The Supreme Court will not hear ABA’s FOM’s appeal and will void the case

US Supreme Court. (Credit: Two Bridges Photography/Shutterstock)

On Monday, the US Supreme Court dismissed an appeal by the American Bankers Association to review the NCUA’s Field of Membership (FOM) rules.

This decision of the Supreme Court ends a nearly four-year legal battle by the ABA versus the NCUA.

On Monday afternoon, NCUA Chairman Rodney Hood released the following statement: “Today’s Supreme Court decision ends nearly four years of uncertainty and will assist the NCUA in its efforts to promote greater financial inclusion for all Americans. The NCUA will immediately begin processing membership applications affected by this decision.”

Shortly after the Supreme Court decision, CUNA, NAFCU, and CUNA Mutual Group issued a joint announcement stating that the groups “have long supported the rule and authority of the NCUA to oversee the credit union industry.”

“Today is a great day for all those hoping for the financial prosperity that credit unions provide,” said CUNA President/CEO Jim Nussle. In dismissing the bankers’ lawsuit, the court explained the mission and structure of the credit unions as part of the American fabric. By recognizing the NCUA’s right to monitor our system, the court has also put in place a much-needed firewall against false banker attacks. CUNA looks forward to working with the NCUA and credit unions to find new ways to extend financial services for people through profit to communities across the country and thanks the court for today’s decision.”

“The Supreme Court’s decision not to hear the banker’s case is an indication that the case is, and always has been, unfounded,” said NAFCU President/CEO Dan Berger. “For years, banking lobbyists have worked tirelessly to maximize their own profits by working to undermine the growth of the credit union and the financial well-being of America’s communities and small businesses. NAFCU stands firmly behind the NCUA’s membership rule. It is within the legal powers of the agency and works for the benefit of consumers, particularly those who are underserved.”

“This is fantastic and we congratulate the Supreme Court on correctly dismissing the bankers’ appeal,” said Robert N. Trunzo, President/CEO of CUNA Mutual Group. “This is a huge win for credit unions and consumers at what may be the most difficult time our nation and the world has faced. As we continue to navigate this extraordinarily difficult time, the court’s decision will ensure people continue to have access to essential credit union services as they seek to build a better financial future.”

In March 2018, Judge Dabney Friedrich of the U.S. District Court for the District of Columbia reversed portions of a rule the NCUA issued in 2016. These sections automatically qualified a Combined Statistical Area, or a contiguous portion thereof, to be a local community with fewer than 2.5 million people and raise the population limit for counties to one million people.

However, a three-judge panel of the US Circuit Court of Appeals for the District of Columbia overturned large portions of that decision, ruling that large portions of the FOM rule complied with federal law.

That ABA then asked the High Court to review that decisionand claims the rules give credit unions an unfair advantage.

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