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Study's top kudos for rates go to CU, Oklahoma

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EL SEGUNDO, Calif. (1/31/13)--Oklahoma financial institutions offers consumers the best savings rates in the country and New Jersey's Rutherford Postal District Employees FCU is the financial institution that offers the best savings rate, according to a new study. It compares savings account interest rates offered by more than 4,000 local credit unions and banks.

Go Banking Rates calculated the average savings account rate in every state, according to its database, and ranked each state in order of highest average savings account rates to lowest.

Members of Rutherford (N.J.) Postal District Employees FCU can take advantage of a 2.52% annual percentage rate (APR), the rating company said.

The top states and their average for savings rates are:

  • Oklahoma (0.34% APR);
  • Rhode Island (0.32%);
  • Alabama (0.29%);
  • (tie) North Dakota (0.28%);
  • Utah (0.28%); and
  • Vermont (0.28%).
Four states (Florida, Iowa, Nebraska and Pennsylvania) tied for the worst account rate APR at 0.22%, while five states (Hawaii, Massachusetts, New Mexico, Virginia and West Virginia) and Washington, D.C. tied for the second lowest rates at 0.23%.

Online retailer fed up with bank, moves biz to CU

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TEMPE, Ariz. (1/30/13)--Fed up with big banks, and striving to reach a higher level of service for its business and customers, online retailer One Mall Group announced it is moving its financial business to local Desert Schools FCU in Phoenix from a national banking conglomerate. 

Moe Kittaneh, chief financial officer and president of One Mall Group in Tempe, Ariz., announced the move Friday.

"Recently, our experience with big banks was becoming a daily struggle, being bounced around from department to department with frequent constructed issues," Kittaneh said in a press release. "It became evident that they did not value our business or the art of customer service in general. I began looking into other options both local and national; what drew me to credit unions, and Desert Schools in particular, was the one-on-one service, competitive accounts, and the distinct feeling that my business would be valued."

At a time when big banks rank low in public opinion and favorability, credit unions saw record increases in membership over the past couple years. In reporting its decision to migrate, One Mall Group cited that trend, and a mounting dissatisfaction with the practices and operations of big corporate banks, such as raising fees and lackluster customer care.

At the end of October 2011--prior to the Bank Transfer Day on Nov. 5, 2011--the Credit Union National Association reported 93.6 million credit union memberships. At the end of November 2012, CUNA reported 96.1 million memberships. So nationwide growth was 2.7% in 13 months, CUNA's Economic and Statistics Department told News Now.

"Moe Kittaneh came in and was not satisfied with the service he was getting at his bank," Mike Foreman, Desert Schools vice president of retail sales and branch operations, told News Now. "Also, Kittaneh was not happy with fees related to his account.

"It seems like the situation here was his business was frustrated with its experiences at the bank, and pleasantly surprised that our credit union could fulfill his needs," Foreman added.

One Mall Group opted to publicly announce the change to inspire other small and mid-size businesses to consider local options when deciding on banking institutions. It said the partnership will provide it better treatment and more personal service. Also, the company anticipates improved efficiency in both employee and front-end business operations.

"I really liked the idea of using a local institution and being able to meet in person with those handling our accounts," Kittaneh said. "Not only does it help the local economy, it provides us, and thus our customers, a greater level of responsiveness and care. The Desert Schools' merchant account specialist I worked with was very professional and helpful throughout the entire process, and we look forward to a successful business partnership with the credit union."

Cirque du Soleil creation director Heward to headline ACUC

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MADISON, Wis. (1/31/13)-- Lyn Heward, director of creation for Cirque du Soleil, will be a headline speaker at the  Credit Union National Association's  America's Credit Union Conference this summer in New York City.

"Lyn skillfully relates the wonder of Cirque performances to 'wow' results for credit unions," said Jill Tomalin, CUNA senior vice president association services.

CUNA's ACUC runs from June 30 to July 3 at the Hilton New York in New York City.

Heward will speak July 2. Her presentation and book, "The Spark: Igniting the Creative Fire that Lives Within Us All," draw on her experiences as former president and chief operating officer of Cirque's creative content division, where she helped bring to life Cirque masterworks. Heward's presentation takes audiences behind the stage to explore the nature and origins of creativity.

Heward joins The New York Times best-selling author Malcolm Gladwell and retired White House Military Officer Lt. Col. Robert Darling as featured speakers at ACUC. The conference also includes a slate of thought-leader breakout sessions ranging from leading in a multi-generational environment to assessing one's credit union in the new economy. 

Among the operational topics on the slate are: Generating non-interest income, the future of payments and effectively managing lending risk.

Biz Kid$ fin ed grants available from NCUF

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MADISON, Wis. (1/30/13)--Applications for Biz Kid$ Financial Education Grants are available from the National Credit Union Foundation (NCUF) through March 31.

"There is a need to improve the financial literacy skills of the youth in America, and Biz Kid$ is the perfect vehicle to address that need," said Danielle Brown, NCUF Biz Kid$ program coordinator. "We are looking to fund innovative programs that improve the financial education of youth through the use of the Biz Kid$ program and encourage you to apply."

Biz Kid$ teaches kids about money and business. The financial literacy initiative, launched in 2008, includes an award-winning TV series, free classroom curriculum, outreach activities and a website targeting children 9-16 years old. 

NCUF organizes fundraising and outreach for the program. A coalition of more than 290 credit unions and affiliates nationwide have helped fund Biz Kid$.

The Biz Kid$ Financial Education Grant objective is to engage the credit union movement in building students' financial literacy and economic education skills while increasing awareness and use of Biz Kid$. Funds may not be used as a cash donation to a third party.

Each project should incorporate Biz Kid$ materials.

Eligible applicants include credit unions, credit union service organizations, state credit union associations, state credit union foundations, and other organizations owned or controlled by credit unions.

NJCUL's Reality Check sets agenda

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HIGHTSTOWN, N.J. (1/30/13)--Credit Union Reality Check, a conference hosted by the New Jersey Credit Union League April 8-10 in Atlantic City, is designed take attendees out of their comfort zones--in pursuit of inspiration and insight, according Candice Nigro, the league's director of marketing and communications.

"We've always been a little different than other conferences," Nigro told News Now. "We touch on topics that make people think, that are even a little controversial. We also try to make attendees truly feel they are part of the conference."

For instance, the conference does not conduct breakout sessions. Instead, attendees remain gathered in one group throughout the conference to encourage more networking, Nigro said.

Each attendee will be equipped with an electronic polling device to respond to questions from speakers throughout the conference. Results will be displayed instantly.

"This year we are going to ask questions before the conference and ask the same questions at the end to see if anyone's responses changed based on the information provided by the speakers," Nigro said.

Paul Gentile, Credit Union National Association executive vice president of strategic communications and engagement and former president/CEO of the league, will provide the welcome address for the conference.

Other sessions and topics include:

  • Max Wolff, chief economist and senior analyst, GreenCrest Capital, "Disruptive Technology Change Can Mean Opportunity for Credit Unions";
  • Moisette I. "Tonya" Sweat, National Credit Union Administration, director of consumer compliance policy and outreach, office of consumer protection, "NCUA: Rules, Remittances, Regulatory Updates and More";
  • Tom Farin, president, Farin & Associates, "Lessons in Applying Loan and Deposit Pricing Techniques to Funding and Loan Origination";
  • Lisa Renner, co-founder and managing principal, Renner Group, "Sleeping With the Enemy: How to Collaborate With Your Competition for Exponential Growth";
  • Jonathan Bowman, CEO of Clear Picture Leadership; "Picture Perfect Solutions"
  • Ed Speed, retired CEO of Texas Dow Employees FCU, Lake Jackson, Texas, "Be Bold, Make Loans, and Don't Fear the Regulator";
  • Theran Colwell, director of strategy and business development, CUNA Mutual Group, "Sustainable Growth for Credit Unions: A Look Forward and a Look Back";

NJ governor conditionally vetoes foreclosure bill

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HIGHTSTOWN, N.J. (1/30/13)--N.J. Gov. Chris Christie Monday conditionally vetoed a bill that would help transform foreclosed properties into affordable housing.

"The concept of the bill is good, but there were issues on how to finance it, which the governor indicated in his comments," Chris Abeel, the New Jersey Credit Union League's director of government affairs, told News Now. The league had not taken a position on the bill.

The bill would have established the New Jersey Residential Foreclosure Transformation Act to allow the New Jersey Housing & Mortgage Finance Agency to purchase abandoned homes under foreclosure and convert them into affordable housing units (The Daily Exchange Jan. 29).

In his veto message Christie said the bill would rely on the "unavailable and, in some cases unidentified, state funding sources."

In November, Christie vetoed a similar measure, which was combined with a proposal for expedited foreclosure of abandoned properties through a summary judgment process. The league did not take a position on that bill, either, Abeel said.

The legislature passed the summary judgment measure (S-2156) on a stand-alone basis which the governor approved in December. That bill was supported by NJCUL.

Christie also conditionally vetoed legislation that would have immediately raised the minimum wage to $8.50 and tied automatic annual increases to the Consumer Price Index. Abeel said the league was monitoring the bill on behalf of its members.

CU System briefs

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  • TULSA, Okla. (1/30/13)--A man treated at a local hospital for a gunshot wound was charged with the Jan. 23 robbery of Tulsa Teachers CU, Tulsa, Okla. During the robbery, a man wearing a ski mask jumped over a counter and demanded money. He placed an undisclosed amount into a backpack before taking funds from the cash drawers at another counter. A security guard chased the robber and fired several shots at him after he refused to surrender. Dehrain Eugene Berry Wilson, 22, was discovered later on the floor of a nearby home with a gunshot wound to his left arm. He was treated and charged with robbery with a dangerous weapon. Police allegedly found clothing matching the robber's and large amounts of cash at the home, plus a loaded revolver and ski mask outside a fenced yard (Tulsa World Jan. 27) …
  • BOSTON (1/30/13)--Patricia Piscioneri, 67, of Adams, Mass., faces up to 30 years in prison and a $1 million fine after pleading guilty Jan. 17 to embezzling $160,000 from the former Adams Municipal Employees FCU, which she managed. She also pleaded guilty in federal court to making false entries into the credit union's books. The thefts occurred between 2001 and 2005. Piscioneri allegedly created fraudulent loan accounts in the names of members and deposited the proceeds into her personal account or the accounts of her husband and relatives, or used the money to pay off previously fraudulent loans.  She also allegedly created fraudulent loan documentation such as applications and promissory notes, forged signatures and created false entries into the credit union's accounting system.  Sentencing has been set for April 25 ( Jan. 28) …
  • NEW BERLIN, Wis. (1/30/13)--Landmark CU CEO Ron Kase--who led the New Berlin, Wis.-based credit union to a milestone $2 billion in assets in September--is retiring after 39 years with the credit union. In 1973, he joined what was then Chabelco CU as manager. It had one location, $2 million in assets, four employees and more than 2,300 members. Today, Landmark has 28 branches, more than 500 employees and more than 200,000 members. Kase was named Credit Union Hero of the Year by Credit Union Magazine in June. After retirement, he will remain on Landmark's board of directors. He will be succeeded by Jay Magulski …
  • HERNDON, Va. (1/30/13)--Taking charge at Northwest FCU in Herndon, Va.--one of the biggest U.S. credit unions, with $2.5 billion in assets and serving 117,000 members--is new President/CEO Chris McDonald. He succeeds Gerrianne "Winky" Burks, who retired after a 41-year career at the credit union. McDonald has 28 years of experience working in the credit union industry, most recently serving as CEO of Andrews FCU in Suitland, Md. He first began working with Northwest FCU last fall, collaborating with the board and senior management team to ensure a smooth transition of leadership …
  • FENTON, Mo. (1/30/13)--Dennis Sommer, president/CEO of Alliance CU in Fenton, Mo., announced he will retire March 1. His retirement ends a 40-year career in the credit union industry--28 years as Alliance's president/CEO. Sommer joined the credit union--then called Emerson Community CU--in 1985 as president/CEO.  At the time, the credit union had $18 million in assets and served about 9,000 members, mostly employees of Emerson Electric. Today, Alliance has more than $196 million in assets and serves more than 17,000 members. Alliance is the 11th largest credit union in Missouri. Sommer will be succeeded by Tim Stephens, Alliance executive vice president ...

Social media study: What makes CUs attractive to consumers

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BOSTON (1/30/13)--What makes credit unions so attractive and inviting? Better customer service tops the list, according to an analysis of more than 220,000 posts from a social media library conducted by Crimson Hexagon, a social media research group in Boston.

Nearly 17% of the posts touted credit unions' better member/customer service, said the company, which analyzed posts over 11 months to understand why consumers join credit unions.

"Operating under a different business model than their traditional counterparts, credit unions are not-for-profit, member-owned financial entities," said Crimson Hexagon. "Recently, credit unions have become an increasingly popular banking alternative for consumers in the U.S. As a result, traditional banks have come to view credit unions as formidable competition--often including key players in competitive research and social media analysis."

The group's conclusion: "At a growing rate, consumers believe that they will receive superior customer service through the credit union model," said the report.  "In fact, the proportion of conversation related to joining credit unions because of customer service has increased 20% since January 2012," it added.

"Consumers also identify with an intangible benefit of these institutions: credit union membership feels like you are part of a community," said the company.

The study is well-timed; the Credit Union National Association recently announced its key communications goals center on making more people aware of the value of credit unions.

Other reasons consumers cited in the study for making credit unions their choice included:

  • Help me build credit, raise score, cited by 15%;
  • Grant higher credit limits, 14%;
  • Lower interest rates on loans, 14%;
  • Savings on fees, 13%;
  • Credit unions foster and support community, 9%;
  • General displeasure with  previous bank, 8%;
  • Big banks are unethical, 7%; and
  • Better rewards program, 3%.
"In this industry," said the report, "credit unions uniquely enjoy the reputation of being community builders. Consumers favor these institutions because they are perceived to foster communities--both among its own members and in local areas."

"Nuanced discussions within this conversation include the belief that credit unions are genuinely concerned with leaving a positive footprint in their regional areas of operation, and they don't view their members as numbers--or dollar signs."  Although this sentiment represents 9% of the conversation, "its proportion relative to all other reasons for joining credit unions has increased 12% since January 2012."

Hacktivist group calls off cyberattacks, diligence advised

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WASHINGTON (1/30/13)--A group of hacktivists allegedly responsible for distributed denial of service (DDoS) attacks against 22 large U.S. banks and at least two credit unions announced Tuesday it is calling off the attacks. However, that doesn't mean all such attacks will stop.

The Credit Union National Association has reached out to and is working with the U.S. Treasury's Financial Services Sector Coordinating Council for Critical Infrastructure Protection and Homeland Security to ensure credit unions' interests are represented in the federal government's efforts to help deal with any future attacks.

DDoS attacks typically are conducted for political or ideological reasons, according to Mike Saylor, vice president of technology at the Texas Credit Union League. "There are other reasons for conducting DDoS attacks, but these are the most prevalent, and this type of attack will  continue into the foreseeable future," he said in the league's newsletter (LoneStar Leaguer Jan. 29).

The al Qassam Cyber Fighters' message on Pastebin, an Internet message board, said its attacks are suspended because YouTube removed a trailer advertising of an anti-Muslim film, "The Innocence of Muslims."

It said the group "lauds this positive measure of You Tube and on this basis suspends this operation and plans to give a time to Google and U.S. government to remove the other copies of film as well. During the suspension of Operation Ababil, no attack to U.S. banks would take place by al-Qassam cyber fighters" (Bank Info Security Jan. 29).

The DDoS campaign--the group's second campaign within six months--began its eighth week of attacks Monday. Tuesday's message said the victims of its attacks included the $3.8 billion asset Patelco CU, Pleasanton, Calif., whose website was down five hours, and $1.6 billion asset University CU, Austin Texas, whose site was down two hours. The Pastebin post also named a who's who list of 22 big banks, including Bank of America, Wells Fargo & Co., Capital One, Citibank and JPMorgan Chase. The credit unions emphasized that no member data was compromised during the attacks.

Denial of service attacks have been around a while, said Saylor. "The first DDoS was in the 1880s when teenagers brought down our first phone system."  DDoS attacks a target, such as a website or a network, by flooding the targeted systems with large volumes of data until the systems are overwhelmed and cannot process the data fast enough, Saylor said. The system typically shuts down or freezes.

He advised credit unions to "be diligent. If you start to see degradation in your systems, then you must be timely in your response and communication." Here are four steps to take:

  • Preparation. Establish contacts, define procedures, and gather tools to save time during the attack.
  • Analysis: Detect the incident, determine its scope and involve the appropriate parties.
  • Mitigation:  Mitigate the attack's effects on the targeted environment; and
  • Wrap-up: Document the incident's details, discuss lessons learned and adjust plans and defenses.