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 Did the Trump Firings Cause a Regulatory Crisis at the NCUA? Warren & Waters Demand Answers

Episode Overview

Mark Treichel breaks down the congressional response to President Trump's firing of NCUA Board members Todd Harper and Tanya Otsuka, examining letters from Senators Elizabeth Warren and Maxine Waters that question the agency's legal authority to operate with only one board member.

Key Topics Covered

The Firings and Immediate Aftermath

• April 16, 2025: Trump fires NCUA Board members Todd Harper and Tanya Otsuka
• Only Chairman Kyle Hauptman remains on the three-member board
• Questions arise about the agency's ability to function without a quorum

Congressional Response

• Elizabeth Warren & Maxine Waters demand answers about NCUA's operations
• Letters sent to both the NCUA Inspector General and Board Chairman Hauptman
• Focus on whether single-member board can legally conduct agency business

The "Essential Functions" Controversy

• NCUA relies on delegation authority allowing "essential functions" during emergencies
• Problem: No clear definition of what constitutes "essential"
• Historical context from early 2000s when similar situation occurred with Dennis Dollar

Actions Taken Under Question

The IG identified 11 Board Action Memorandums (BAMs) approved by Hauptman alone:

1. Semi-annual agenda establishment
2. Board appeal hearing approval
3. Schedule policy career petition
4. Deferred resignation program approval
5. SSP performance standards changes
6. NCA delegation revisions
7. Examination schedule policy revision
8. Share insurance rule simplification comments
9. Personnel appointments and reassignments
10. Acting Inspector General appointment
11. Board meeting transcript approval
12. Bonus controversial action: Credit union conservatorship

Legal and Political Implications

• Regulatory crisis: Agency's own regulations require two board members for action
• Political undertones: Warren designed single-director CFPB but opposes single-member NCUA
• Pending lawsuits: Harper and Otsuka challenging their firings in court
• Potential solutions: Trump could appoint new members or court could rule on legality

Expert Analysis

Mark Treichel provides insider perspective as former NCUA Deputy Executive Director who helped create the "essential functions" delegation in the early 2000s.

Key Questions Raised

• What constitutes an "essential function" of the NCUA Board?
• Can the agency issue regulations with only one board member?
• Are the actions taken since April 16th legally defensible?
• Will pending court cases resolve the authority questions?

Timeline to Watch

• July 7th: Deadline for Hauptman's response to congressional demands
• Ongoing: Court cases challenging the firings
• Future: Potential new board member appointments