Credit Union Regulatory Alert  

Published by Howard & Howard Attorneys PLLC

Compliance Deadline Approaching for CUSO Rule

On November 21, 2013, the National Credit Union Administration (NCUA) finalized new requirements for federally-insured credit unions that invest in or lend to credit union service organizations (CUSOs). While the rule predominately impacts CUSOs, credit unions do have their own requirements. 


Mandatory Compliance Date

Credit unions that have invested in or lent to CUSOs must amend their agreements by June 30, 2014. A credit union must enter into a separate written agreement with each CUSO it has invested in or lent to. After June 30, 2014, any credit union loan to or investment in a new CUSO relationship must include these contractual provisions. 


Scope & Applicability

The requirement to enter into written agreements with CUSOs applies to all federally-insured credit unions. The final rule extends specific accounting and auditing requirements to federally-insured state-chartered credit unions. Previously, these requirements applied only to federal credit unions. 


Contractual Provisions

The CUSO rule strengthens NCUA's ability to oversee credit unions' relationships with CUSOs. As part of this oversight, credit unions must enter into formal, written agreements that require their CUSOs to report information to NCUA and any applicable state supervisory authority. Additionally, the agreement needs to outline specific accounting and auditing requirements the CUSO must follow. 


Additional Information

Credit unions needing additional information and answers to frequently asked questions should download Howard & Howard's Regulatory Update on the Final CUSO Rule

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Compliance Deadline Approaching for CUSO Rule
About Howard & Howard

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 concentrates his practice in the area of financial regulations. His intimate knowledge of the operational issues facing credit unions provides the perfect platform to recommend best practices to reduce compliance, strategic and reputation risks.
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  is a Member of Howard & Howard Attorneys PLLC and concentrates his practice in credit union mergers and acquisitions, loan documentation review and strategic planning.
This Advisory is intended for informational purposes only, and is not offered as legal advice.  Please call a qualified attorney for counsel related to your particular situation.