NCUA Approves Proposed Rule on Federal Credit Union Succession Planning

The National Credit Union Administration (NCUA) approved a proposed rule which would require Federal Credit Union (FCU) boards of directors to establish and adhere to processes for succession planning.

Specifically, an FCU board of directors must establish a process to ensure proper succession planning to include officers of the board, management officials, executive committee members, supervisory committee members, and (where provided for in the bylaws) the members of the credit committee.

The board is responsible for:

  • Approval of a written succession plan that covers the officers of the board, management officials, executive committee members, supervisory committee members, and members of the credit committee if provided for in the bylaws; and
  • Review, and update as deemed necessary, the succession plan and policy in accordance with a schedule established by the board of directors, but no less than annually.

The succession plan must, at a minimum, identify key positions covered by the plan, necessary general competencies and skills for those positions, and strategies to identify alternatives to fill vacancies.

Question of the Week

Q. What are the record retention guidelines for the bank secrecy act (BSA)?

A. In accordance with 31 CFR 1010.430, all records required under Chapter X—FINANCIAL CRIMES ENFORCEMENT NETWORK, DEPARTMENT OF THE TREASURY must be retained for five years. Specifically, the §1010.430 states:

(a) Wherever it is required that there be retained either the original or a copy or reproduction of a check, draft, monetary instrument, investment security, or other similar instrument, there shall be retained a copy of both front and back of each such instrument or document, except that no copy need be retained of the back of any instrument or document which is entirely blank, or which contains only standardized printed information, a copy of which is on file.

(b) Records required by this chapter to be retained by financial institutions may be those made in the ordinary course of business by a financial institution. If no record is made in the ordinary course of business of any transaction with respect to which records are required to be retained by this chapter, then such a record shall be prepared in writing by the financial institution.

(c) The rules and regulations issued by the Internal Revenue Service under 26 U.S.C. 6109 determine what constitutes a taxpayer identification number and whose number shall be obtained in the case of an account maintained by one or more persons.

(d) All records that are required to be retained by this chapter shall be retained for a period of five years. [emphasis added] Records or reports required to be kept pursuant to an order issued under §1010.370 of this chapter shall be retained for the period of time specified in such order, not to exceed five years. All such records shall be filed or stored in such a way as to be accessible within a reasonable period of time, taking into consideration the nature of the record, and the amount of time expired since the record was made.

Related Link

31 CFR §1010.430

Compliance Alerts

Financial Crimes Enforcement Network

FinCEN Statement Regarding Beneficial Ownership Information Reporting and Next Steps: FinCEN released a statement on the notice of proposed rulemaking (NPRM) regarding the reporting of beneficial ownership information that closed for comments on Dec. 8, 2021. FinCEN appreciates the comments and stated that the next step will be an NPRM regarding access to the database that the information will be stored in.

Office of Foreign Assets Control

OFAC has updated the SDN list as of Feb. 10. The last update prior to this was Feb. 3.

­­­­­­­­­­­­­­­­­­Questions? Contact the Compliance Hotline: 1.800.546.4465; compliance@nwcua.org.

Posted in Compliance News, Compliance News, Compliance Question.