Your credit union may manage various legal matters today, from reviewing and developing contracts to ensuring the organization is up to compliance standards. Perhaps you have some internal staff who fulfill these roles or consult with an outside attorney, but is there an appropriate time to establish an in-house team? On “C.U. On the Show,” Doug welcomes guest attorney Kendra Rubin, chief legal officer at SEFCU, a New York-based credit union. They discuss her journey joining the credit union movement, how she built SEFCU’s legal department from scratch, and the value an internal attorney can add to a credit union—and it’s not just about managing regulatory and litigation issues.

When to Hire In-House Counsel

Outside counsel and a few internal staff members may be able to manage everyday legal matters a credit union may face, such as contracts and compliance. However, there comes a point when securing in-house counsel makes strategic and financial sense, according to Kendra. For example:

  • If your credit union exceeds $4 billion in assets or is growing rapidly
  • If the organization is experiencing more regulatory scrutiny
  • If your credit union wants to get more involved in legislative advocacy
  • If litigation concerns arise more frequently

For any of these reasons, it could benefit a credit union to bring in someone new to view situations from a different perspective. This unique lens, as Kendra states, can be beneficial in not only legal matters but from a strategic and business standpoint too. It’s valuable to have someone on board who can see where the organization is going, help steer away from risk, avoid panic, and provide executive and board input.

The Benefits of In-House Counsel

The primary benefit of in-house counsel is that they are engaged in the everyday business of the credit union and can proactively manage critical areas, identify trends, and anticipate the credit union’s needs more efficiently than a third party. An internal attorney can also help manage outside counsel spending and streamline more legal matters in-house, which could develop into further cost savings over time. Kendra acknowledges hiring in-house counsel is a significant financial concern for credit unions, especially smaller organizations. However, as Kendra puts it, you can’t put a long-term dollar amount on avoiding the expense of litigation and compliance risks due to unidentified or unresolved legal issues.

Stream the full episode to learn more about:

  • Kendra’s process for developing a legal team from scratch and the first steps she recommends credit unions should take when they get started
  • The typical legal concerns Kendra’s team manages in-house and when it’s beneficial to partner with outside counsel
  • How Kendra, her executive colleagues, and the credit union board created a mutually beneficial business partnership

Hear the conversation on when and how to get started, whether you’re a smaller credit union considering legal assistance or a larger institution looking to expand.

Stream the episode here.

Kendra Rubin and SEFCU are not affiliated with or endorsed by ACT Advisors, LLC.

Audio Transcription (pulled from the podcast)

Doug  (0:00)

My guest on today’s podcast is Kendra Rubin. Kendra is chief legal officer at SEFCU, where she provides legal advice and strategy to senior management, manages external legal counsel relationships, and oversees contract administration, regulatory compliance, and advocacy. In this episode, we discuss in-house legal counsel, including its strategic role, implementation, and when your credit union should consider it.

So, Kendra, welcome to the show. I’m delighted that you are here today. Tell me how did you get started working with credit unions?

Kendra  (0:41)  

First of all, Doug, thank you so much for having me on the show. I’m extremely excited to be here after a couple of scheduling conflicts. And I’m excited to finally make it. So how I got started in credit unions was just a few years ago. I’m not a lifer in the movement by any means. I came to credit unions by way of state government, where I spent many years serving in the New York State Executive Chamber in a variety of roles, as a lawyer and as a counselor and advisor. From there, I was introduced to the New York Credit Union Association once I was ready to get out of state government. And I interviewed to be their Vice President of Government Affairs, which is essentially a lobbyist. Having my background in state government—understanding the legislative process, how a bill moves through the process, the state senate, the state assembly, the executive chamber, understanding that intricate wheel of state government—was really helpful to me as I moved into lobbying. So I understood government, I understood how legislation worked, and credit unions as the subject were new to me. And I started there and absolutely loved it, fell in love with the movement, fell in love with the mission of credit unions in particular, and haven’t looked back since then. So it’s been an exciting couple of years.

Doug (2:06) 

Tell me what it is you’re doing these days.

Kendra  (2:09)   

So these days, actually today, Doug, is my second-year anniversary. Yeah, with SEFCU, which is a credit union in upstate New York, and I am their in-house counsel, which I have been doing now for two years exactly, which is very exciting. 

Doug (2:26)   

And is it correct to say that prior to two years ago SEFCU did not have an in-house legal department? 

Kendra (2:34)   

That’s correct. So not only am I coming into the role, but I’ve also built over the past two years an actual legal department and sort of framed out what an in-house counsel should be to a credit union and developed that with my internal clients. Working on that for the past two years has been really exciting. It’s been a lot of work. It’s been a lot of learning; I’m learning something every day. We’re now, as you know, going through a merger, which has been a whole new level of education for me, which is really, really exciting. And I’m really excited about the years to come. But I am the first in-house counsel here. And it’s been a fantastic ride so far. And I’m looking forward to continuing it.

Doug (3:13)   

Great. Well, on this podcast, what I’m hoping to capture is your learnings from that journey and I want to have you try to step us back to even before SEFCU hired you and brought you in. Can you speak to what caused the credit union to recognize it was time to create an in-house counsel position? And then just give us some learnings, your best ideas for how you would do it if you were to think about it again. And of course, talk to our listeners about who should look at that as a step they should consider.

Kendra (3:48) 

Yes, absolutely. So our board and our CEO are always looking at what’s next. And they’re very forward-looking. And sort of ahead of their time, I think, as a board and as a CEO. So they had been wanting to bring on an in-house counsel for a while. And I got to know some of the board members and also the CEO of SEFCU through my work at the association. So I had been working with them in a different capacity, essentially as a lobbyist for a couple of years, and got to know the staff at SEFCU, the CEO, some of the board members, and they were just really excited about the credit union movement. And they thought it was growing to a size, and I think we were about four and a half billion at that point, grown to a size where it might make sense to bring in in-house counsel to start managing the legal affairs of the credit union. And it’s something that before coming to SEFCU I had sort of assumed was like any other sector, right? Where you have your legal department, you have your lawyers in-house, you work with outside counsel. And that was an assumption I had made that credit unions were sort of similar to banks; all the big banks have their legal departments, they have their structure set up, their in-house counsel, that’s very common. Credit unions, it turns out, not so much, right? And the bigger credit unions have started to bring on in-house counsel, started to develop significant level legal departments. But the smaller credit unions haven’t and SEFCU was growing to the point where they recognized the value of bringing on in-house counsel. And so that’s how I came to SEFCU in particular.

Doug (5:28)    

With the need for legal specialization and so many different areas for a credit union, is there a concentration in a particular area that causes the credit union to have enough scale and an area of focus—is that how you get to the size where you determine all right, we need in-house counsel? What are the metrics, the drivers around what would cause the credit union to start to consider that?

Kendra (5:55)   

I think as you become a more complex, larger organization, you start having legal issues, and I don’t mean the issues in the pejorative sense. I just mean legal matters that you need to handle pop up, right, whether it’s litigation, whether it’s increased regulatory scrutiny, whether it’s credit union advocacy, and now you’re at the size where you can actually make a difference with credit union advocacy and doing legislative process. As the boards get more complex, board governance comes into play. And contracts. Obviously, contracts are a huge part of it. All credit unions have outside vendors; we do a lot of outsourcing with third parties. So contracts are a huge issue. And I think the scale as you get bigger, you also get more complex and it just makes sense to bring in someone who sort of sees things through a little bit of a different lens and can help the business along in that regard. So I think that’s where they were landing. They decided to bring this role in-house.

Doug (6:55)   

At four and a half billion, there’s a huge amount of scale at that point. I wondered if it was any particular focus on this scale. I asked a couple of CEOs before this podcast what they wondered, and they wondered if the in-house counsel was mostly just hiring the external counsel that was there anyways. Talk to me a little bit about how it actually ends up working, please?

Kendra (7:22)   

Sure. I think now since I’ve been here for two years, we’ve grown; I think we’re at five and a half billion now. It’s absolutely a big part of it, managing that outside counsel, managing the spend for outside counsel relationships, and I don’t want to downplay the significance of that because it’s important. It’s also critical to manage that spend effectively and having one person doing that, I think, makes that more possible. So I won’t say that’s not a big part of it. But there are also a lot of issues we handle internally through my office as well. So most contract negotiations do not go to outside counsel; they’re handled by myself and my contracts manager. We use outside counsel for some specialized contracts that I’ll get into but we have regulatory compliance that rolls up to me, which is not necessarily legal strictly. But I work a lot with our compliance officer, and we try to handle as much in-house as we can. And we, of course, go to outside counsel where we need to. Credit union advocacy and legislative process is handled strictly in-house; we don’t have outside counsel for that—we work with the association. Strategic counsel to the business is another huge part of my role that’s not strictly legal. Board governance is also a huge part that we don’t outsource. I handle things on a day-to-day basis, like subpoena questions. And then just other random legal issues that arise on any given day. And where I do look to outside counsel is for specialized contracts like our technology-heavy contracts, auto lending, cybersecurity, where there are attorneys who spend their entire lives focused on this one small sector of the law, and the credit union and myself could benefit from their expertise in those areas. I absolutely rely on my outside counsel for that. M&A, so our M&A work. Another one of your friends, Jeff Cardone, with Luse Gorman. We’re working with him on our current merger. And that’s a very, very specialized area of the law, right? So if you don’t practice that every day, it’s good to have someone who does. Where we have litigation, I will bring in litigation counsel, so I would manage all of our litigation. Thank God we don’t have a lot—overseeing strategic direction on litigation, partner negotiations, on settlements, etc. But as far as litigating the actual case, I would hand that off to outside counsel as well. Our collections attorneys, the amount of that is just too broad for me to handle internally. More sophisticated patent and trademark legal issues we need to address I would bring in counsel for those. And again, cybersecurity, which I mentioned. It is managing the outside counsel spend. And it’s managing, making sure they’re billing you efficiently, they’re billing you consistently, you have a good working relationship with them, you understand setting expectations. But a lot of what I noticed is that I moved from roles where I was one of several lawyers in an office. So in government I was in the counsel’s office, it was only lawyers I worked with. The biggest shift for me moving in-house was I am now the only lawyer, and I have just the business clients alongside me and that has been a huge, huge, huge learning curve for me because I’m used to talking in legal jargon, I’m used to looking at things through a legal lens, and I’ve really had to shift my mindset to understand the business and understand what the business needs from that lens, but also be able to translate sort of between what the business is asking if we are using outside counsel, bridging that gap between what the business thinks they need and what the attorneys think they’re saying. And then me sort of somewhere in the middle, saying, here’s how we can actually do this most efficiently. Here’s the question, here’s how I need you to handle it. And here’s when I want you to handle it by. So that has been a huge learning curve, maintaining and creating that nexus between the business or existing outside counsels and also myself, making the business aware of legal issues. For the first few months, Doug, people didn’t know what to do with me when I was here. They were like, I don’t know what Kendra does, I don’t know what role she’s supposed to play. I don’t know when I’m supposed to go to her with questions. It took some time for people to understand what it meant to have an in-house counsel. Now that I’m two years in, everyone is very well versed with the department, and I work very, very closely with all of our business units and all of my “internal clients.” We’ve been developing that relationship for two years. And it’s really coming along, but it was a big learning curve for me.

Doug  (12:01)   

Thank you for that list. Is there anything in particular on that list that you think credit unions probably don’t get because they don’t use outside counsel for that? I noticed the strategic counsel was something that was not in my communications with CEOs, they did not put that on the list of things they do externally. So talk to us a little bit about that, and anything else you think having in-house counsel causes you to look at it differently.

Kendra (12:32)   

Yep, absolutely. So one thing my CEO regularly says to me when I say, I’m the lawyer, I pull the lawyer card, he says, you know, Kendra, you’re an executive who happens to be a lawyer. And that’s how I see you, right? And that was a shift in my perspective, where I realized his expectation of me is not only to provide legal advice to the business and to my internal clients, but also be a strategic business partner to understand the business, not from a legal lens, but to understand the actual business, understand and anticipate the needs of the business from both a legal and non-legal lens, and be able to advise him and the rest of the team on any issues, whether they’re legal or business or otherwise.

Doug  (13:21)   

That’s the strategic counsel portion. Is the advice on things as an executive not necessarily as a lawyer? Is that what you’re saying?



Doug  (13:29)

So talk to us about the process. In the last few years, you’ve been creating this legal department from scratch. So if you would wave your magic wand and go back and do it again, how would you suggest credit unions go about it? 

Kendra (13:44)

Here’s how I did it. So when I came, we had the compliance department, we had a contracts person. And they were somewhere else in the organization. When I came on board, they did some restructuring. So they now rolled up to me and they’re fantastic. And I couldn’t have gotten as far as I have gotten without either of their guidance. I would have hired myself a legal assistant earlier; I just did recently onboard one and she has also been a lifesaver for me just keeping my calendar on track. She’s also an assistant who comes from a law firm. So she understands how I think, how I work, what actually needs to get done. She’s very good at helping me prioritize. Having that sort of assistant while I’m focusing on building the rest of the department is really helpful, right? Because I want to look at all of our policies over our internal legal department policies. I want to develop legal internal policies. And that’s something I need to do but I also need to help the business run on a day-to-day basis and be responsive to the needs of the business. And so bringing on someone who wasn’t already dedicated to certain contracts or certain compliance areas would have probably helped me do that a little bit more efficiently. I did sit down with each of the C-level executives when I started and ask them how I could be beneficial, how they thought legal could help them in their roles because we really serve as a support function. I’m not driving any revenue to the business. I understand the legal department is a cost center. I’ve understood that from the beginning. So I’ve always been looking, how can we bring value? And how can we really support the business and make sure we get the business to where it wants to be. So you know, I don’t know I would have done anything majorly different other than probably get a little more support upfront, just so I could really focus on the substance of pieces I needed to focus on.

Doug (15:45) 

What have you needed from the executive leadership, as far as structure or guidance for you to be most effective?

Kendra (15:53) 

The executive leadership has just been absolutely fantastic. Every one of the people in our C-Suite has been supportive of my role, has been supportive of me. They’ve really helped me understand how the business runs. Because, again, I understand the legal issues, and I understand the legal issues pop up and how I would handle them through that strictly legal lens. But my colleagues have really been integral in me understanding how that folds into the business. And here’s the history behind that. And here’s why we did it this way. And here’s why we need to do it a certain way, or here’s where we need to land. They’ve been really integral in helping me develop that context and that color around the legal issues so I can handle them for SEFCU more effectively.

Doug  (16:42) 

When you talk to your peers, are they generally in credit unions in the 4 billion-plus range? Is that the size you’re used to seeing legal departments in?

Kendra (16:52) 

Yes. Even so, those legal departments are relatively small. In a different sector outside of the credit union movement, outside of financial services, their in-house legal departments may be 30 to 50 lawyers, depending on how big your organization is. Credit unions and the other credit union councils I know and have been introduced to run a very lean legal department, anywhere from a couple of people, usually one to maybe five to six lawyers is as big as I’ve seen. I’m sure there are bigger legal departments. But generally what I’ve seen is a smaller, tighter run ship. Not a lot of administrative support stuff. And so that’s where outside counsel comes into play too.

Doug  (17:37) 

So if you were to tell the credit union movement how to go about building a legal department, in the first place, you want to be very large, maybe solidly north of several billion. And the first hire was you, right? So the first hire was the attorney. And then shortly thereafter, you would hire some support for that person, and then internally consider who should be a part of that structure. Is that right?

Kendra (18:08) 

Absolutely. And I also think it makes sense to get a good e-Billing system on board right away. That’s something I brought on. That helps you manage your outside counsel spend, identify trends, see where you’re spending too much, see if you’re paying a higher hourly rate than other credit unions.

Doug  (18:29) 

Is there a savings? Is there some reduction in outside counsel spend?

Kendra (18:35) 

So there should be, and I think when you initially start, the answer is probably no. Because I come on board. I’m the first attorney. I’m now seeing things other people have not looked at through a legal lens, right? They’re not an attorney. They don’t look at it through a legal lens. But I do and I say I think we should look at that. I think we should take a little more interest in this. Why don’t we test this? So I think on the front end, likely not because we’re a cost center, I’m developing the legal risk profile of the organization. I’m trying to get a feel for it. But eventually, the intention is I’m bringing an in-house counsel who has enough expertise and can manage this enough so there is a reduction in outside counsel spend, either because you’re managing outside counsel more efficiently, or you are taking on more of that legal work internally as well. So absolutely, that is an absolute expectation.

Doug  (19:37) 

Is it so great that it actually creates savings? Or is it still a net increase in cost?

Kendra (19:42) 

I would hesitate to land on that definitively one way or the other, just because I’m still building my department two years in, right? So I want at least another year or so under my belt where I can start saying, okay, we’re actually a net savings here, net increase here. I’m still doing that evaluation. So ideally, that’s where I would like to get to. I would love it if I’m not a hard cost center for the organization. But I also think if you’re looking at this through strictly a dollars and cents lens, I understand the concern of bringing on in-house counsel is just going to increase costs. And you know, we’re financial institutions. So of course, we’re looking at it through that lens right off the bat. And again, on the front end, in particular, we come in and identify legal risks that were previously unchecked, which may mean more legal issues to work through. That increases your outside counsel spend, that increases your costs, I get that. But over the tenure of that legal department, it should reduce your compliance risk, it should reduce your business risk, it should reduce your litigation risk. And can you put a dollar figure on that? Maybe not. But it shows by things that are almost not happening. It’s trying to prove a negative in some instances, which is difficult to do. But even so, I think a significant part of the value proposition of outside counsel goes well beyond cost savings. It’s not just about someone coming in to reduce your outside counsel spend. They are a strategic business partner, not just legal counsel. And so that’s how I view my role. And that’s been an evolution, supporting the business, not just legally, but from the business perspective. And it’s going really well.

Doug (21:36) 

So, Kendra, any other thoughts for what credit unions need to know about when to think about creating in-house counsel, how to do the best job at it, or just plain how to think about working with outside counsel and doing that most effectively?

Kendra (21:52) 

Yeah, absolutely. Thanks, Doug. So I think as a credit union gets bigger, and the issues become more complex, and you’re seeing legal issues pop up here and there with more frequency, or as you get larger and there’s increased scrutiny, it’s a good time to start thinking about maybe bringing someone in-house and again, it doesn’t have to an entire 10-person, legal department by any stretch of the word. I think a lot of these run like me, where it’s just one lawyer, and it really should be viewed in the lens of they’re an executive who happens to be an attorney, because it’s not just the legal advice that will benefit the credit union. And I think it’s important to have someone with that lens in and have them in early, because you can steer discussions, you can steer away from risks, you can steer toward a more prudent path for the credit union to take before something goes wrong, or you need to hire outside counsel in a panic. They can just be an integral business partner as well as a legal partner. It’s a really interesting area of the law for lawyers who are interested in getting into credit unions. I think it’s sort of I won’t say new territory, the issues aren’t necessarily new, but credit unions and their relationship with lawyers I think is still very much evolving. But it’s just great to be part of the credit union movement. I think that’s another big factor. I didn’t want to go to work for a bank; I didn’t want to go into a law firm. I wanted to stick with the credit union movement because I believe in it. And I think it’s important to keep it going and if someone like me can put forth even just a little bit of value to a credit union that allows it to succeed then I will consider my job to be done and be done successfully. But it’s something I love to do. It’s interesting every day; I’m never dealing with the same legal issues ever. So it’s fantastic. As an attorney, it’s just a playground where you can evaluate all sorts of issues and all sorts of perspectives, and all sorts of subject matter areas and you can go as deep or as shallow as you want. And it’s just been a great experience for me, and I hope more credit unions do consider bringing on an attorney in-house.

Doug (24:21) 

Well, now I know the sign on your door says, “Welcome to the legal playground, we are glad you’re here.” Thank you, Kendra, thank you for your insights and for your work in the credit union movement. Hopefully, this will help other credit unions to make a successful decision in whichever direction they go with regard to in-house counsel. I will look forward to our next recording, which we’ll talk about in another month.


Excellent. Thank you so much. Great to talk to you.

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