The power of regulators to bar individuals from serving in acredit union once they have left their former employer has come infor new focus this week with a Pennsylvania appellate court barringthe ex-CEO of the $119 million Boeing Helicopters CU from rejoininga CU.
|The Commonwealth Court of Pennsylvania in Harrisburg inupholding a 2009 order by the Department of Banking regarding JohnGalante, who had been terminated by Boeing, held that theenforcement power of regulators would be hindered by overturningthe order.
|Galante in a series of court challenges over the years contendedthe department lacked jurisdiction to ban him from future jobssince he had left the Ridley Park, Pa., credit union in January2009.
|The court opinion, written by Judge P. Kevin Brobson argued that“there can be no question” the state agency has jurisdiction todetermine whether people should be prohibited from working in CUsafter they have exited from their positions.
|“If the regulator does not have authority over ex-credit unionemployees, then all a CEO has to do to avoid sanction is to resignright before the regulator's action,” said the court.
|A spokeswoman for NCUA declined comment on the ruling since itis “dealing largely with a state action,”
|The current president/CEO of Boeing Helicopters CU, Philip Travaglini, also declined comment.
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