SAN DIEGO— Accusing large credit unions of performing financial “magic tricks” that hide their true impact on communities, the Independent Community Bankers of America has launched a new national advocacy campaign dubbed “The Illusionists,” aimed at exposing what the group claims are misleading narratives used by credit unions to justify their tax exemption and rapid growth.
Unveiled during the group’s annual ICBA LIVE 2026 conference here, the campaign frames large credit unions as institutions that portray themselves as community focused while quietly expanding through acquisitions and operating with what ICBA describes as unfair tax and regulatory advantages.
The effort includes a dedicated website, a video, messaging tools for bankers and a coordinated advocacy push intended to elevate the issue in local communities and with policymakers.
“It's time to pull back the curtain on credit union behavior,” the campaign website states. “Big credit unions have perfected their act: while presenting themselves as community champions, they quietly make accountability, tax fairness and consumer choice disappear.”
A New National Push
According to ICBA, the campaign is intended to help community bankers raise concerns locally about credit unions’ growing size and their increasing acquisitions of tax-paying banks.
The website highlights several statistics used by ICBA to support its claims, including that credit union acquisitions of banks have accelerated sharply over the past decade.
ICBA data cited by the campaign say the number of deals has nearly tripled, rising from roughly five per year in the 2010s to 14 per year in the 2020s, and reaching a record 22 transactions in 2024.
The group argues those deals remove tax-paying banks from local communities and replace them with institutions that do not pay federal income tax.
Screen grab from ICBA video.
The campaign also claims credit unions are increasingly absent from economically distressed areas, asserting that less than 10% of credit unions are located in distressed communities and only about 13% operate in low- and moderate-income areas combined.
ICBA argues those trends undermine the rationale for the credit-union tax exemption, which was originally granted to support not-for-profit cooperatives serving underserved populations.
Mobilizing Bankers
A central element of the campaign is a “community banker playbook” designed to help banks elevate the issue locally.
Through the website, bankers can request a package of advocacy tools that includes:
- Ready-to-use messaging and talking points
- Sample social media posts
- A customizable letter-to-the-editor template
- Guidance for engaging local policymakers and media
The goal, according to ICBA, is to help bankers highlight what it calls “tax fairness” issues and the impact of credit-union acquisitions on communities.
The group also said its materials provide information comparing the performance of community banks and credit unions in serving local communities.
A Long-Running Fight
The campaign is the latest escalation in a long-running political battle between the banking industry and credit unions.
ICBA and other banking trade groups have repeatedly argued that large credit unions have outgrown their original mission and should lose their federal tax exemption once they reach a certain asset size.
Banking groups have also sharply criticized the growing number of credit-union purchases of community banks, arguing the deals remove tax-paying institutions from local markets and reduce government revenue.
Credit union advocates counter that the acquisitions often preserve local banking services that might otherwise disappear and that credit unions continue to operate as member-owned cooperatives focused on consumers rather than shareholders.
DCUC Responds
The Defense Credit Union Council said the latest ICBA campaign is less about facts and more about “desperation.”
“Let’s be honest about what this really is: a well-funded attempt by the banking lobby to distract policymakers from its own preferential tax treatment while attacking the cooperative financial institutions that millions of Americans trust,” said DCUC Chief Advocacy Officer Jason Stverak. “ICBA’s campaign is built on a series of tired talking points and outright contradictions.
Jason Stverak
“First, community banks complaining about tax policy is a bit rich when thousands of them operate under Subchapter S status, allowing owners to avoid corporate taxes entirely and pass income directly through to shareholders,” continued Stverak. “Yet the same institutions benefiting from that tax advantage now claim the moral high ground when it comes to credit unions’ tax status. That’s not principled policy advocacy—it’s hypocrisy.
“Second, ICBA continues to repeat the myth that credit unions are ‘tax-subsidized competitors.’ Credit unions are not-for-profit financial cooperatives owned by their members, not outside investors. The tax status Congress granted credit unions recognizes that fundamental difference. Every dollar earned by a credit union is returned to members through lower loan rates, higher savings yields, and fewer fees not distributed to shareholders or Wall Street investors.
Stverak added that the ICBA’s campaign “deliberately ignores” the reason credit unions exist in the first place: to serve people banks historically overlooked.
“Military families, rural communities, and working Americans depend on credit unions precisely because their cooperative model prioritizes people over quarterly earnings. ICBA’s argument boils down to this: if a not-for-profit cooperative succeeds in serving its members well, it should be punished for it,” Stverak said.
Stverak said the banking lobby’s sudden concern about competition rings hollow.
“Banks dominate the financial services marketplace with trillions in assets, access to capital markets, and again tax structures like Subchapter S designed to minimize tax liability. Meanwhile, credit unions remain mission-driven cooperatives whose earnings go back to members, not shareholders,” he said. “So, when ICBA talks about ‘deceptions,’ policymakers should ask a simple question: who benefits from rewriting the rules?”
ACU Comments
Scott Simpson
America’s Credit Unions President and CEO Scott Simpson called the ICBA effort "another haphazard misinformation campaign attacking credit unions, but the facts remain unchanged: credit unions are member-owned, not-for-profit financial cooperatives that exist to serve their communities and expand access to affordable financial services.
“If the goal is to spotlight deceptions, it may be worth starting with the illusion that credit unions operate like Wall Street banks," said Simpson. "They do not. More than 145 million Americans choose credit unions because they put people ahead of profits and reinvest earnings back into better rates, lower fees, and financial education for their members. And they choose credit unions not because of illusions, but because of the miracles they make happen every day for their members. Whether that’s helping a small business owner realize their dreams or a young family with their first home purchase, credit unions stand firmly by their members’ side day-in-and-day-out."
Simpson continued, stating, “While some groups continue to push misleading narratives about the cooperative finance model, we remain focused on the real issue of ensuring families, small businesses, and underserved communities have access to safe, affordable financial services. Credit unions and community banks both play important roles in the financial ecosystem. America’s Credit Unions will continue advocating for policies that strengthen community-based financial institutions and the consumers they serve.”