Title: Credit Union Governance Modernization Act of 2020
Policy area: Finance and Financial Sector

Summary:
Credit Union Governance Modernization Act of 2020
This bill revises the procedure for expelling members from a federal credit union. Specifically, a member may be expelled for cause pursuant to a policy adopted by a majority vote of a quorum of the directors of a credit union. Currently, a member may be expelled by a two-thirds vote of the credit union membership present at a special meeting.
The expelled member may request reinstatement by the credit union board.
Member conduct that may be cause for expulsion includes

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 3323 Introduced in Senate (IS)]

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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 Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Credit Union Governance 
Modernization Act of 2020''.

SEC. 2. EXPULSION OF FEDERAL CREDIT UNION MEMBERS FOR CAUSE.

    Section 118(a) of the Federal Credit Union Act (12 U.S.C. 1764(a)) 
is amended--
            (1) by striking ``Except'' and inserting ``(1) Except'';
            (2) by striking ``by a two-thirds vote of the members of a 
        Federal credit union present at a special meeting called for 
        the purpose, but only after opportunity has been given him to 
        be heard'' and inserting ``for cause pursuant to a policy 
        adopted by a majority vote of a quorum of the directors of the 
        Federal credit union and provided in written or electronic form 
        to all members of the Federal credit union''; and
            (3) by adding at the end the following:
    ``(2)(A) Any member expelled pursuant to this paragraph shall--
            ``(i) be provided with written or electronic notice of the 
        reason for the expulsion; and
            ``(ii) be given an opportunity to request reinstatement of 
        membership and have the request considered at a meeting of the 
        board of directors, in a timely manner after the expulsion.
    ``(B) Nothing in this paragraph may be construed to require a board 
of directors to allow an expelled member to address the board in person 
or attend the meeting described in subparagraph (A)(ii) in person.
    ``(3) In this subsection, the term `cause' includes--
            ``(A) a loss to the Federal credit union;
            ``(B) a violation of the membership agreement of the 
        Federal credit union;
            ``(C) a disruption to the operations of a Federal credit 
        union; and
            ``(D) fraud, attempted fraud, other illegal behavior or 
        inappropriate behavior, as defined by the policy described in 
        paragraph (1), such as physical or verbal abuse of Federal 
        credit union members or staff.''.
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