July 18, 2002



Jonathan G. Katz, Secretary
Securities and Exchange Commission
450 5th Street, N.W.
Washington, D.C. 20549-0609

Re: File Number: S-7-12-01 (Application Of Evangelical Christian Credit Union)
Credit Union Exemption From Broker-Dealer Requirements In Regard To Sweep Accounts

Dear Mr. Katz:

The Ohio Credit Union League appreciates the opportunity to file comments on the Security and Exchange Commission's ("SEC") Notice of Application of Evangelical Christian Credit Union from exemptive relief from the broker-dealer requirements with regard to Sweep Accounts. The Ohio Credit Union League ("OCUL") is the trade association for credit unions in the State of Ohio representing approximately 500 credit unions, both federal and state chartered.

Credit unions are member-owned non-profit cooperative financial institutions governed by unpaid volunteers that predominately engage and provide various financial services to their members. Moreover, as financial institutions, credit unions are subject to numerous regulatory requirements. Federally chartered credit unions are regulated by the National Credit Union Administration ("NCUA") and the Ohio Division of Financial Institutions ("ODFI") regulates state chartered credit unions.

In considering the issue of exemption, OCUL respectfully requests that the SEC consider the following recommendations:

Furthermore, the issue of defining and registering as a broker-dealer as well as addressing the broker-dealer exceptions from registration for banks has been well established. Under the 1934 Act, entities acting as "brokers" or "dealers" must register with the SEC and join a self-regulatory organization (SRO). "Brokers" are defined as entities engaged in the business of effecting transactions in securities for the account of others, and "dealers" are defined as entities that buy and sell securities for their own account.

Until the GLB Act was enacted in 1999, banks were not covered under the broker-dealer definitions and were not required to register with the SEC. The GLB Act removed this exemption and replaced it with a number of functional exceptions for certain bank securities activities.

The SEC issued interim final rules last year that were intended to clarify these functional exceptions. Although not required under the GLB Act, these exceptions will also apply to thrifts, but not to credit unions. Prior to the GLB Act, credit unions and thrifts were not covered under the exemption that was provided for banks.

In response to the interim final rule, OCUL filed comments supporting the exclusion of credit unions in the respective exemptions listed for bank securities activities that were also applied to thrifts.

As stated above, credit unions are non-profit financial institutions organized as cooperatives under federal or state law. More importantly, like all financial institutions, credit unions operate under a regulatory formula that is similar to that of the other financial institutions, i.e., banks and thrifts. Under this regulatory formula, credit unions are subject to examinations, prompt corrective action, and regulatory reporting requirements.

Furthermore, credit unions, as financial institutions, should be treated and enjoy the same rights, powers, authority, and privileges extended to other types of financial institutions. Additionally, since credit unions are subject to a similar regulatory formula and examination structure as banks and thrifts, they should therefore have the same opportunities and flexibility to offer products and services to their members as banks and thrifts offer to their customers.

Consequently, the Ohio Credit Union League respectfully requests that the Securities and Exchange Commission first, grant approval for the Evangelical Christian Credit Union's request for an exemption from the broker-dealer requirements to offer sweep accounts; second, extension of this exemption to all credit unions, whether federally or privately insured under the same authority as applied to banks and thrifts; and third, consider extending to credit unions the other exemptions that the banks and thrifts will receive under the interim final rules.

Finally, OCUL is concerned that by not extending the exceptions that banks and thrifts currently have to credit unions, credit unions must still continue to rely on opinions issued by the SEC and/or NCUA that permit credit unions to offer security products without registering as a broker-dealer, or depend on a contractual arrangement in which a registered broker-dealer provides services under certain conditions. Consequently, credit unions, as non-profit cooperative financial institutions, must depend on a process that, at times, can be cumbersome and potentially limiting to a credit union's ability to engage in these activities.

Therefore, OCUL respectfully requests that the SEC consider the inclusion of credit unions in extending the exceptions to the broker-dealer requirements as full-service financial institutions regulated by the respective federal and/or state agencies. More importantly, inclusion of credit unions would also be consistent with the Ohio state legislators' extension of specific exceptions to the broker-dealer definition pursuant to state security laws, to banks, thrifts, and credit unions as evidenced by legislation that has been signed into law.

The above represents the comments of the Ohio Credit Union League. OCUL appreciates the opportunity to comment on the issue of allowing credit unions to offer sweep accounts without registering as a broker-dealer. Furthermore, OCUL would also be willing to provide additional comments, if requested.

If you have any questions, comments or if I can be of further assistance please do not hesitate to contact me.


John F. Kozlowski, General Counsel
Ohio Credit Union System

cc: Kathleen Kanipe
Paul L. Mercer
OCUL Advocacy Committee
Mary Dunn
Jeffrey Bloch