Can we bring transparency to CU governance?

I’ve been used to the idea that all credit union data is available to the general public, thanks to the Freedom of Information Act, ever since I discovered the existence of the complete financial data for all of the approximately eight thousand federally-insured credit unions in the United States back in the year 2000.

This is a wonderful thing. This means that ANYONE, a member, a concerned citizen, a person looking to join a credit union, a vendor looking to sell his/her services, can instantly get a picture of any credit union’s financial condition. This is important to democracy, and is compatible with the democratic principles that this nation, as well as the credit union movement, are founded on.

But what I am shocked to discover is that the “higher” levels of the credit union system are not run with this type of transparency. And am thinking about two current examples.

Lack of transparency from the NCUA: On Will Magnus’ amazing tell-all blog, he reprints the Letter of Understanding that the NCUA is requiring Corporate Credit Unions to sign in order to get/renew share insurance. I don’t pretend to fully understand the ramifications of the agreement, but I was saddened to learn that the agreement included a clause to keep the contents of the agreement itself a secret because to make it public, would be “contrary to the public interest.” Excuse me? Who decided that one? I am appalled. I can’t figure out what information it contains that someone did not want to be public knowledge. Thank you, Will Magnus, for giving us the transparency that the NCUA does not want us to have.

Equally, if not more, galling is that CUNA has not so far not published the results of their survey asking credit unions if they are for or against trying to obtain TARP-money. Christian Mullins has done an excellent analysis of this TARP-survey, concluding that CUNA is trying to sway CUs toward pursuing TARP money. If CUNA operated in the open, honest and transparent manner that the Obama administration is embracing, they would publish the results of the survey for all to see and analyze. However, they’ve also given little thought to the method of their survey. It’s an open and random web survey (now closed) that anyone could fill out. This is rife with potential for abuse. There is no way to verify that anyone responding to the survey is really from the credit union they say they are from. People can vote multiple times and stuff the ballot box. And what if more than one person from a CU responds? What if the CEO votes one way, and the board votes another way? What if the MSRs are split? What if management pressures staff to vote a certain way? What if some CUs encourage their staff to vote, and other CUs remain ignorant that the survey exists? This poll was poorly designed and executed. The results, no matter how they come out, are tainted and unscientific. Now, where did CUNA publish those results again?

Tags: CUNA, FOIA, NCUA, NCUA Corporate Stabilization Program, polls, surveys, TARP