Emmer legislation aims to modernize federal credit union practices

Bipartisan legislation offered on April 1 by U.S. Rep. Tom Emmer (R-MN) would update federal credit union practices and improve employee and member safety.

“Our community financial institutions are already facing difficulties navigating burdensome regulations as they support their local neighborhoods and businesses, and we need to take steps to make their vital work easier,” Rep. Emmer said last week. “This non-partisan legislation will ensure our Main Street credit unions have the tools to succeed.”

The Credit Union Governance Modernization Act of 2021, H.R. 2311, which Rep. Emmer sponsored with original cosponsor U.S. Rep. Ed Perlmutter (D-CO), would amend the Federal Credit Union Act to modernize certain processes regarding expulsion of credit union members for cause, according to the congressional record bill summary, and would ensure a fair procedure for reinstatement.

Rep. Emmer’s office noted that current law requires a federal credit union to hold a vote of its entire membership before expelling a member who engages in egregious, dangerous or illegal conduct. 

If enacted, H.R. 2311 would broaden the ability for them to expel members for cause, allowing federal credit unions to remove members due to flagrant actions, including damage to property, harassment or threats, according to a bill summary provided by Rep. Emmer’s office.

“My home state of Minnesota has already taken steps to adopt a similar, important measure,” said Rep. Emmer. “It’s critical we make credit unions safer for both employees and their members.”

The National Association of Federally-Insured Credit Unions (NAFCU), the Credit Union National Association, the Minnesota Credit Union Network, and the Mountain West Credit Union Association support H.R. 2311.

“As our credit unions and their employees help our communities and businesses recover from COVID-19, this commonsense solution to securing their safety and security should be a top priority,” Rep. Emmer said.