NAMU CCUP key terms

A not-for-profit financial cooperative owned by its members and governed by a volunteer board elected from the membership, which returns earnings to members through better rates and services rather than paying outside shareholders.

A person who holds an account and share in a credit union, giving them voting rights, a share of ownership, and eligibility to serve on committees or the board.

The defined group a credit union is legally permitted to serve, such as employees of certain employers, members of an association, or residents of a geographic area, as stated in its charter.

The cooperative principle that each member receives a single vote at the annual meeting regardless of account balance, unlike shareholder voting weighted by shares owned.

Volunteer members elected by the membership who set policy, hire and oversee the chief executive, and carry fiduciary responsibility for the credit union's safety and soundness.

A member committee, often elected, responsible for overseeing internal controls, arranging the annual audit or audit alternative, and verifying member accounts and records.

A member's basic savings deposit at a credit union, representing both a deposit and a required ownership share that establishes membership.

A credit union checking account from which members may write drafts; the credit union equivalent of a bank checking account, often paying dividends on balances.

Interest-like earnings a credit union pays to members on their deposit accounts, declared by the board from net income rather than promised as a fixed rate.

A time deposit at a credit union with a fixed term and stated dividend rate, similar to a bank certificate of deposit, that may carry an early withdrawal penalty.

A Federal Reserve rule that historically limited certain withdrawals and transfers from savings and money market accounts; the six-transfer limit was removed in 2020 but reserve requirements still apply to some institutions.

A negative account balance created when a transaction is paid despite insufficient funds; the credit union may charge a fee and require the member to restore a positive balance.

The condition in which an account lacks available funds to cover a presented item, typically resulting in the item being returned unpaid and a fee being assessed.

The federal rule implementing the Expedited Funds Availability Act, setting maximum hold times on deposits and governing endorsement standards and substitute checks.

The point at which money deposited to an account becomes usable for withdrawals or payments, determined by the credit union's policy within Regulation CC limits.

The portion of an account balance the member can currently access, after subtracting holds, pending transactions, and other restrictions from the ledger balance.

The federal rule implementing the Electronic Fund Transfer Act, covering consumer rights, error resolution duties, and disclosure requirements for electronic transfers.

The required process by which a credit union investigates a member's reported electronic transfer error and responds within Regulation E timeframes, generally ten business days for provisional credit decisions.

Temporary funds a credit union places in a member's account while investigating a disputed electronic transaction, subject to reversal if the claim is not substantiated.

A federal law, implemented by Regulation DD, requiring clear disclosure of deposit account terms, fees, and annual percentage yield so members can compare accounts.

A standardized rate reflecting the total interest or dividends earned on a deposit over one year, including compounding, used to compare deposit accounts.

The primary federal anti-money-laundering statute requiring financial institutions to keep records, file reports such as currency transaction reports, and maintain programs to detect suspicious activity.

The required procedures for verifying the identity of each new account holder using name, address, date of birth, and identification number, plus recordkeeping and comparison against government lists.

A confidential filing to the Financial Crimes Enforcement Network describing transactions the institution suspects involve illegal activity, with a prohibition on telling the customer.

A filing required for currency transactions exceeding ten thousand dollars in a single business day, including multiple related transactions the institution knows about.

Deliberately breaking up cash transactions to stay below reporting thresholds; a federal crime that must be reported when suspected, even if the underlying funds are legitimate.

A warning sign suggesting possible fraud or identity theft, such as a mismatched address, reluctant applicant, or unusual transaction pattern, prompting additional verification.

Fraudulent use of another person's personal information to open accounts, obtain credit, or conduct transactions, triggering specific detection, reporting, and remediation duties.

A social engineering attack using fake messages or calls that impersonate a trusted party to trick a member into revealing credentials, card numbers, or one-time codes.

Fraud in which a criminal gains control of an existing member account, often through stolen credentials, then changes contact details and moves funds.

A federal law, implemented by Regulation B, prohibiting discrimination in credit decisions based on protected characteristics and requiring notices of adverse action.

A written notice to an applicant explaining that credit was denied or altered, stating the specific reasons and the applicant's rights under the Equal Credit Opportunity Act.

A borrower's total monthly debt payments divided by gross monthly income, used by lenders to judge capacity to repay a new loan.

The loan amount divided by the collateral's appraised value, expressing how much of the asset is financed and how much equity cushions the lender.

An asset pledged to secure a loan, which the lender may seize and sell if the borrower defaults, reducing the lender's loss.

The standardized cost of credit expressed as a yearly rate, including certain finance charges, disclosed under the Truth in Lending Act so borrowers can compare loan offers.

A federal law, implemented by Regulation Z, requiring clear disclosure of credit costs and key terms and providing rescission and billing error rights for consumers.

The rule implementing the Truth in Lending Act and parts of the mortgage rules, governing disclosures, advertising, loan originator compensation, and high-cost mortgage requirements.

A federal law governing how consumer credit information is collected, used, and disputed, including duties when taking adverse action based on a credit report.

The obligation to act in the member's or institution's best interest ahead of personal interest, exercising loyalty, care, and candor in handling money and information.

A situation in which a person's private interest could improperly influence their official decisions; it must be disclosed and the person typically recused from the decision.

The duty to protect member information from unauthorized access or disclosure, sharing it only as permitted by law, member consent, or legitimate business need.

The rule implementing the Gramm-Leach-Bliley Act that requires privacy notices, limits sharing of nonpublic personal information, and mandates safeguards for member data.

A written set of conduct standards covering honesty, impartiality, confidentiality, and proper handling of gifts or outside activities that employees and officials must follow.

A person who reports suspected wrongdoing through internal or regulatory channels; federal law and many policies prohibit retaliation against good-faith reports.

The policies, procedures, approvals, and reconciliations designed to prevent errors and fraud, safeguard assets, and keep records reliable.

Dividing tasks so no single person controls an entire transaction from start to finish, reducing the chance that errors or fraud go undetected.

The documented, chronological record of transactions and system activity that lets reviewers reconstruct what happened, who did it, and when.

Unauthorized access to or disclosure of member information that triggers investigation, containment, notification duties, and remediation under applicable law.

Additional scrutiny applied to higher-risk members or transactions, such as extra identity verification, source-of-funds review, and more frequent monitoring.

The process of evaluating a loan application's creditworthiness, capacity, collateral, and terms to decide whether to approve and on what conditions.

Offering additional products or services that genuinely fit a member's needs, done transparently and without pressure or misleading claims.

A consultative approach that identifies a member's financial goals first and recommends suitable products, rather than pushing a predetermined product.

The standard that a recommended product or service fits the member's stated needs, circumstances, and risk tolerance, documented at the time of the recommendation.