WASHINGTON–Credit unions are pushing back on a letter the banking industry has been circulating on Capitol Hill that asks is seeking members of Congress to call on Treasury to require federal credit unions to disclose more information around their operations, including compensation.
The letter, which was first reported by the CU Daily, is marked as a “draft” and unsigned.
The letter urges Treasury Secretary Scott Bessent and Treasury to “reconsider” the regulatory exemption that permits Federal credit unions to forgo the disclosure and transparency requirements outlined in Section 6033 of the Internal Revenue Code, which mandates that most tax-exempt organizations must file an annual information return with the Internal Revenue Service (IRS), typically a Form 990, Return of Organization Exempt from Income Tax, or a variation like Form 990-EZ or Form 990-PF.
Change Made in the 1970s
It requires organizations to report detailed financial data and information on their operations, governance, and compensation of key personnel to ensure transparency and compliance with tax laws. In 1971, a change to the Treasury Regulations under Section 6033 exempted federal credit unions from this disclosure.”
“We believe that enhancing transparency for larger federal credit unions would serve the public interest and align with the principles that already apply to state-chartered credit unions and other tax-exempt organizations,” the letter reads.
Jason Stverak, chief advocacy officer with the Defense Credit Union Council, said the letter is being circulated “under the guise that credit unions do not provide enough transparency.”
Goal is to Create ‘Obstacles’
He said DCUC has pointed out in a letter it has sent in response and in other forums that credit unions are already providing a “tremendous amount of information, more than what would go on a 990, to NCUA and this is nothing more than any attempt by the banks and their allies in Congress to go after credit unions and create more regulatory burdens and hardships…so that we have more obstacles in front of us in serving our members.
“We are going to very vocally oppose this issue because all credit unions, but especially our smaller credit unions, should not be spending more time filling out forms that do nothing other than hinder their ability to provide incredible services for their members,” he added.
