Mr. Barry F. Mardock
May 21, 2014
June 2 2014
Mr. Barry F. Mardock
Office of Regulatory Policy
Farm Credit Administration
1501 Farm Credit Drive
McLean, VA 22102-5090
Dear Mr. Mardock:
Thank you for the opportunity to comment on FCA's recent proposed rule regarding Standards of Conduct. Adherence to appropriate Standards of Conduct is important to the integrity of the Farm Credit System and a topic which should be carefully considered. The FCA’s proposed rule, however, does far more harm than good and should be substantially revised.
As a director of CoBank, I find that the disclosure requirements in the Conflicts of Interest section of the proposed rule to be entirely inappropriate and completely unrealistic. The proposed rule ignores the System’s cooperative structure and the way I do business in my own farming and Ranching operation. I routinely have business transactions with a wide variety of individuals, some of whom might be CoBank or an affiliated association’s customers. For the most part, I don’t know whether someone I’m doing business with is a System borrower. Even in instances where I know I’m dealing with a customer, there is no conflict of interest since directors at CoBank do not have any role in approving loans or the terms of loans.
Requiring me to disclose any transaction with a customer, even when I know I am doing business with a customer, is not realistic. The number of transactions I have in the normal course of my business means that both CoBank and I would spend an enormous amount of time shuffling paperwork with absolutely no impact on any conflict of interest. Perhaps most importantly, the proposal will immediately discourage qualified individuals from serving on the board of their FCS association.
Some examples on my operation are: I routinely buy feed from other farmers. They are all arms length transactions and in many cases I have no idea if they are a system borrower or not. I possibly deal with hundreds of vendors each year and sell my products and services to hundreds more.
I urge the FCA to revise the proposed rule substantially prior to issuing a final rule. I would also like to offer my support for the comments submitted by CoBank and the Farm Credit Council. Thank you for your consideration.
Robert W. Bray