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CU System

Ex CU manager admits to theft avoids jail time

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HINGHAM, Mass. (2/7/12)--The former manager of Hingham FCU received a suspended two-year jail sentence after confessing the theft of more than $100,000 from the credit union.

Joanne Taylor used her position as manager of the $46.5 million asset Hingham, Mass.-based credit union to remove money from members' accounts, which were later replenished with credit union funds (The Patriot Ledger Feb. 6).

The theft was discovered by a member whose funds had not yet been restored.

Prosecutors sought a one-year jail term for Taylor, who pleaded guilty to two counts of larceny of more than $250. Instead, Taylor was sentenced to the suspended jail term, five years of probation and restitution of $35,000, which represents the amount of stolen funds not covered by insurance.

SACU hosts Bandit Shield Program

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SAN ANTONIO (2/7/12)--San Antonio CU (SACU) is the first San Antonio financial institution to comply with a local program designed to reduce bank robberies, and to assist local, state, and federal law enforcement with their robbery investigations.

Click to view larger image The Federal Bureau of Investigation (FBI) and San Antonio Police Department (SAPD) launched the Bandit Shield Program in San Antonio Friday. San Antonio CU's main branch received the first decal issued in San Antonio, indicating the credit union has complied with the security and training requirements for the program. Pictured, from left, Robert Ramos, Jr., FBI; Erik Vasys, FBI; Capt. Adolph Zuniga SAPD; Dennis May, FBI; Jim Peters, SACU loss prevention officer; Shawn Scott, FBI; and Lt. C.W. Williams, SAPD. (Photo provided by San Antonio CU)
The Bandit Shield Initiative is a joint effort of the Federal Bureau of Investigation (FBI) and San Antonio Police Department. The regional crime reduction venture was developed through the collaboration of local law enforcement and the FBI, with input from financial institutions nationwide concerning methods that have worked to deter robberies and assisted in solving crimes.

As the first to participate, SACU's main branch received the first decal issued for compliance with the program.

"SACU is doing everything we can to ensure the safety of our members and their assets," said SACU Loss Prevention Officer Jim Peters. "Putting security measures in place and preparing our employees to respond is important in this process. When would-be robbers see the orange Bandit Shield decal on our branch window, they may think twice before taking action."

Although the program is not mandatory, other San Antonio-area financial institutions are encouraged to participate.

Va. CU offers fin ed to state Senate pages

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Richmond, Va. (2/7/12)--Virginia CU, with $2.2 billion in assets, Richmond, Va., recently hosted a financial education session for students who serve as Senate of Virginia pages and messengers.

Cherry Hedges (middle), financial education director for Virginia CU, works with two of the 34 Virginia Senate pages who participated in a financial education session offered by the credit union Jan. 30. (Photo provided by Virginia CU)
Cherry Hedges, Virginia Credit Union's financial education director, led the students through an hour-long presentation that included hands-on budgeting activities.

The students developed budgets based on the average income for several occupations. The students were randomly assigned careers, such as short-order cooks, child-care workers, legal secretaries, mail carriers, financial planners, physicians and others. The students considered the impact of careers on future-earning potential and learned to construct a realistic monthly budget based on the salaries they were assigned.

The lesson also included information about debit cards, credit cards, cash and checks. The students discussed opportunity cost and the importance of managing credit as adults.

The 34 students, most of whom were 13 or 14 years old, are in Richmond during the General Assembly session and serve the Senate clerk's office. The financial education session was one of several educational sessions offered while the General Assembly is in session.

iNY Timesi praises CU credit builder loans notes aSmarterchoice

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MADISON, Wis. (2/7/12)--A New York Times article this week cited credit union credit-builder loans as a way to help consumers establish credit or improve their scores.

"Credit builder loans are offered as a way for credit union members to do a couple of things: get something good on their credit reports and set aside some money for future use," credit scoring guru John Ulzheimer said in the article, which appeared in the New York Times "Bucks" blog.

The article explained that credit-builder loans typically work in one of two ways:  Under one arrangement, the borrower makes payments on the loan over a period of time, perhaps a year, and the credit union puts the money in an interest-bearing savings account. Once the loan is paid off, the borrower gets access to the money.

In another instance, the borrower may provide the money to the lender, who then puts the money in an interest-bearing savings account as collateral. Then, the lender provides a line of credit up to that amount, which the borrower pays off in monthly installments.

Under both arrangements, the lender reports the borrower's payments to credit reporting agencies.

Steven Rick, a senior economist at Credit Union National Association (CUNA), told New York Times reporter Tara Siegel Bernard that nearly 15% of the 7,400 credit unions in the U.S. offer a credit builder program.

"You can see if you're eligible to join a credit union through the aSmarterChoice.org website, though you'll have to call or go to credit union's individual sites to see if it offers these loans," Bernard wrote.

N.C. league seeks dialogue with regulators on dual exams and other issues

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RALEIGH, N.C. (2/7/12)--The North Carolina Credit Union League held a special meeting with its members Wednesday last week to discuss how the National Credit Union Administration (NCUA) and the North Carolina State Credit Union Regulator can resolve their differences regarding disclosure of a credit union's CAMEL rating and the use of dual exams.

The move came after the Raleigh, N.C.-based State Employees' CU got authorization from its state regulator and disclosed its state-issued CAMEL score (News Now Jan. 31).

The NCUA has disputed the disclosure of the credit union's CAMEL rating, for several reasons, including the fact that the state provides the rating to the NCUA which treats it as confidential information. The NCUA has discontinued its coordinated examinations with the state regulator, opting instead to begin separate exams for state-chartered federally insured credit unions in the state, over the next four weeks. In other states, the NCUA routinely conducts joint safety and soundness examinations with the state regulator.

"More than 70 people attended the meeting Wednesday to share their concerns and to ask questions of the state regulator, who was present at the meeting," John Radebaugh, league president/CEO, told News Now. "This meeting was a healthy exchange of ideas and part of the continuing process of gathering information."

The league also has talked extensively with NCUA officials.

"The solution to this situation clearly rests with both the North Carolina Credit Union Division and the NCUA," Radebaugh said. "The league will continue to work with state-chartered credit unions in the meantime to assist them through an unacceptable situation that they did nothing to cause."

The CAMEL rating system is NCUA's method of evaluating the health of credit unions. The rating, adopted by the NCUA in 1987, is based upon five critical elements of a credit union's operations: (C) Capital, (A) Asset quality, (M) Management, (E) Earnings and (L) Asset liability management.

North Carolina credit unions are well capitalized and among the healthiest credit unions in the country, said the league. As NCUA stated, the action is not the result of any safety and

soundness concern about state-chartered credit unions in North Carolina, the league added.

Because the regulatory burden on credit unions is at an all-time high, North Carolina credit unions need state and federal regulators working together to protect credit unions and their members, Radebaugh told News Now last week. Conducting dual examinations "on safe, sound, and healthy credit unions does nothing more than add to the regulatory burden and ultimately distract credit unions from focusing on serving and meeting the needs of their members," he added.

Maine Young and Free program introduces winter musical promotion

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PORTLAND, Maine (2/7/12)--Young & Free Maine has introduced a special winter promotion through a Sound Off Music Com­petition for Maine musicians ages 18-25.

The competition will be held Feb. 1 to March 5. The contest will be open to individuals, groups or artists, said the Maine Credit Union League (Weekly Update Feb. 3).

"This competition provides a new way for Maine's credit unions to connect with the state's young adults, while giving young musi­cians a unique platform to share their talent," said John Murphy, league president/CEO. "Through Young & Free Maine, and our spokesman Seth Poplaski, we've been able to hear the voice of this generation, so we can bet­ter serve them. This competition is another way we can recognize all that Gen Y in Maine has to offer, while bringing attention to our Young & Free program and driving website traffic."

Sound Off entrants must be between 18-25 years of age--in the case of bands, at least one member must be ages 18-25--and must not be under a recording contract. Entrants will submit an audio or video recording of themselves singing or performing original music to a special page on the Young & Free Maine website.

From March 7-16, the public will vote to choose a winner. The winning band or individual will receive a $1,000 gift certificate to a studio to be used for a recording session of their choice, and the opportunity to perform live at a festival, Aug. 4-9. The winner will be announced on YoungFreeMaine.com March 19.

"Maine has an ex­citing music scene that continues to grow and evolve," said Seth Poplaski, Maine's Young & Free spokesman. "I know that 'Sound Off' will really let these musicians shine, and offers an opportunity that is very unique--with a prize of both stage and studio time."

Mid-Atlantic Corporate and VACORP complete merger

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MIDDLETOWN, Pa. (2/7/12)--Mid-Atlantic Corporate FCU in Middletown, Pa., and VACORP FCU, Lynchburg, Va., completed their merger and opened as a combined institution Monday.

Mid-Atlantic Corporate is the continuing charter and is maintaining its current location in Middletown, Pa.

Mid-Atlantic said that the merger, combining more than 800 credit union members and over $163 million in capital, creates one of the strongest corporates in the country.

"This merger exemplifies the power of credit unions working together for a common good and demonstrates the value of the cooperative corporate model that credit unions built," said Jay Murray, president/CEO of Mid-Atlantic Corporate. 

The combined entity has total assets of $4.1 billion. Its capital ratios are:

  • Retained earnings ratio of 0.49%;
  • Leverage ratio of 5.4%;
  • Tier 1 risk-weighted capital ratio of 19%; and
  • Total risk-weighted capital ratio of 22%.
"The combined institution will give us the opportunity to grow the usage of our products and services, which will help keep costs down for all members," Murray said.