The House of Representatives passed legislation last week that allows credit unions to expand their memberships, effectively invalidating a Supreme Court ruling last month that prevented the financial institutions from appealing to a broad clientele.
The legislation could quell concerns that the National Institutes of Health Federal Credit Union no longer will be able to accept GW students and employees as members.
In response to the Court’s ruling, the Credit Union Membership Access Act will amend the 1934 Federal Credit Union Act, which permitted credit unions to draw only members that share a common bond.
Credit unions have seen rapid growth since the early 1980s, when they began to accept groups of employees from several different companies, said Representative Steven LaTourette (R-Ohio), who sponsored the new bill.
The Supreme Court ruling could have endangered the memberships of 13,000 GW-affiliated members of the NIH FCU. Across the nation, it could have affected 70 million members in 3,500 other credit unions, said Jennifer Stonesifer, marketing manager for the NIH FCU.
“Long term, the Supreme Court ruling would have hindered the rates of membership and number of accounts opened at the GW branch,” Stonesifer said.
The NIH FCU has served GW since 1992. It currently caters to 56 different employer groups. The House legislation will allow students continued access to the credit union.
“I don’t think that the courts have the right to dictate to Americans where they can or cannot conduct their financial business,” LaTourette said in statement on his Web site.
Stonesifer said the credit union encouraged its GW members to write letters to Congress to support the bill and prevent continued limits on credit union memberships.
The language of the new bill will allow credit unions to expand membership to any group affiliated with the parent company, said LaTourette. For example, since the National Institutes of Health are affiliated with GW Hospital, members of the University community can become members of the NIH credit union.
The bill was co-sponsored by more than 160 congressmen, including Speaker of the House Newt Gingrich (R-Ga.). It received 411 votes.
Stonesifer said the vote demonstrated overwhelming Congressional support of credit unions despite the Supreme Court ruling. She said the legislation sends a powerful message to banks, which originally brought the case to court, asserting that credit unions had overstepped their boundaries.
A Senate vote on the issue is expected by the end of the month.
Stonesifer said she expects the Senate vote to be favorable to credit unions.