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Dive Deposits: The NCUA is not the Fed, DOJ says

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Dive Deposits: The NCUA is not the Fed, DOJ says

An appeals court should reverse the reinstatement of two fired NCUA board members because the law doesn’t explicitly forbid the president from ousting them, the Justice Department argued.

The Justice Department on Friday accused two fired members of the National Credit Union Administration board of “scouring legislative history, statutes no longer in effect, and the zeitgeist of the 1970s” to persuade a district court to reinstate them.

In urging the D.C. Circuit Court of Appeals to reverse that reinstatement, the DOJ reached much further back than the 1970s, quoting James Madison, Alexander Hamilton – and a Supreme Court case from 1903.

“‘In the absence of [a] constitutional or statutory provision’ explicitly to the contrary, the longstanding constitutional rule is that ‘the President can, by virtue of his general power of appointment, remove an officer, even though appointed by and with the advice and consent of the Senate,’” the DOJ argued Friday, quoting the turn-of-the-20th-century case Shurtleff v. U.S. “When ‘no statute restricts removal,’ ‘there can be no doubt’ that the President as the appointing authority may remove NCUA Board Members ‘at will.’”

President Donald Trump in April 2025 fired Todd Harper and Tanya Otsuka, two Democrats serving on the NCUA board. But Harper and Otsuka sued Trump, arguing their ouster left the board with just one member, which didn’t qualify as a quorum.

A district judge reinstated them in July of that year. But since then, the eyes of the legal community have been trained on the Supreme Court’s rulings on Trump’s attempts to fire Federal Trade Commission members (allowed) and a Federal Reserve governor (denied) .


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