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CU System Archive

CU System

More CU phish tales surface

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MADISON, Wis. (12/21/07)--More phish tales from credit unions in three states surfaced this week, just as reports from a nationwide survey announced that 3.6 million U.S. consumers lost $3.2 billion in online phishing attacks this year. According to Stamford, Conn.-based research firm Gartner Inc., this year's loss figures are an increase from 2.3 million people who lost money last year. Gartner surveyed 4,500 online adults (United Press International Dec. 19). Meanwhile, credit unions and related organizations in Virginia, Pennsylvania and Ohio, were alerting their members about phish attempts.
* In Lynchburg, Va., Beacon CU was targeted when Cindy Kozerow, a crime prevention specialist for the Lynchburg Police Department, received a call before 6 a.m. Tuesday. The prerecorded message said Kozerow's credit union account had a problem and told her to visit a website and enter personal information. She recognized the call as a phish scam. A caller ID listed a Western Ways store in Lynchburg, but the call didn't originate from there or from the credit union (The News and Advance Dec. 20). * In State College, Pa., Penn State FCU's website alerted members that a message purporting to be from the credit union was a scam. The credit union said individuals with Penn State University e-mail addresses received messages with subject lines such as "Unauthorized Activity!" The e-mail messages told the recipients to click a link to a fake website (Penn State Live Dec. 18). * The Ohio Credit Union League alerted readers in its Dec. 19 eLumination Newsletter that a phishing e-mail on Dec. 7 claimed to be from the Ohio Credit Union System. It was sent to consumers' addresses and asked them to verify their credit union and member account by visiting a link and typing in their credit card and account numbers.
Each target emphasized it would never solicit financial and personal information via the Internet or telephone. Despite consistent media alerts about phishing attempts, the Gartner Inc. survey indicates many Internet users aren't heeding the message to avoid providing personal and financial information via unsolicited e-mails and callers (Washington Post Dec. 19). Of surveyed consumers who received phishing e-mails as of August this year, 3.3% said they lost money. That compares with 2.3% in 2006 and 2.9% in 2005. The average dollar loss per incident declined--to $886 from last year's $1,244--with a median loss of $200 in 2007. However, about 1.6 million respondents recovered about 64% of their losses, up from 54% that 1.5 million adults recovered last year. Of those who lost money, 47% said they used a debit or check card for online transactions. Also, 32% listed a credit card as the payment method, while 24% said they paid with a bank account.

TJX settlement approved by Visa FIs

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FRAMINGHAM, Mass. (12/21/07)--Financial institutions representing more than 95% of eligible U.S. Visa accounts potentially affected by The TJX Cos. data breach have accepted an alternative recovery offer under TJX's previously announced settlement, Visa told the Credit Union National Association (CUNA) Thursday. The settlement is with Visa U.S.A. Inc., Visa Inc., and TJX's U.S. acquiring bank. Completion of the deal was pending acceptance by 80% of the financial institutions. Under the settlement, TJX agreed to fund up to $40.9 million in alternative recovery payments. These costs are already reflected in the charge related to the computer intrusions that TJX took in its fiscal 2008 second quarter. Credit unions and other financial institutions that accepted the alternative recovery offer will receive their payments by Dec. 27. Each accepting issuer has waived certain rights to any other recovery through litigation or otherwise and provided certain releases of TJX and its U.S acquiring banks. "Ensuring that credit unions issuing Visa cards affected by the TJX data breaches were included in loss recovery efforts has been very important to CUNA," said Eric Richard, CUNA's general counsel, "and we have endeavored to assist our members as much as possible throughout this process to provide the latest developments as we learned of them. "This appears to be a good outcome for financial institutions, but we will continue to monitor the situation as the settlement is finalized," Richard said. CUNA discussed with credit unions their options for pursuing recovery of losses related to Visa cards involved in the TJX breaches, including the $40.9 million settlement with Visa and Fifth Third Bancorp, TJX's credit card payments processing bank. The agreement does not include other card associations such as MasterCard. "We do not have a reason to believe at this time that MasterCard will be offering a separate settlement but will keep credit unions posted on any further information we obtain from MasterCard," Richard said.

PCUAs Go Green effort spotlighted on TV

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HARRISBURG, Pa. (12/21/07)--The Pennsylvania Credit Union Association’s (PCUA) “Go Green” initiative was taped for television Wednesday. In a segment of “Pennsylvania Newsmakers,” the new environmentally friendly initiative was discussed by PCUA President/ CEO Jim McCormack and Pennsylvania Credit Union Foundation Executive Director Joe Wambach (Life Is A Highway Dec. 20). During the program, McCormack and Wambach discussed credit union programs already in place for hybrid auto loans, and how the PCUA will share information about other credit union “green” projects through its newsletter, Life Is A Highway. Wambach also will chair a task force to help credit unions implement environmentally friendly practices and activities. The segment, which is part of the PCUA’s monthly financial education sponsorship of the program, can be viewed throughout Pennsylvania from Jan. 5 through Jan. 8.

CU System briefs (12/20/2007)

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* DUBLIN, Ohio (12/21/07)--The Ohio Senate Finance and Financial Institutions Committee has recommended Senate confirmation of Gov. Ted Strickland's appointee to the state's Credit Union Council. Robin Thomas, CEO of $78 million asset Taleris CU, Cleveland, is the appointee (eLumination Newsletter Dec. 19). The seven-member council, part of the Ohio Division of Financial Institutions, meets quarterly and provides advice and recommendations on credit union issues to the regulatory agency. The council is chaired by Deputy Superintendent for Credit Unions Rose Bartolomucci. Other members include John Lattanzi, Credit Union One, North Jackson; Aaron Michael, Atomic CU, Waverly; Linda Williams, Akron Fire Fighters' CU; and Matthew Studer, Toledo Postal Employees CU … * HERNDON, Va. (12/21/07)--Northwest FCU Foundation donated $5,000 to Dranesville Elementary in Herndon, Va., to help fund professional staff development programs. NWFCU is in its fourth year as a school business partner and provides financial education to students and families through reading programs, student assemblies, staff development and resource materials. Pictured at the check presentation during a school assembly are, from left: Linda Rogus, managing director of the foundation; Lucinda Romberg, school principal, and Juri Valdov, NWFCU president/CEO and chairman of the foundation. (Photo provided by Northwest FCU Foundation) …

State senator testifies on need for Ohio CU legislation

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COLUMBUS, Ohio (12/21/07)--Testimony on credit union modernization legislation in Ohio, Senate Bill 247, was conducted Dec. 13. Bill sponsor State Sen. Bob Spada (R-North Royalton) testified before the Ohio Senate Finance and Financial Institutions Committee (eLuminations Newsletter Dec. 19). Spada said the bill is intended “to help Ohio’s credit unions in their operations, administration and governance to better serve their members and communities.” Bill provisions relate to operational issues such as record keeping, ballots, payable-on- death accounts, merger requirements, and representation requirements for the Ohio Credit Union Council, an advisory group with the state’s regulatory agency. “These changes are based on issues raised this year by credit union officials, league staff, and the Ohio Division of Financial Institutions,” said John Kozlowski, general counsel at the Ohio Credit Union League. The committee is expected to hear further testimony when the state’s General Assembly returns from recess in January.

Michigan raises small-CU threshold to 35 million

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NORTHVILLE TOWNSHIP. Mich. (12/21/07)--Trustees of the Michigan Credit Union Foundation have changed the asset-size threshold for small credit unions' eligibility for scholarships. The change, to $35 million from $20 million in assets, will make more credit unions in the state eligible for scholarship assistance. The trustees approved the management recommendation on Dec. 11, according to the Michigan Credit Union League (Michigan Monitor Dec. 17). The new standard raises the number of credit unions eligible for the foundation's $1,000 scholarships to 176 credit unions from 139 and aligns more closely with the threshold used by the Credit Union National Association. The change reflects the changing credit union marketplace, said Alan Babcock, league CU Strategic Solutions vice president. "As credit unions continue to grow, the industry threshold for small asset size (SAS) credit unions has also needed to keep pace," he told the Monitor. Will the foundation have enough funds to accommodate the scholarship requests of the new small-CU designees? Yes. The foundation budgeted additional grant funds in 2007 for SAS credit unions on a needs basis, but the funds weren't used, said Babcock. Reallocating part of the funds to the general scholarship budget will cover the expected increase.

Payday lender quits Pennsylvania

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HARRISBURG, Pa. (12/21/07)--A payday lending company announced it is pulling out of Pennsylvania and will close its 66 stores currently operating in the state, says the Pennsylvania Credit Union Association (PCUA). Advance America, Cash Advance Centers Inc. closed 31 state offices in the third quarter after a state court forced it to cease lending in Pennsylvania (Life is A Highway Dec. 20). “We congratulate the [Pennsylvania] Banking Department on ridding Pennsylvania of this particular predatory lender,” said Jim McCormack, PCUA president/CEO. “Unfortunately, there are many others still operating in the state, which is why our Better Choice program is so desperately needed in the marketplace. “I would also like to congratulate the 63 Pennsylvania credit unions that offer the Better Choice program at 180 locations,” he added. Better Choice is the Pennsylvania credit unions’ low-cost payday lending alternative.

Arizona State CU grants 25000 to worker training program

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TUCSON, Ariz. (12/21/07)--Arizona State CU, Phoenix, announced that it is giving a $25,000 grant to benefit Tucson’s Community Housing Corp. The grant will help clean landfills, provide computer-skill training to the homeless, and provide used computer equipment to low-income neighborhoods. Workers will remove electronic waste from landfills, and then repair computers and return them to use. As they develop skills and gain certification, they will be employed part-time while the program helps them find full-time jobs. The computer equipment they repair will be provided to low-income neighborhoods at little or no cost. “This is a long-term solution that will add a significant number of marginalized individuals to the work force and provide them the opportunity to earn their way to a better life,” said Arizona State CU President/CEO David E. Doss. Pima Computer Recycling, a subsidiary of the housing corporation, approached the credit union with the worker training program. Pima’s goal is to help the marginalized--most workers will be referred from local homeless shelters. Through its membership with the Federal Home Loan Bank of San Francisco, Arizona State CU obtained the $2,500 Access to Housing and Economic Assistance for Development grant. The credit union then distributed the funds to Pima for the program. Arizona State CU has $1.1 billion in assets.

Ohio House committee working on three payday lending bills

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DUBLIN, Ohio (12/21/07)--Ohio House Financial Institutions, Real Estate and Securities Committee members recognized the benefit of credit unions during testimony for three payday lending bills two weeks ago. Many credit unions offer small short-term loans, said John Kozlowski, Ohio Credit Union League general counsel. However, the committee also recognized that credit unions’ scope is limited. Only 25% of Ohio’s population belongs to credit unions. “Not everyone is a credit union member nor is eligible to join a credit union in the area,” Kozlowski said. Currently, check cashers in Ohio can charge borrowers 5% interest each month on their loans, and two of the bills would seek to change limits on interest rates. The first bill, H.B. 333, sponsored by state Reps. Bill Batchelder (R-Medina) and Robert Hagan (D-Youngstown), would allow check-cashing lenders to charge 36% annually on loans. H.B. 358, sponsored by Rep. Tyrone Yates (D-Cincinnati), would allow lenders to charge 25% annually. H.B. 337, sponsored by Reps. Ross McGregor (R-Springfield) and Matt Lundy (D-Elyria), would maintain the current rate of 5% interest each month. The committee also considered a statewide database of loans outstanding by check-cashing businesses and financial counseling to help consumers. More hearings on the bills are expected in January.

RMJ Foundation donates 106150 to financial ed efforts

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RANCHO CUCAMONGA, Calif. (12/21/07)--Recent community service grants given to credit unions will benefit youth in Santa Cruz County and immigrant college students in Southern California. The Richard Myles Johnson (RMJ) Foundation, the state foundation for credit unions in California and Nevada, gave $56,150 in community service grants to Orange County’s CU in Santa Ana and Santa Cruz Community CU in Santa Cruz. A second donation of $50,000 was made to season two of the Biz Kid$ television series. Orange County’s CU’s $40,000 grant will help the credit union’s partnership with two local organizations, including the Cerritos College Foundation in Norwalk. The Cerritos College Health Opportunity Pipeline for Education is designed to increase the number of underrepresented students in the health profession. It also includes a component developed by the credit union that offers community workshops on financial aid and investing in education. The credit union also is working with the Long Beach Community Hispanic Association program, which is scheduled to debut in spring 2008, to turn area youth into peer trainers for their communities. Part of the association’s Latinos Investing for Tomorrow program includes a financial literacy component developed by the credit union. Santa Cruz Community CU’s $16,150 grant will support the credit union’s new financial literacy program targeting foster youth in the county. The pilot program will begin with five of the area’s 35 to 40 youth on track to leave the foster care system as they get older. The goal is to teach youth how to manage a budget, living expenses, and accumulate savings. Participants also can open individual development accounts at the credit union. “We hope the initial group of foster youth will become the cornerstone of a successful literacy and savings program that will eventually reach more youth in our community,” said Ginger McNally, Santa Cruz Community CU CEO. The RMJ Foundation provides community service grants to support credit union efforts in spreading financial literacy to young people.