DOJ: NCUA Board Members Can Be Removed At Will
By CU Today Staff —
WASHINGTON—The Justice Department is urging a federal appeals court to reverse the judgment that reinstated former NCUA board members Todd Harper and Tanya Otsuka, arguing Congress placed no restrictions on the president’s authority to remove NCUA board members and that the agency does not share the special status the Supreme Court has recognized for the Federal Reserve.
In a reply brief filed Sept. 18 with the U.S. Court of Appeals for the D.C. Circuit, the Justice Department said Congress “placed no statutory limits on the President’s ability to remove members of the National Credit Union Administration Board,” meaning the president can remove them at will. The government said that while Congress expressly provided statutory removal protections for Federal Reserve governors, it did not do so for NCUA board members.
The Justice Department devoted a separate section of the brief to what it called a central flaw in Harper and Otsuka’s case: “The NCUA Is Not The Federal Reserve.” DOJ said the Supreme Court’s decision in Trump v. Cook recognized the Fed as a “uniquely structured, quasi-private entity” with a special historical status tracing to the First and Second Banks of the United States. That exception, DOJ argued, does not extend to all federal financial regulators, including the NCUA.
As CUToday.info previously reported, Harper and Otsuka have argued the Supreme Court’s June decisions in Trump v. Slaughter and Trump v. Cook support their challenge. They contend NCUA is more analogous to the Federal Reserve because of its role as a financial regulator, deposit insurer and provider of emergency liquidity. The D.C. Circuit sought additional briefing following the Supreme Court decisions, with the Administration maintaining that Slaughter supports its position and Harper and Otsuka arguing Cook applies more directly to NCUA.
The dispute stems from President Trump’s April 2025 removal of Harper and Otsuka from the three-member NCUA board. U.S. District Judge Amir H. Ali subsequently ruled the removals unlawful and ordered the two reinstated. The D.C. Circuit later stayed that judgment while the Administration pursued its appeal, keeping Harper and Otsuka off the board during the litigation.
DOJ is now asking the appeals court to overturn Ali’s judgment. The government argues that because Congress did not restrict the president’s removal authority—and because any implied restriction would be unconstitutional—the district court “plainly erred in ordering plaintiffs’ reinstatement to office.” The brief concludes simply: “The Court should reverse the judgment.”
The litigation comes as the NCUA board’s composition has changed following the confirmation of John Crews as chairman.
Originally reported by CU Today.