Summary: Part 746 -- Appeals

Prepared by the NASCUS Legislative and Regulatory Affairs Department
November 2017

NCUA has promulgated a new final rule to establish procedures to govern appeals to the NCUA Board. The rule establishes a uniform procedure that will apply to agency regulations that currently have their own embedded appeals provisions.

The Appeals final rule may be read here. The rule became effective January 1, 2018

Summary

Part 746 subpart B Appeals process applies to the following NCUA rules:

  • § 701.14 Change in official or senior executive officer in credit unions that are newly chartered or are in troubled condition
  • § 701.21 Loans to members and lines of credit to members
  • § 701.22 Loan participations
  • § 701.23 Purchase, sale, and pledge of eligible obligations
  • § 701.32 Payment on shares by public units and nonmembers
  • § 701.34 Designation of low income status; Acceptance of secondary capital accounts by low-income designated credit unions
  • Chartering applications
  • Merger, FOM expansion and spinoff requests
  • Underserved area request
  • Requests to convert to state or federal charter
  • Requests for expanded investment authority (FCUs)
  • § 705 requests for loans or technical assistance grants
  • § 709 certain claims in liquidation
  • § 741 – NCUA revocation of approval of foreign branch
  • §750.6 Golden parachutes

Part 746 Subpart B, Appeals Procedure

Upon receiving an adverse determination on a qualifying issue from NCUA, the credit union or credit union professional has 30 days to request a reconsideration from the issuing NCUA program office. The request for reconsideration, which must be in writing, should contain:

  • A statement of the facts on which the request for reconsideration is based
  • A statement of the basis for the initial agency determination to which the petitioner objects and the alleged error in such determination
  • Any other support or evidence relied upon by the petitioner which was not previously provided to the appropriate program office.

The program office will review its decision, taking into consideration the existing facts and any new information provided in the written request for reconsideration. The program office has 30 days to render a decision. The decision will be in writing and will state the reasons for the decision. The burden of “proof” for reconsideration lies with the credit union/petitioner seeking the review by the program office.

If the program stands by the initial decision, or if the credit union/petitioner demurs on seeking the program office reconsideration, then the credit union petitioner may seek an appeal to the NCUA Board. The written appeal to the NCUA Board

Any appeal filed with the Board must include:

  • A statement of the underlying facts of the appeal
  • Copies of all pertinent documents, records, and materials that support the appeal
  • Petitioner statement outlining why the petitioner objects to the initial agency determination and identifying any alleged errors made by the program office
  • Any other materials or evidence relied upon by the petitioner that were not provided to the appropriate program office

The burden of proof in an appeal to the NCUA Board rests with the petitioner. A petitioner has 45 days from submission of an appeal to submit amendments to the appeal or additional information.

At the time petitioner requests an appeal, the petitioner may request an oral hearing before the NCUA Board. Should petitioner seek an oral hearing, that request must be submitted in writing at the same time as request for appeal, but in a separate document. Decision to grant an oral hearing is the discretion of the Board.

Once the appeal is received by the NCUA Board, it will be reviewed by an attorney from general Counsel’s office designated as the “Special Counsel” to determine whether conformance with the rules governing appeals. The Special Counsel will also contact the Program Office to request copies of all relevant materials and conduct a review of those materials as well as the petitioner’s materials in order to make a recommendation to the NCUA Board.

The Board will render its decision within 90 days of the original receipt of the request for appeal from petitioner.

The new rule does not apply to:

  • Formal enforcement actions
  • Creditor claims in liquidation
  • Material supervisory determinations within the jurisdiction of the SRC
  • Challenges to actions imposed under PCA
  • Appeals of matters that are delegated by rule to an officer/position below the Board for final, binding agency action

NCUA will consider including information on Appeals in its Annual Report. In the meantime, NCUA will continue to publish information regarding Appeals on the NCUA website.

NCUA will provide copies of all Appeal related correspondence to SSAs.