Washington, D.C. (July 1, 2026) — With a major embezzlement scandal at a tax-exempt credit union continuing to generate headlines, the Independent Community Bankers of America (ICBA) today is renewing its call for the federal government to require federal credit unions to file Form 990s like nearly all other tax-exempt organizations, which could have helped expose in a timely fashion the alleged fraud conducted at Jackson [Miss.] Area Federal Credit Union.
“The sensational and deeply troubling news of a major embezzlement scheme at a credit union that enjoys taxpayer subsidies and regulatory advantages over tax-paying community banks demands a response from policymakers,” ICBA President and CEO Rebeca Romero Rainey said. “ICBA has long warned of the dangers of allowing tax-exempt credit unions to operate with lax oversight and limited transparency, which has only helped to facilitate the growth of this subsidized sector of the financial system at the expense of locally based community banks. Enough is enough—it is past time for policymakers to take action to rein in credit union mission creep and market overreach.”
As reported by national and local media outlets, the former president and CEO of the tax-exempt credit union in Jackson, Miss., allegedly embezzled an estimated $95 million from the institution before the National Credit Union Administration placed it into conservatorship for unsafe and unsound practices. The head of the now-defunct taxpayer-subsidized institution allegedly used the funds to finance a lavish lifestyle, including high-end cars, jewelry, and a custom “purse room” to display a collection of designer handbags.
ICBA recently told the Treasury Department that federal credit unions should be required to file Form 990, the annual information return required of nearly all tax-exempt organizations. Responding to Treasury’s Form 990 Transparency Initiative and in line with ICBA’s repeated calls for Congress to require federal credit unions to file 990s, ICBA:
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Urged Treasury and the IRS to revisit the longstanding exemption that permits federal credit unions to avoid filing Form 990.
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Said the Form 990 promotes transparency and public accountability by placing detailed financial and governance information in the hands of credit union members, policymakers, and the general public.
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Cited the importance of furnishing the IRS with the data necessary to verify that tax-exempt status is warranted and is being honored.
The renewed attention to transparency at tax-exempt credit unions follows a recent data analysis from ICBA showing that credit union acquisitions of tax-paying community banks are harming small businesses and local communities while community banks outperform credit unions in high-poverty areas—the founding credit union role that Congress used to justify the industry’s tax-exempt status. Further, ICBA polling of U.S. adults shows that Americans support reforming credit union policies, with 60% of Republicans and 59% of Democrats saying Congress should end the federal tax exemption for credit unions with more than $1 billion in assets.
ICBA’s The Illusionists campaign—which appears on streaming, digital, and print platforms—highlights how large credit unions grow through these acquisitions and regulatory advantages. The campaign website—creditunionsrevealed.com—features data, videos, frequently asked questions, and research highlighting the policy disparities that allow tax-exempt institutions to expand while competing directly with tax-paying community banks.
ICBA looks forward to continuing to work with the administration and the 119th Congress to advance policy reforms that address the lack of transparency and tax and regulatory parity at tax-exempt credit unions.
About ICBA
The Independent Community Bankers of America® has one mission: to create and promote an environment where community banks flourish. We power the potential of the nation’s community banks through effective advocacy, education, and innovation.
As local and trusted sources of credit, America’s community banks leverage their relationship-based business model and innovative offerings to channel deposits into the neighborhoods they serve, creating jobs, fostering economic prosperity, and fueling their customers’ financial goals and dreams. For more information, visit ICBA’s website at icba.org.