium, 1775 Massachusetts Ave. NW, Washington, D.C. 20036
This is the link to the online broadcast.
Two NCUA Board Members File Suit to Regain their Positions
On Monday, as reported in CU Today, Otsuka and Harper filed suit in federal court to regain their NCUA board seats.
The full 12-page suit can be found here. One paragraph is especially important right now. This is a statement about the quorum needed to conduct Board business. It reads:
- The President’s removal of Mr. Harper and Ms. Otsuka has left the NCUA Board without a quorum, rendering it unable to implement Congress’s mandate in full. Only one Board Member, Defendant Kyle S. Hauptman, remains as both the agency’s sole Board Member and its Chairman.
But the Federal Credit Union Act vests the powers of the agency in “the Board,” not in any one individual, with a quorum requiring a majority of the Board. 12 U.S.C. § 1752a(d). And the “agreement of at least two of the three Board members is required for any action by the Board.” 12 C.F.R. § 791.2.
With only a single Member purporting to exercise authority, the NCUA cannot Case 1:25-cv-01294 Document 1 Filed 04/28/25 Page 7 of 12 7 continue carrying out the supervisory, regulatory, and institutional functions that Congress intended to be exercised by a Board composed of at least a majority of its Members.
Despite some agency and other comments, the lawyers assert that a single board member is not a legal quorum to conduct board meetings or other official business.
Questions for Harper’s Conversation at Brookings
The lawsuit is clear in its arguments that Trump’s actions are unlawful. But it will take time to see how this legal process plays out, and lots can happen in the meantime.
Here are several areas I hope Harper will address in this week’s public conversation:
- Circumstances at NCUA prior to the removals. The action was just prior to a scheduled board meeting in which the downsizing was on the agenda. What was the proposed action? Was there consensus among the board? What internal work did DOGE representatives do? Why are Hauptman and Fasio included in the suit? What was their role in this action? Did you ask NCUA legal staff for their position or to challenge this action? What is your current understanding of the state of the agency’s staffing-how many are leaving and what critical areas do you see uncovered?
- In addition to following the lawsuit and Brookings conversation, what other public actions might credit unions or their representatives undertake to support this lawsuit? Amicus briefs? How are your legal expenses being covered?
- Your role as Chairman at NCUA. Several significant trends emerged during your NCUA tenure in the cooperative system. Two major ones were the accelerating pace of credit union whole bank purchases for cash. The second was mergers of strong, long serving and increasingly large credit unions in which the departing CEO’s and staffs gained significant personal compensation for setting up the merger. In one case the CEO and Chair transferred $12 million in member equity to their personal control. You did not address these topics while on the board. What is your position on events like this?
- Your position on potential future regulatory changes. During your tenure as an NCUA board member you frequently cited the FDIC model to recommend multiple changes in the legislation governing the NCUSIF, the cooperative credit union insurance fund. Would you support merging the NCUSIF and FDIC if that were to be proposed? A second issue is potential federal taxation of credit unions in some format. What is your position on such an initiative?
Finally, how might credit unions and the public get in touch with your and Otsuka now that your official emails and contacts have ended?
I intend is to attend the event in person this Thursday.