Credit Union Governance Modernization Act of 2020

II 116TH CONGRESS 2D SESSION S. 3323 To amend the Federal Credit Union Act to modernize certain processes regarding expulsion of credit union members for cause, and for other purposes. IN THE SENATE OF THE UNITED STATES FEBRUARY 24, 2020 Ms. SMITH (for herself and Mr. SASSE) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To amend the Federal Credit Union Act to modernize certain processes regarding expulsion of credit union members for cause, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Credit Union Govern- 4 ance Modernization Act of 2020’’. 5 SEC. 2. EXPULSION OF FEDERAL CREDIT UNION MEMBERS 6 FOR CAUSE. 7 Section 118(a) of the Federal Credit Union Act (12 8 U.S.C. 1764(a)) is amended— 9 VerDate Sep 11 2014 23:10 Feb 24, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S3323.IS S3323 kjohnson on DSK79L0C42PROD with BILLS 2 •S 3323 IS (1) by striking ‘‘Except’’ and inserting ‘‘(1) Ex- 1 cept’’; 2 (2) by striking ‘‘by a two-thirds vote of the 3 members of a Federal credit union present at a spe- 4 cial meeting called for the purpose, but only after 5 opportunity has been given him to be heard’’ and in- 6 serting ‘‘for cause pursuant to a policy adopted by 7 a majority vote of a quorum of the directors of the 8 Federal credit union and provided in written or elec- 9 tronic form to all members of the Federal credit 10 union’’; and 11 (3) by adding at the end the following: 12 ‘‘(2)(A) Any member expelled pursuant to this para- 13 graph shall— 14 ‘‘(i) be provided with written or electronic no- 15 tice of the reason for the expulsion; and 16 ‘‘(ii) be given an opportunity to request rein- 17 statement of membership and have the request con- 18 sidered at a meeting of the board of directors, in a 19 timely manner after the expulsion. 20 ‘‘(B) Nothing in this paragraph may be construed to 21 require a board of directors to allow an expelled member 22 to address the board in person or attend the meeting de- 23 scribed in subparagraph (A)(ii) in person. 24 ‘‘(3) In this subsection, the term ‘cause’ includes— 25 VerDate Sep 11 2014 23:10 Feb 24, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S3323.IS S3323 kjohnson on DSK79L0C42PROD with BILLS 3 •S 3323 IS ‘‘(A) a loss to the Federal credit union; 1 ‘‘(B) a violation of the membership agreement 2 of the Federal credit union; 3 ‘‘(C) a disruption to the operations of a Federal 4 credit union; and 5 ‘‘(D) fraud, attempted fraud, other illegal be- 6 havior or inappropriate behavior, as defined by the 7 policy described in paragraph (1), such as physical 8 or verbal abuse of Federal credit union members or 9 staff.’’. 10 Æ VerDate Sep 11 2014 23:10 Feb 24, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6301 E:\BILLS\S3323.IS S3323 kjohnson on DSK79L0C42PROD with BILLS