Magazine article American Banker

Banks Lose Utah Bid to Rein in Credit Unions

Magazine article American Banker

Banks Lose Utah Bid to Rein in Credit Unions

Article excerpt

WASHINGTON -- A Utah judge has rejected an effort by bankers in that state to limit the membership base of credit unions to a single county.

The Utah Bankers Association had sued 17 credit unions that serve more than one county, along with a state regulator and a credit union service organization.

On Thursday, District Court Judge Michael R. Murphy granted motions for summary judgements filed by the defendants that argued the association lacked standing to sue.

Not a Matter for Judiciary

"The entirety of this litigation involving differences between credit unions and banks is more appropriately resolved by the executive or legislative branches, not the judiciary," the decision said.

"We're executive vice president of the Utah Credit Union League. "The judge agreed with us across the board."

Michael Crotty, deputy general counsel for litigation for the American Bankers Association, said he assumes the Utah group will appeal the decision.

The Utah Bankers Association has pending in the court of appeals a petition of review of Utah credit unions' shared branching network.

The ABA was provided legal advice to the state association since the lawsuit was filed on August 27, 1993, in the Third Judicial Court of Salt Lake County.

Lawrence Alder, president of the Utah Bankers Association, could not be reached for comment.

The association lacked standing because it could not demonstrate injury to banks due to credit unions serving more than one county. …

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