The remaining Board members refused to seat Heller due to the NCUA’s order. Thereafter, Heller filed suit against the Credit Union and the NCUA demanding that he be permitted to serve as a duly elected Board member.

The NCUA, pursuant to its own mandate, requires all federal Credit Unions to maintain fidelity bonds covering Credit Union Board members. Heller sought to have the NCUA’s cease and desist order voided.

The court held that Heller did not have standing to sue the NCUA, as only the Credit Union itself could bring an action to set aside an NCUA cease and desist order. The action against the Credit Union was dismissed as well since this federal court ruled that it could no longer entertain the “state” claim against the Credit Union. The court ruled against the Board member on both matters. John Heller v. CACL Federal Credit Union & the NCUA (U.S. Dist. Court, E.D. Penn., No.91-2870).

Author: Charles R. Harroun, Attorney at Law