THE BANK BRIBERY ACT

Question 1

If NCUA’s Interpretive Ruling and Policy Statement No. 87-1 does not have the force of law, what was NCUA’s purpose in publishing it?

Answer 1

Although these guidelines do not have the force of law, the Justice Department (which prosecutes violations of the BBA) will consider a credit union’s reliance on these guidelines in making the determination whether an activity should or
should not be prosecuted.

Question 2

The NCUA Interpretive Ruling and Policy Statement 87-1 provides credit unions with Bank Bribery Act guidelines. The credit union employees affected by the Act and guidelines are named in that letter. List the six groups named.

Answer 2

The guideline lists: 1) employees; 2) officers; 3) directors; 4) committee members; 5) agents; and 6) attorneys.

Question 3

Why doesn’t IRPS 87-1 establish an objective standard as to how much can be received or given in the areas of business-purpose entertainment or gifts?

Answer 3

IRPS 87-1 does not fix an objective standard as to how much can be received or given in the areas of business purpose entertainment or gifts. NCUA’s official guidance to credit unions is to seek to set the highest ethical standards in their codes of conduct. As the IRPS points out, what is reasonable in one part of the country may appear lavish in another part of the country

Question 4

Are there ever any circumstances when a credit union official can accept something of value over the credit union’s established guidelines?

Answer 4

The NCUA guidelines state that a credit union official may accept something of value in connection with credit union business if the credit union makes the
approval in writing based on a full written disclosure of the relevant fact and if the acceptance does not violate the Bank Bribery statute.

Question 5

List three types of “things of value” a credit union’s Bank Bribery Act Policy can allow a credit union official to receive without violating the BBA.

Answer 5

Any of the following:
- Gifts, gratuities, or favors based on an obvious family or personal relationship where the circumstances make it clear that it is those relationships – not the business of the credit union – which provide the motivating factor.
- Meals, refreshments, or entertainment, all of reasonable value and occurring in the course of a legitimate business meeting provided these expenses would be paid for by the credit union if they were not paid for by the other party (the credit union can, and should, establish a specific dollar limit for such an occasion).
-Loans from banks or financial institutions on customary terms to finance proper and usual activities of credit union officials such as home mortgage loans except where prohibited by law.
- Advertising or promotional material of nominal value such as pens, pencils, note pads, key chains, calendars, and similar items.
-Discounts or rebates on merchandise or services that do not exceed those available to other members.
-Gifts of reasonable value that are related to commonly recognized occasions
such as a promotion, new job, wedding, retirement, Christmas, or bar or bat mitzvah (the credit union can, and should, establish a specific dollar limit for
these types of gifts).
-Civic, charitable, educational, or religious organizational awards for recognition
of service and accomplishment (the credit union can, and should, establish a specific dollar limit for these types of awards).

Question 6

The NCUA guidelines discuss conflict of interest for credit union officials. What does it say the credit union official must do when a conflict of interest situation arises?

Answer 6

The NCUA guidelines recommend that the credit union’s code of conduct require all credit union officials to disclose all potential conflicts of interest including any they are inadvertently placed in due to business or personal relationships with members, suppliers, business associates, or competitors of the credit union.