Administrative Actions Separate from PCA As discussed in Section I, NCUA may take ―administrative actions‖ that are separate from PCA supervisory actions. These separate measures are among the most serious supervisory steps NCUA may take against a credit union or its officials as addressed in Chapter 30 of the NCUA Examiner’s Guide, these actions include: Letters of Understanding and Agreement; Cease and desist orders; Civil money penalties; Removal of officials; Termination of insurance; Conservatorship; Revocation of charter; and Liquidation. According to NCUA’s Examiner’s Guide, before taking an administrative action, the examiner should try to resolve the problems with the credit union’s officials informally. ―Often, a realistic Document of Resolution and frequent examiner contacts will resolve problems with no need for administrative action.‖19 Also, before taking administrative action, the examiner and the supervisory examiner must clearly understand the problems with the credit union and why previous steps to address the problems have failed. The administrative record ―must present a complete, factual, and fully documented history of the credit union’s problems and the attempts by NCUA and the credit union to resolve them.‖20 To initiate an administrative action, the examiner will recommend an action, and the NCUA regional office will consult with NCUA’s central office before implementing it. Once an action is determined, the examiner generally delivers the notice (or order) to the credit union, informing officials there of the violations or problems and what action is required of the credit union to address those issues. Refusal of the credit union to accept the notice does not mean it will not be enforced. Credit Unions May Challenge Administrative Actions Credit unions have the right to challenge a number of administrative actions. The appeals process may vary depending on the administrative action involved. It is important to note that there are only limited appeals associated with Letter of Understanding and Agreement (LUAs). LUAs as well as DoRs are essentially contracts with the agency and therefore credit 19 20
NEG page 30-2. NEG page 30-3.
Credit Union National Association
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