America’s Credit Unions’ Amanda Smith wrote to the NCUA on its proposed rule to enact the Fair Hiring in Banking Act (FHBA). The bill, passed as a part of the fiscal year 2023 National Defense Authorization Act, would replace a lifetime ban for those with disqualifying convictions to work in the banking sector and create an exception for criminal acts committed before the age of 21.
Smith expressed the association’s support for the rule in the letter, noting that “credit unions embody the second chance philosophy and serve a number of populations that may be disenfranchised or unbanked.” Smith noted that the NCUA had worked to address hiring issues prior but added that the FHBA extends greater relief to certain individuals.
However, she noted that credit unions “indicate that the reluctance to hire candidates with criminal records may be more strongly influenced by both the need to gain consent from the NCUA Board and the potential bondability of the candidate than concerns regarding the criminal offense.” Smith requested that the agency consider removing some of the stricter requirements for background information, as they may be difficult to obtain.
Smith concluded by calling on the NCUA to closely monitor how the bill might impact underwriting for fidelity bonds and the potential changes of “the affordability of employment for credit unions, especially smaller institutions.”