Compliance

Exam Problems? Know Your Rights

CU Bill of Rights is based on the NCUA Examiner’s Guide.

January 19, 2011
KEYWORDS credit , examiner , unions
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Twenty-four examination rights

According to “Supervisory Issues and Examinations: Guidance for Credit Unions During the Current Economic Times and Beyond,” credit unions have the right to:

  1. Manage risk without being directed by examiners to eliminate it.
  2. Receive respectful conduct from their examiner.
  3. Be examined by well-trained, competent examiners who understand credit unions’ unique characteristics.
  4. Meet and discuss examiner findings, conclusions, directives, and administrative actions with the examiner.
  5. Question and seek corrections to examiner findings, conclusions, and directives.
  6. Provide alternative and/or additional data, conclusions, and solutions to address problems identified by the examiner.
  7. Know the specific authority or legal basis for an examiner’s directive.
  8. Receive clearly written examination reports, notices, etc., on a timely basis.
  9. Receive exam reports, findings, directives, and administrative actions that are based on all relevant facts.
  10. Be evaluated on their own strengths and weaknesses, not solely on the basis of regulator concerns about trends.
  11. Be evaluated for progress toward objectives that are realistic and achievable, and proportionate to the risk presented.
  12. Receive examination findings and directives that are risk prioritized.
  13. Appeal examiner findings, conclusions, or directives without retaliation from their regulator.
  14. Have instructions, detailed on every exam report form, about how to appeal examiner decisions.
  15. Record meetings with examiners and other agency personnel.
  16. Have a representative, such as an attorney, present during meetings with the examiner and other regulatory personnel.
  17. Have any published orders—such as consent orders—address only facts and not conjecture or speculation by the examiner.
  18. Have confidential, non-discoverable communications with their legal counsel regarding examination issues.
  19. Develop and use “high-level” policies, which should be separate and distinct from detailed procedures.
  20. Have a lead examiner that is state or federal, consistent with the credit union’s charter type.
  21. Know the timing of when NCUA will publish a Letter of Understanding and Agreement.
  22. Defer to their CPA if there is a disagreement between the officials and their regulator regarding issues related to U.S. generally accepted accounting principles.
  23. Have communication (i.e., discussion of draft findings) with their examiner prior to final issuance of the examination report.
  24. Have directives from examiners (including verbal and written comments) be consistent with regulatory requirements, policies, and Letters to Credit Unions. For example, there were inconsistencies noted between how examiners treated the assessment’s effect on credit union earnings and an NCUA letter to credit unions on the subject.

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