Rep. Tenney Asking For Ways And Means Committee Hearing On ‘Disparities’ Between CUs And Banks (CUToday, October 29, 2024)

NEW YORK—Rep. Claudia Tenney (R-NY) is calling for a House Ways and Means Committee hearing on the “inequities” between credit unions and banks, and is zeroing in on the CU tax exemption.

Tenny made the statement during the American Bankers Association’s Annual Convention in New York this week.

Tenney suggested having a discussion with experts before the Committee to “illustrate” the disparities.

The Defense Credit Union Council (DCUC) responded with a letter to Tenney about her comments.

“We appreciate your willingness to engage in discussion around the tax-exempt status and regulatory framework of credit unions, including Community Reinvestment Act (CRA) requirements,” wrote DCUC Chef Advocacy Officer Jason Stverak. “As these topics are of significant interest, we welcome the opportunity to provide additional insight and to address any questions you may have.

“Credit unions, particularly those serving military and defense communities, are unique not-for-profit financial cooperatives. Our mission is member-focused, prioritizing the financial readiness and stability of the service members, veterans, and families we serve,” continued Stverak. “This focus differs fundamentally from the shareholder-driven objectives of for-profit institutions, aligning with our tax-exempt status. By reinvesting any earnings back into our members and community services rather than into dividends or profits, we uphold a structure specifically designed to benefit our members—many of whom sacrifice greatly in service to our nation.”

Stverak pointed out the regulatory differences between banks and credit unions are based on the “distinct missions and operational models of these two sectors. While banks are subject to CRA requirements as part of their mandate to serve entire communities equitably, credit unions operate with field-of-membership constraints, inherently focusing on serving targeted, often underserved, populations.”

Stverak told CUToday.info that when a member of the Ways and Means Committee makes comments regarding inequities between banks and credit unions “our ears perk up because we want to make sure that any misconceptions that Representative Tenney, or any member of Congress, has on these issues are addressed right away.”

DCUC President and CEO Anthony Hernandez told CUToday.info “these kinds of developments need taken very seriously. We need to tell the credit union story so that we can protect our industry from banker attacks.”