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N.J. league PSG boards choose officers

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HIGHTSTOWN, N.J. (1/21/09)--The New Jersey Credit Union League's board of directors elected table officers for 2009, according to the league's newsletter, The Weekly Exchange (Jan. 19). They are:
* Chairman, Shawn Gilfedder, McGraw-Hill Employees, FCU, Hightstown ; * Vice chairman Leo Ardine, United Teletech Financial FCU, Red Bank ; and * Secretary/treasurer, Lou Vetere, Garden Savings FCU, Parsippany.
Also, the league's service corp, Professional Services Group, named these credit union leaders as board members:
* Issa Stephan, First Financial FCU, Toms River: * Linda McFadden, XCEL FCU, Secaucus; * Chris Chichester, Jersey Central FCU, Cranford; * Raymond Del Nero, Merck FCU, Rahway; and * Calvin Jackson, St. James AME FCU, Newark.
League President/CEO Paul Gentile serves as chairman of the PSG Board and league Chairman Gilfedder serves as vice chairman.

Shared branches important to boomers says CO-OP

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RANCHO CUCAMONGA, Calif. (1/21/09)--Shared branching is becoming increasing important in serving baby boomers and seniors, according to the CO-OP Shared Branching. "Forrester Research reports that fewer than half of all baby boomers and only 40% of seniors check their bank balances online," Carroll Beach president/chief operating officer for CO-OP Shared Branching, says in LoneStar Leaguer Jan. 20). "That's more than 39% of the country's population--some 116 million people." The two groups haven't developed a full trust in alternative forms of banking and still prefer the personal touch, Beach said. Forrester also made note of a demographic group larger than baby boomers and senior segments and which also isn't using the full range of online banking services. Except for Gen X users, many consumers who signed up for online banking still are not using the Internet to check account balances, transfer funds or pay bills. Roughly 23% of community bank customers use online services, even though they are enrolled in online banking. "As our society continues to be more on the move, shared branching is keeping up with the times--reducing credit unions' operational and branch-maintenance costs and ensuring convenience for members at any life stage," Beach said. CO-OP Shared Branching is based in Rancho Cucamonga, Calif. It represents 65% of all national shared locations and 80% of credit unions participating in shared branching.

Card processors breach may be the largest yet

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PRINCETON, N.J. (1/21/09)--Card payments processor Heartland Payment Systems announced Tuesday that its processing system was breached last year by a malicious software program in what could be the largest data breach to date, with possibly more than 100 million credit cards compromised. The information breached included card numbers and cardholders' names. It did not include merchant data, cardholders' Social Security numbers, unencrypted personal identification numbers, addresses or telephone numbers, said the Princeton, N.J.-based company in a press release. None of Heartland's check management or Canadian or payroll systems or its recently acquired Network Services and Chockstone processing platforms were affected , said Heartland. Heartland provides card processing for 250,000 business locations nationwide, most of them small businesses. About 40% of the transactions it processes are from small to mid-sized restaurants throughout the country. It also serves community banks, pay-at-the-pump gas stations, school campuses, parking lots and hospitality businesses. It handles more than four billion transactions a year, according to its website. "We found evidence of an intrusion last week and immediately notified federal law enforcement officials as well as the card brands," said Robert H.B. Baldwin Jr., Heartland president/chief financial officer. "We understand that this incident may be the result of a widespread global cyber fraud operation, and we are cooperating closely with the U.S. Secret Service and Department of Justice," he added. The company was alerted by Visa and MasterCard, which noticed suspicious activity among processed card transactions. Heartland took action to further secure its systems and will implement a next-generation program to flag network anomalies in real-time to assist law enforcement. Last week it found out the source of the breach: malicious software planted on the company's payment processing network that recorded payment card data as it was sent for processing to Heartland. Heartland has created a website, www.2008breach.com, to provide more information and advise cardholders to examine their monthly statements closely and report suspicious activity to their card issuers. Cardholders are not responsible for unauthorized fraudulent charges made by third parties, it said. It did not address who would be responsible if card issuers have to replace thousands of cards.

CU reports 177 increase in fin ed program

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HARRISONBURG, Va. (1/21/09)--DuPont Community CU (DCCU) has experienced a 177% increase in the number of participants in financial education classes and programs during the past two years, according to DCCU. The $629.4 million asset, Waynesboro, Va.-based credit union saw a 50% increase in contacts made through schools and organizations from 2007 to 2008 (Daily News Record Online Jan. 20). The credit union staff contacted 5,787 people in 2008 through financial education classes and programs. In 2007, the number of contacts was 3,852, and in 2006, it was 2,089. The financial education programs are age-appropriate and can be offered at public schools to help teachers meet Standards of Learning requirements. The credit union also teaches adult financial education classes. DCCU has conducted classes for 11 years. The classes are free and open to members of the credit union and the general public.

Michigan governor signs IDA-MBT credit bill

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LANSING, Mich. (1/21/09)--The Individual Development Account (IDA)-Michigan Business Tax (MBT) credit bill--one of the final pieces of Michigan Credit Union League (MCUL)-backed legislation pushed through during the 2008 lame duck session--was signed by Gov. Jennifer Granholm Jan. 9. Public Act 451 of 2008 allows companies who contribute to IDAs held at financial institutions to claim up to a 75% credit against their Michigan Business Tax liability, with up to $1 million available for the credit each year (Michigan Monitor Jan. 19). “This law will be beneficial for credit unions as we begin to see further IDA contributions from businesses, while more Michigan workers will be encouraged to open an IDA with a trusted financial institution,” said MCUL Executive Vice President Patrick La Pine. “The MBT credit incentive is helpful in this weak economy--not just for businesses, but also for consumers looking to improve their lives and for their financial institutions.” Individuals and entities making IDA contributions are eligible for an income tax credit, but the credit had yet to be extended to businesses making contributions. The legislation was introduced by State Sen. Tupac Hunter (D-Detroit). MCUL also worked closely with the Granholm administration, State Sen. Nancy Cassis (R-Novi), and State Sen. Mark Jansen (R-Grand Rapids) to pass the bill.

Check out CUs blog from inauguration

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SPOKANE VALLEY, Wash. (1/21/09)--Numerica Vice President of Lending Gene Fitzpatrick was blogging live Tuesday from the presidential inauguration in Washington, D.C. His blog can be accessed through the Spokane Valley, Wash.-based credit union’s website. Fitzpatrick also is working as a correspondent for the Spokesman-Review, a daily newspaper in Spokane. Fitzpatrick received tickets to the inauguration from Rep. Cathy McMorris Rogers (R-Wash.) at her office in Washington, D.C. Fitzpatrick had coffee with her and talked about the Troubled Asset Relief Program from his credit union’s perspective. McMorris Rogers invited Fitzpatrick back for a tour today, according to the blog. On Tuesday, Fitzpatrick arrived at the ticketed area for the inauguration and did a live interview with radio station KXLY 920 AM. The area was crowded, and it was difficult to communicate, he noted. Fitzpatrick is camped out in a recreational vehicle at American University, where his daughter, Erin, is a sophomore. Numerica, Spokane Valley, Wash., has $784 million in assets. For more information, use the link.

League CEOs letter to editor addresses tax issue

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ALBANY, N.Y. (1/21/09)--A letter to the editor written by Credit Union Association of New York President/CEO William J. Mellin responds to an earlier letter that suggests taxing credit unions the same as banks. Mellin's letter was published Sunday in the Watertown Daily Times. It chides the original writer for not doing his research. Had he done so, said Mellin, "he would have known that credit unions do pay taxes, including property and employer taxes. They do not, as Buckingham states, 'operate without any tax liability whatsoever." Mellin outlines the credit union difference, noting that credit unions' exemption comes from their structure as non-for-profit financial cooperatives that return all earnings to their members in the form of dividends and enhanced services. "In contrast, banks are required to pay corporate income tax because they are in the business of returning profits to paid board members and outside stockbrokers, not their customers," Mellin wrote. "Every taxpayer benefits from the credit union presence in the marketplace--they help drive down costs and fees associated with banking," he said, before describing them as local, member-owned, democratically controlled organizations "that represent a distinct financial alternative that individuals elect to join." Mellin also points out that credit unions don't engage in subprime lending and rampant loan origination without regard to credit risk that is at the core of the current financial crisis. "In fact, the practices of credit unions should be viewed as a model for ensuring the financial safety of all Americans," he wrote. "Since their beginnings a hundred years ago, credit unions have weathered every financial storm since the Depression of the '30s without ever costing taxpayers a penny or compromising members' deposits. Credit unions are not part of today's financial problems, but they are playing a part in the solution," he concluded. For Mellin's entire letter, use the link.

Invest in America heads to auto show

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LANSING, Mich. (1/21/09)--Invest in America --the vehicle loan programs formed by credit unions with General Motors and Chrysler recently--is at the North American International Auto Show, garnering additional publicity. According to the Michigan Credit Union League, the program is producing two 15-second electronic billboard displays at the show, which ends Saturday at Cobo Center in Detroit. The billboard will air twice per hour on two Jumbotron monitors inside and outside the conference center. One of the Jumbotrons will be visible for people driving by the center. The league estimates that the spots could be seen by more than 70,000 attendees and several hundred thousand more who drive by the event (Michigan Monitor Jan. 20). The ad focuses on the program's opportunity for more than 90 million credit union members nationwide to participate in the credit unions' agreements with the two auto manufacturers. For more information about the programs, use the link.

Iowa CUs raise 130000 for childrens hospitals

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DES MOINES, Iowa (1/21/09)--Iowa credit unions raised $130,401 for the Children’s Miracle Network in 2008. The amount is an increase of 6% from $122,956 in 2007. The funds were raised through the Iowa Credit Union Foundation. Linn Area CU, Cedar Rapids, raised the largest contribution of $17,533 through its “Credit Unions Love Kids” golf outing. Linn Area CU has $178 million in assets. The Iowa foundation also raised $6,500 for the network through its “Links of Love” promotion. Children’s Miracle Network raises money for more than 170 children’s hospitals nationwide. The Iowa foundation has helped Children’s Hospitals of Iowa City, Sioux City and Omaha to support research, purchase new equipment and provide educational materials.

CU System briefs (01/20/2009)

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* WASHINGTON and MADISON, Wis. (1/21/09)--This is the official legal notice to all members of the Credit Union National Association's (CUNA) 75th Annual General Meeting (AGM), scheduled for Monday, Feb. 23 at 11 a.m. at the Washington Convention Center in Washington, D.C. It will be held in conjunction with CUNA's Governmental Affairs Conference. The AGM will update member credit unions and leagues on the actions of their association over the past year. John Schneider, entertainer and co-founder of Children's Miracle Network, will be a special guest speaker … * ALBANY, N.Y. (1/21/09)--U.S. Rep. Joseph Crowley (D-Metropolitan) lunched with and spoke to the Metropolitan chapter of the Credit Union Association of New York. He discussed leadership changes in Washington, D.C.; the bailout measures; and how the measures affect credit unions. He said that now, more than ever, credit unions need to step up their advocacy efforts and become involved in taking their voices, separately and collectively, to their federal representatives. Crowley is chief deputy whip and the highest-ranking New York member of the House Democratic Caucus leadership. He sits on the Committee on Ways and Means and the Committee on Foreign Affairs. Pictured are, from left: Bob Dibaro, Local 804 FCU; Rosanna Creo, UNFCU; Rob Nemeroff, Melrose CU; Rep. Crowley; Robin Myers, Melrose CU; and Amy Kramer, Credit Union Association of New York, which arranged the meeting. (Photo provided by the Credit Union Association of New York) … * GRAND RAPIDS, Mich. (1/21/09)--CU*Answers, a credit union service organization (CUSO) based in Grand Rapids, announced the return of $400,000 in patronage dividends to its credit union owners for 2008. The return is a 100% increase over the $200,000 patronage dividend the CUSO announced in 2007. In the previous five-year period, CU*Answers returned $1.250 million in patronage dividends. Bob Frizzle, chief financial officer, said the 2008 dividends, when added to other returns given to its owners, have resulted in more than $1.14 million returned to owners in 2008 …