Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

CU System Archive

CU System

CUs 'left holding the bag' in breaches, Adams writes Stabenow

 Permanent link
LANSING, Mich. (1/22/14)--In a letter to U.S. Sen. Debbie Stabenow (D), Michigan Credit Union League President/CEO Dave Adams addressed the financial liability of merchants when data breaches occur.
 
"Despite standards held up by the retail industry as protections for consumer data, industry self-policing and enforcement of such is inadequate and often retroactive," Adams wrote in a Jan. 10 letter.
 
"This becomes less startling, however, when one considers that it is the financial institution supporting the breached card, and not the retailer, that is often 'left holding the bag' for the initial costs related to card replacement (including analysis and member communication) and the later cost of fraud itself."
 
Initial results of a survey by the Credit Union National Association show that credit unions already  have incurred $30 million in costs since the announcement of retail-giant Target's massive data breach (See related story: "Target breach to cost CUs estimated $25M-$30M, CUNA study shows"). More than 40 million credit and debit card accounts and personal information of 70 million consumers was compromised in the breach that occurred around prime holiday shopping season last year.
 
Adams queried why financial institutions and their members bear the consequences of a retailer's failure to adequately store and protect consumer data.
 
"Shouldn't a retailer be held accountable for their own inadequate efforts, and shouldn't there be some recourse for those harmed that must ultimately bear the costs involved?" he wrote.
 
In a Friday column on Huffington Post, CUNA President/CEO Bill Cheney also called for merchants to be held financially liable for the impact on consumers and their financial institutions.
 
Adams referenced the Dodd-Frank Act-imposed debit interchange cap, too. "As you will recall, during the passage of Dodd-Frank, the 'Durbin amendment' shifted billions of dollars of interchange income from financial institutions into retailers' pockets, with no identifiable price-relief or benefit to consumers."
 
On Friday, the debit card interchange case NACS, et al. v. Board of Governors of the Federal Reserve System was heard by the U.S. Court of Appeals for the District of Columbia. (See Tuesday's News Now: "Appeals court to closely examine lower court interchange ruling.")

CU partner Chatzky tells expo: Financial, physical health are equals

 Permanent link
WASHINGTON (1/22/14)--Financial expert Jean Chatzky tied financial health to physical health during her appearance at the NBC 4 Health and Fitness Expo Jan. 11.
 
Financial expert Jean Chatzky, center, and credit union staff from the Washington, D.C., and Maryland area helped consumers check their financial fitness at the NBC 4 Health and Fitness Expo Jan. 11. (MDDCCUA photo)
"When you are in great shape financially, you are less worried, stress free and feel much better," said Chatzky, director of education at SavvyMoney and financial editor for the "Today" show.
 
After her speech at the Washington, D.C., expo, she spent one-on-one time with attendees, signing copies of her "Money Rules: The Simple Path to Lifelong Security."
 
More than 60 credit union representatives helped hundreds of attendees complete the SavvyMoney checkup at the Dollars & Sense Credit Union Pavilion.
 
The pavilion and Health and Fitness Expo advertising were made possible by 20 participating credit unions; MDDCCUA and its D.C. and Suburban Maryland chapters; the Virginia Credit Union League; the Credit Union Foundation of MD and DC;  the National Credit Union Foundation; SavvyMoney; and CUNA.

Pierce pens pro-CU op-ed for Kansas City Star

 Permanent link
KANSAS CITY, Mo. (1/22/14)--Dennis Pierce, CEO of Lenexa, Kan.-based CommunityAmerica CU, noted the historical significance of 2014 and credit unions' creation in a Monday op-ed in The Kansas City Star.
 
This year marks the 80th anniversary of the Federal Credit Union Act, in which "Congress created credit unions in response to the stress on family pocketbooks in the depths of the Depression," he wrote. In order to make family money management economical, lawmakers included an institutional tax exemption because "credit unions are mutual or cooperative organizations operated entirely by and for their members."
 
Pierce said, "Today, Congress is hearing special interest suggestions to remove this exemption, despite the festering recession. Doing so would create a new tax burden on the nation's 96 million credit union members, the vast majority of whom are middle- and lower-income individuals struggling to make ends meet."
 
He dispelled the myth that credit unions don't pay taxes, listing the types they do pay--property, tangible personal property, employee payroll, unrelated business income, sales, and state franchise.
 
Pierce cited research that removing the tax exemption would remove $6.3 million in consumer spending in Kansas alone, with similar results expected in Missouri.
 
"Though most agree our federal tax system needs work, taxing the one financial institution system serving 96 million Americans is not the way to do it," Pierce wrote, adding, "Congress today should remember the wisdom of its 1934 class of predecessors and ensure that the credit union tax exemption is sustained for the benefit of American consumers."
 
Pierce, who leads the $1.8 billion-asset credit union, also is the incoming chair of the board of directors for the Credit Union National Association.

CUNA, Cooperative Trust pick 47 Crashers for GAC

 Permanent link
MADISON, Wisc. (1/22/14)--A historic financial "crash" has never felt this good.

A record number of young credit union professionals will be participating in this year's fifth annual Crash the GAC, the Credit Union National Association and the Cooperative Trust announced Tuesday.

Representatives of credit unions from 46 states and the District of Columbia will be participating in the event, designed to bring upstarts to CUNA's Governmental Affairs Conference, which is in Washington, D.C., Feb. 23-27.

"I believe we need to develop next generation leaders to grow, promote and sustain the credit union movement," said Jill Tomalin, CUNA executive vice president and chief operating officer.

Cooperative Trust Leader James Marshall said that his organization has also been "working with state leagues to really embed their Crasher into their advocacy efforts throughout the week."

CUNA and the Cooperative Trust partnered with state leagues to select Crashers from a record pool of applicants, resulting in the largest Crash event to date. Nineteen young credit union professionals attended last year's event.

Crash the GAC gives young credit union professionals the chance to attend exclusive speaker sessions as well as experience GAC's core events.

Featured speakers at CUNA's signature conference this year include former British Prime Minister Tony Blair, former U.S. Secretary of State Madeleine Albright, and four sitting U.S. lawmakers--Sen. Mark Begich (D-Alaska), House Minority Whip Steny Hoyer (D-Md.) and Reps. Shelley Moore Capito (R-W.Va.) and Peter King (R-N.Y.).

For a full list of the 2014 Crashers, use the resource link.

CUs 'no threat' to banks, Dakotaland CEO tells S.D. forum

 Permanent link
HURON, S.D. (1/22/14)--South Dakota credit unions continue to beat back a pro-tax message being pushed by the state's banking association.
 
On Jan. 16, Dan Cumbee, president/CEO of $234 million-asset credit union Dakotaland FCU, spoke to the Beadle County Democratic Forum in Huron (Plainsman Jan. 20). 
 
The only motivation behind forcing credit unions to pay taxes like banks is to put credit unions out of business, he told the forum.
 
Since late last year, the South Dakota Bankers Association has been trying to get local governing bodies such as school boards, chambers of commerce, city and county commissions to take up a resolution to change the tax status of state credit unions and farm credit services. (See Jan. 15 News Now: "Banks' 'concerned' citizens a no-show in S.D. tax-status fight.")
 
Cumbee, who has been with the Huron-based credit union for 27 years, said credit unions are no threat to banks. State bank assets are at $113 billion compared with credit union assets of $2 billion.
 
In a basketball game, "You're behind 113 to two," he said. "That's what the score is in South Dakota, and yet the banks are concerned we've become a threat or that we are too successful."