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CU System Archive

CU System

CUs growth rates and MBLs are media topics

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MADISON, Wis. (3/26/10)--Credit unions got several ringing endorsements this week in the media, which featured articles about growth, member business loans, credit card rates, benefits of credit unions and more. In Everyday Cheapskate ( March 25), an e-mailed newsletter from personal finance expert Mary Hunt, Hunt is asked, "Which do you believe is better for regular, everyday banking and savings: a standard bank or a credit union?" Her answer: "I am a huge fan of credit unions. The only difference between a bank and a credit union is who owns it." Hunt explains credit unions' structure and philosophy and notes their lower fees, better rates, and customer-friendly service. "Credit unions are as safe as banks, but a whole lot better in my opinion, because they operate for the benefit of the account holders." Other articles:
* In North Carolina, the state's credit unions have joined the nationwide push to raise the member business lending cap to 25% of assets from 12.25%.. North Carolina Credit Union League's Dan Schline explains why in "The business of borrowing" (jdnews.com March 25). Two small business members with loans at Marine FCU explain why they support giving credit unions the ability to help more businesses through the economy. Use the link for the full story. * In Sioux Falls, S.D., KSFY.com's story, "The Big Difference in Credit Cards," notes credit union credit cards are "an option that might save you a few bucks." Sioux Falls FCU President Fran Sommerfeld explains "we haven't raised our rates, we haven't cut any credit limits, we haven't added any new fees," and member Marya Leber tells why she switched to a credit union credit card. Use the link. * A letter to the Chicago Daily Herald notes that "Credit unions have benefits over banks." The letter, from Jim Peterson of Hoffman Estates, says he belongs to three credit unions because "they (unlike banks) care about customer service, they don't rip you off and your money is safer in a credit union." He advises, "If you want to fire your bank, ask at any local credit union how to search for one you can join." Use the link. * Bob Marquette, president/CEO of Members 1st FCU, Mechanicsburg, Pa., was featured on Harrisburg’s abc27. “In a year when financial institutions got a public relations black eye, Members 1st satisfaction surveys went up. More than 98% approve,” he said. Use the "Local Banker Smashes Stereotypes" link. * In a profile of the career of Jim Ritter, CEO of Valley 1st Community FCU and former consultant with the Pennsylvania Credit Union Association for 18 years, Ritter said working at the credit union gives him a chance to create a better life for the members (Valley Independent March 24).

TMG client CUs eliminate overlimit card fees

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DES MOINES, Iowa (3/26/10)--Card portfolio managers at 95% of TMG's card-issuing credit unions have discontinued the authorization of overlimit credit card transactions, says TMG. TMG, a wholly owned subsidiary of the Affiliates Management Co. owned by Iowa credit unions and their members, said the other 5% of clients continuing to allow overlimit authorizations will do so without assessing a fee. TMG attributed the trend to proposed rules in the final portion of the Credit Card Responsibility, Accountability and Disclosure (CARD) Act. The rules would permit assessment of overlimit fees only on cardholders who agree to the fees. The proposal would become effective Aug. 22. "There's no doubt that some cardholders will miss the ability to spend over their limits," said Sara Petty, TMG vice president of strategic initiatives. "However, removing the temptation to overspend really makes sense for credit unions as they lead the country's efforts to return to thrift and financial responsibility," Petty added. Citing opt-in program costs among the reasons for eliminating the overlimit authorizations, TMG clients predict several challenges in the maintenance of two cardholder groups--those opting in and those opting out of overlimit fees. "To complicate matters, the two groups would be in constant flux, as cardholders maintain the ability to change their minds," Petty added. "If, for instance, a cardholder has opted in, he has the right to opt-out each time he receives a statement containing an overlimit fee." Also, credit unions offering fee-based overlimit services have been asked to present their fee models to the Federal Reserve Board in order to weigh in on the Fed's final rules regarding the reasonability of fees. "The complexities of defendable fee calculations make fee-based opt-in program compliance insurmountable for many card-issuing credit unions," Petty said. TMG's experiences mirrors the Credit Union National Association's (CUNA) belief that many credit unions will chose to either disallow the service or pay overlimit transactions without charging a fee, since the CARD Act requires the member to opt-in before such a fee can be charged. The burdens of doing so will not likely be worth the additional fees that may be collected, said CUNA.

CUs applaud N.Y. Senate support for deposits

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ALBANY, N.Y. (3/26/10)--The New York state Senate this week passed a budget resolution including support for municipal deposit choice--a move the Credit Union Association of New York (CUANY) applauds. The Senate joins Gov. David Paterson, New York City Mayor Michael Bloomberg, and local elected officials statewide in support of the measure. It allows local government entities such as cities, towns, counties, public schools, fire districts and public libraries the option of depositing public funds in local credit unions or community savings institutions. CUANY now asks the state Assembly to join the Senate and governor in passing a “win-win” for state and local governments, and local communities and taxpayers. “Municipal deposit choice allows public funds to stay local, allows for more reinvestment in our communities, helps local governments increase revenue, and creates much-needed savings for New York taxpayers,” said William J. Mellin, CUANY president/CEO. “In short, municipal deposit choice puts more public dollars back on Main Street.” While a majority of states allow municipal deposit choice, and the Federal Credit Union Act explicitly authorizes federal credit unions to accept local government deposits, commercial banks in New York State currently hold a monopoly on such deposits. “In recent months, a variety of publications and organizations have been urging consumers to ditch their ‘big banks’ in favor of credit unions or community banks,” said Mellin. “This broad support and shift from Wall Street to Main Street, confirms that the local credit unions’ member-owner operating model works, and I’m confident that New York’s local government entities, like more and more consumers and localities in other states, will soon be jumping on the credit union bandwagon as long as they are given the freedom to do so.” Credit unions have the potential to help state and local officials in a way that doesn’t cost state or local taxpayers anything, but instead will save them money and increase the range of available financial options local governments desperately need, CUANY said. Allowing credit unions to accept municipal deposits will only strengthen the communities they serve by offering competition and an alternative to commercial banks, said the association.

CUs help youth get in the savings game

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MADISON, Wis. (3/26/10)--April is National Financial Literacy Month and nearly 300 credit unions to date have registered to celebrate with a savings challenge for youth sponsored by the Credit Union National Association (CUNA). The seventh annual National Youth Saving Challenge teaches youth under age 18 the importance of starting--and maintaining--a life-long savings habit. This year’s theme is “get in the saving game” and uses sports to illustrate the concept of saving for future wants and needs. The Saving Challenge is run in conjunction with National Credit Union Week, officially recognized April 18-24, although credit unions celebrate it throughout the month. “There are no losers in this game,” says Lin Standke, manager of product training in CUNA’s Center for Personal Finance. “Youth win financial smarts. Credit unions win as their trusted financial advisor. And the publicity we get for credit unions is, well, something banks can’t buy.” In the savings challenge, credit unions are offering prizes for young people under age 18 who make deposits. Prizes include giveaways and gift certificates with a sports theme. Some credit unions are supporting schools in their communities with donation jars for contributions to sports programs. Others are collecting new and used sports equipment for Special Olympics. Lobbies will be decorated with team pennants, sports equipment, and pictures of local athletes. Branches will host engaging activities such as basketball dunks, putting practice, and coloring contests to make visiting the credit union fun and memorable for young members. Family events range from a bowling night to carnivals in the parking lot. “Credit union employees are getting in the game by wearing specially designed savings game jerseys or local team uniforms,” Standke noted. CUNA will award 10 prizes of $100 nationwide in early May to young members participating in the Saving Challenge. Last year, credit unions posted a record Saving Challenge score when nearly 140,000 young members deposited $26.5 million into their savings accounts. And 10,006 of these were new accounts.

Ohio league announces 2010 state awards

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COLUMBUS, Ohio (3/26/10)--The Ohio Credit Union League has presented its Leadership Recognition Awards for 2010. The awards are given to recognize leadership, political action, youth financial education, social responsibility, philosophy and marketing. The awards included (eLumination Newsletter March 24):
* Louise McCarren Herring Lifetime Achievement Award--Claude Clarke, who wrote the Ohio Credit Union Act and was the first part-time manager of the league; * Volunteer of the Year--Jerry Gramke, board chair of Cincinnati Police FCU; * Professional of the Year--Bill Burke, CEO of Day Air CU, Kettering; * Claude Clarke Political Inspiration Award for an individual and credit union--Phil Buell, CEO of Superior FCU, Lima, and Seven Seventeen CU, Warren; * Desjardins Youth Financial Education Award for leadership on behalf of youth financial education--Unity Catholic FCU, Parma, and Day Air CU; * Dora Maxwell Social Responsibility Award for campaigns to assist local residents and organizations--Community Star CU, Elyria; Directions CU, Sylvania; and the Central Ohio Chapter; * Louise Herring Award for Philosophy in Action for extraordinary practical applications of the People Helping People philosophy--Toledo (Ohio) Police FCU and Wright-Patt CU, Fairborn; and * Cutting Edge Marketing Brilliance Award for agency and non-agency entries: Members First CU, Columbus, and Wright-Patt CU.
The winners will be honored at the Ohio Credit Union League ZENITH10, April 15-16 in Cincinnati. To see the winning award entries, use the link.

CU System briefs (03/25/2010)

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* BRATTLEBORO, Vt. (3/26/10)--Gary Ellis, former president/CEO of River Valley CU, was sentenced Wednesday to six months in prison after pleading guilty to embezzlement from the Brattleboro, Vt.-based credit union. Chief U.S. District Judge William K. Sessions III also ordered Ellis, 57, of Newmarket, N.H., to serve five years of supervised release after the prison term, including an additional four months of home confinement, and ordered him to pay restitution of $120,000 to $200,000. A hearing later will determine the exact amount. Ellis was CEO until spring 2005. His Dec. 3, 2008, indictment said he took extra salary, bonuses and other payments from about January 2001 through early 2005, said the U.S. Attorney’s Office for the District of Vermont (Targeted News Service March 24) ... * TRENTON, N.J. (3/26/10)—New Jersey’s Senate has confirmed Tom Considine, a former Metlife vice president and government relations counsel, to head the state’s Department of Banking and Insurance. He has served as acting commissioner since late January, said the New Jersey Credit Union League (The Daily Exchange March 25). Also, Gov. Chris Christie this week nominated Garret Komjathy, a corporate finance professional most recently from the media sector, as director of the Division of Banking. His experience includes capital markets, cash management and treasury products at GE Commercial Finance, Fleet Bank and HSBC, said the league ...

42 charged in Fla. fraud ring targeted CUs

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ORLANDO, Fla. (3/26/10)--Florida law enforcement authorities are looking for the ringleader of a fraud and identity theft ring involving 42 people who stole more than $200,000 from five Orlando area credit unions over three years. Authorities made 21 arrests in "Operation Long Hair" and charged the suspects with various frauds, said the Florida Department of Law Enforcement (FDLE). Twenty-one others--including accused ringleader Vanessa Rideau--are still at large (Orlando Sentinel and ABCActionNews.com March 24). Rideau, 41, allegedly recruited people to open accounts at a local credit union. When the recruits received their ATM cards, they would sell the cards and personal identification numbers to her for a fee. Then Rideau would deposit a fraudulent check or empty envelope into the account via an ATM--and immediately withdraw cash. Later, the check didn't clear and the credit union would contact the account holder, who would say the card had been stolen. Rideau is accused of making more than 40 transactions at the credit unions, said FDLE. The investigation began when one credit union complained to the agency about suspicious ATM transactions. The frauds occurred from 2005 to 2008 and targeted these credit unions: Insight FCU, Martin FCU, Central Florida Educators CU, McCoy FCU, and Fairwinds FCU. According to ABC Action News, many of the suspects are also suspects in a food stamp fraud.

2010 Diamond Award winners named

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MADISON, Wis. (3/26/10)--Co-op Services CU, Livonia, Mich., was named “Competition’s Best”--the highest “Best of Show” award in the CUNA Marketing and Business Development Council’s Diamond Awards competition. The winners were acknowledged during the council’s 17th annual conference, which ended Thursday in Washington, D.C. Entered in the Complete Campaign category, Co-op Services sought to inspire people to give back to the community by randomly offering individuals $100 over 100 days to increase brand exposure and new members. The campaign netted 1.7 million non-paid media impressions throughout the Detroit-area media market. This year’s awards competition received nearly 1,000 entries. Judges awarded four entries as Best of Show, along with 165 Diamond Awards and 188 Awards of Merit. Other Best of Show honorees included:
* Best Association Entry: Richmond Chapter and Southside Chapters of the Virginia Credit Union League, Richmond, Va., for its league marketing campaign, “What If Credit Unions,” which aimed to educate locals about the credit union alternative and seize the opportunity created by the current economic environment. * Best Use of Art: Dupaco Community CU, Dubuque, Iowa, for its “Sycamore Street Experience” entry in the Retail Merchandising category. The “Sycamore Street Experience” branch tribute was a way to educate members on the history and uniqueness of the credit union and preserve the memories of the Dubuque Packing Company for area residents. * Best Use of Humor: Directions CU, Sylvania, Ohio, for its “Life is Easier with Directions” television spots. Through a series of TV ads, Directions emphasized that the credit union is there for its members during different life stages. The spots helped increase membership by 5,526 members and name awareness by 37%.
The Diamond Awards, representing the pinnacle of credit union marketing and business development, feature 34 categories, ranging from direct mail and website marketing to public relations and political action. Judges evaluated entries based on strategy, design and production, creative concept, copy and communication, and results. For a complete list of award winners, use the link.

Illinois kicks off third year of REAL Solutions

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NAPERVILLE, Ill. (3/26/10)--Illinois credit unions started their third year participating in REAL Solutions with a meeting that addressed topics centered on membership growth, said the Illinois Credit Union league (ICUL). Topics included:
Click to view larger image Wednesday Medlen, business development officer from Community Plus FCU, Rantoul, Ill., discussed her credit union’s involvement in Volunteer Income Tax Assistance and Money Smart Week efforts as an outcome of its participation in REAL Solutions during an Illinois Credit Union League meeting this week in Naperville. (Photo provided by the Illinois Credit Union League)
* Student Interns: Representatives from Robert Morris University discussed the opportunity for credit unions to engage student interns--paid and unpaid positions--to help with special projects, such as marketing and business development projects. * Financial Education and Girl Scouts: The Girl Scouts of Greater Chicago and Northwest Indiana discussed the volunteer opportunities for credit unions to help teach financial education programs to girl scouts. They highlighted Journey World--an experiential, hands-on environment to immerse students in a new way of learning. * Financial Education--CU4 Reality: Scott CU, Collinsville, shared the credit union’s experience implementing the CU4 Reality program--also known as a “reality fair” or a “reality store”--for 200 high school seniors. Materials were developed by America’s Credit Union Museum. Scott CU is adapting the program to reach middle school students, high school students and newly enlisted military members. * Financial Education--Money Smart Week: The Federal Reserve Bank of Chicago hosts Money Smart Week (MSW) in seven areas of Illinois during April of each year. MSW is a public awareness campaign to help consumers better manage their personal finances. Businesses, financial institutions, schools, libraries, not-for-profits, government agencies and the media come together to stress the importance of financial literacy. These groups provide free educational seminars and activities throughout MSW.
Field coach Mark Lynch also provided an update regarding REAL Solutions activities nationwide. The next meeting for Illinois REAL Solutions partner credit unions will be held June 9 at the ICUL offices in Naperville. Also, other scheduled Illinois REAL Solutions gatherings include two education sessions, including one on Mad City Money, as part of ICUL’s 80th Annual Convention April 29 through May 1 in Chicago. “The topic of reality fairs is very timely for us, given we are looking to expand our efforts with local high schools,” said Tom Pierce, CEO of Canals & Trails CU, Lockport. “We have been very happy with REAL Solutions, as it has provided help to implement our payday loan alternative program, as well as to explore youth marketing and providing income tax assistance.” ICUL and the Illinois Credit Union Foundation have teamed up with the National Credit Union Foundation to offer the “REAL Solutions for Low Wealth Households” program in Illinois. Currently, 48 credit unions in the state participate. REAL stands for Relevant, Effective, Asset-building, Loyalty-producing, and is being operated in 27 states nationwide.