Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive
150x172_CUEffect.jpg
Contacts
LISA MCCUEVICE PRESIDENT OF COMMUNICATIONS
EDITOR-IN-CHIEF
MICHELLE WILLITSManaging Editor
RON JOOSSASSISTANT EDITOR
ALEX MCVEIGHSTAFF NEWSWRITER
TOM SAKASHSTAFF NEWSWRITER

CU System Archive

CU System

CU System briefs (05/21/2010)

 Permanent link
* CENTRALIA, Wash. (5/24/10)--A man who held a credit union employee hostage and was shot by a police officer responding to the emergency call pleaded not guilty last week on new charges of unlawful imprisonment, robbery and burglary related to the incident. A jury in April already had found Michael Anthony Lar, 57, guilty of holding an employee of Centralia TwinStar CU hostage during a January robbery. The woman was saved when the officer pulled her from the building after she mouthed to him that the robber had a gun. The officer fired two shots, injuring Lar, who escaped while police believed he was still in the building. He is scheduled to be sentenced Wednesday on the original conviction (The Olympian May 21) ... * WASHINGTON (5/24/10)--The hotel discount deadline has been extended to Tuesday for the 36th Annual Conference on Serving the Underserved and the 6th Latino Credit Union Conference, to be held in Pittsburgh, Pa., on June 9-12, according to the National Federation of Community Development Credit Unions. For more information on the conference, use the link ...

Fraud forced Cardtronics to shut down 1000 ATMs

 Permanent link
NEW YORK (5/24/10)--ATM provider Cardtronics Inc. was forced to temporarily shut down more than 1,000 ATMs owned by companies and merchants earlier this year when owners of its armored-car service were charged with fraud. Cardtronics, which owns and operates more than 28,000 ATMs in the U.S., shut down nearly 4% of its ATMs after the owners of Mount Vernon (N.Y.) Money Center Corp. were arrested Feb. 8, according to Cardtronics' filing with the Securities and Exchange Commission (ATM & Debit News May 19). Arrested were Money Center Corp. President Robert Egan, 64, and Chief Operating Officer Bernard McGarry, 50. Their company supplied cash to more than 5,300 ATMs, including those of Cardtronics. The two men were indicted for allegedly defrauding banks, other financial institutions, retailers, hospitals and universities out of $50 million. Instead of segregating cash for each of their clients, they allegedly commingled funds by taking whatever cash that arrived in the vault, regardless of its source, to fill the next day's ATMs, according to the indictment. The company had to convert the ATMs to another third-party armored-service provider, which resulted in downtime at the machines. Cardtronics estimates it lost $16.2 million from the vault. Money Center has been put into receivership.

Utah mortgage broker charged with construction loan fraud

 Permanent link
SALT LAKE CITY (5/24/10)--A federal grand jury returned a 15-count indictment against a Salt Lake City man on charges of bank fraud and making false statements to two credit unions in an alleged scheme to get construction loans approved under false pretenses. The indictment alleges Joshua Lee Butcher, 28, worked with two credit unions--Salt Lake CU and Transwest CU--to broker new home construction loans ranging from about $384,000 to $637,000 (loansafe.org May 21). He is charged with providing false information about borrowers that caused the credit unions to approve and fund home construction loans. Butcher allegedly met with potential borrowers to obtain the financial information for the loan application, said the indictment. Borrowers provided him with accurate information--and sometimes documentation--about their income and assets. The indictment said Butcher knew the borrowers would not qualify for the loans so he prepared and submitted false loan applications on their behalf to induce approval for higher amounts. He received broker fees for the loans, said the court document. The falsified documents included: overstated income; listing of assets which the borrowers did not own; false employment information; applications for owner-occupied homes that the borrowers planned to use as investment homes; and indications that the construction loans were for primary residences of the borrowers when they weren't. The indictments include eight counts of bank fraud, with a maximum penalty per count of 20 years in prison and a $250,000 fine; and seven counts of making false statements, each having a maximum penalty of 30 years in prison and a $1 million fine.

Ohio youth deposited 4M in savings

 Permanent link
COLUMBUS, Ohio (5/24/10)--Ohio youth collectively saved more than $4 million through deposits at 20 Ohio credit unions during the 2010 National Youth Saving Challenge in April. The challenge is a nationwide effort to help young people understand the benefits of saving. Nearly 10,000 Ohioans age 17 or younger deposited more than $4.1 million into participating credit unions. The average deposit was $420, according to the Ohio Credit Union League. “The debt crisis in our country is one of many factors slowing economic growth,” said Paul Mercer, league president. “Helping young Ohioans see the benefits of savings allows up and coming consumers to be smart and savvy about their finances, while passing on knowledge and strong financial habits to future generations.” Statewide, credit unions opened 772 new accounts. Nationally, the number of youth savers increased nationwide by 21.6%, and new youth savings accounts rose by 4.4% from 2009, according to the Credit Union National Association (CUNA). Nearly 170,000 youth made deposits, opening 10,385 new accounts. In 2009, nearly 140,000 young members deposited $26.5 million into savings accounts during the national event, including 10,006 new accounts. The National Youth Saving Challenge is held in conjunction with the annual National Credit Union Youth Week, and is sponsored by CUNA.

Free International Year of Co-ops webinar is Wednesday

 Permanent link
Washington (5/24/10)--The National Cooperative Business Association’s (NCBA) International Year of Cooperatives 2012 webinar will be held Wednesday from 4 p.m. to 5 p.m. ET. The General Assembly of the United Nations (U.N.) declared 2012 as International Year of Cooperatives (IYC). The U.N. also drafted a framework that draws from the activities of the International Year of Microcredit, 2005 and other successful international years. While the U.N. is organizing among governments, each nation’s apex organization for cooperatives--such as NCBA--will coordinate national activities among cooperatives. NCBA has assembled a working group with participants from several cooperative sectors to provide overall guidance, and create a process through which many participants can discuss and organize events during the next two-and-a-half years. The webinar will outline that process and allow participants to provide input to build on the U.N. draft framework and to find ideas on how to make the IYC a success, and to avoid duplication and streamline activities. The U.N.’s resolution was supported by the World Council of Credit Unions (WOCCU). In May 2009, WOCCU CEO Pete Crear spoke at a U.N. meeting of global experts on “Cooperatives in a World in Crisis” (News Now May 6). “Declaring 2012 as the International Year of Cooperatives would shine a more intense light on cooperatives and credit unions worldwide,” Crear said. For more information, use the link.

BECU outlines CU difference for local paper

 Permanent link
TUKWILA, Wash. (5/24/10)--Gary Oakland, BECU president/CEO in Tukwila, Wash., shared the credit union difference Friday with a local newspaper, The News Tribune. In a question-and-answer format, Oakland talked about some of the things that separate credit unions from banks. First, credit unions are cooperatives and don’t have stockholders to pay. “We want members to see what value the co-op has that benefits them and their community,” he said. Service also sets credit unions apart. “There was a time when banks forgot about consumers, and when they came back, credit unions had a foothold,” he added. He also said BECU doesn’t have teller lines. “We don’t do transactions, we do conversations,” he said. “We have neighborhood financial centers.” BECU plans to open three to six financial centers per year and is planning growth in concentric circles. Business at the credit union is also good--it’s seeing a decline in write-offs and is well-capitalized, he said. BECU has $8.6 billion in assets.

Expect virtual currency to catch on--forum speaker

 Permanent link
PORTLAND, Ore. (5/24/10)--A man walks into a bar and orders a drink. The waitress says, “That will be $4.” The man pulls out his cell phone, and with a couple of clicks, pays his tab with credits from his frequent flyer account. That’s an example of virtual currency--an exchange of real money for credits. Its growing presence will be highlighted by Ron Galloway, who is slated to speak on the future of money at Southwest Corporate’s Economic Forum-West June 22 in Portland, Ore. “Other types of money are going to become more popular than currency,” said Galloway, a nationally recognized public speaker, business and technology writer for The Huffington Post and former investment adviser. “Money is a medium of exchange. And while the exchange will always take place, the medium will continue to evolve. “For example, rice, gold and even cigarettes during World War II once served as payment media, but they were replaced over time. With the financial problems that are occurring in Greece and the surrounding countries, the euro may be the next medium to disappear.” Virtual currency has driven revenue for game developers on social networking sites, such as Facebook. One analyst recently predicted in a Bloomberg Businessweek article that the sales of virtual goods would top $3.5 billion by 2012, said Galloway. “In the past, consumers have placed a great deal of faith in financial institutions, but some of that allegiance is now shifting to other institutions, including Facebook, Twitter and Google,” Galloway said. “The common thread is the combination of a distributor, such as Google or Wal-Mart, with information technology to create a virtual payments platform. “But the money flowing into these accounts has to come from somewhere, and many times it is from a credit union. For credit unions to keep those funds from leaving their institutions, they will have to stay abreast of what’s going on in the payment systems and when necessary, get involved,” he added. Credit unions already have the arsenal to keep member assets on their books--like knowing their members and providing service, he said.

Michigan league endorses Hoekstra for governor

 Permanent link
LANSING, Mich. (5/24/10)--The Michigan Credit Union League (MCUL) Friday announced its support for U.S. Rep. Pete Hoekstra’s (R-Mich.) bid for governor. Calling the endorsement a vote for small business and for consumers, MCUL President /CEO David Adams applauded Hoekstra’s track record and leadership. “Congressman Hoekstra has been a champion for small-business interests and for policies that help the consumer,” Adams said. “These values align with those of the credit union movement, which is built on local ownership and commitment to serving middle-class America. These values are what Michigan needs as it rebuilds its economic strength and strengthens the vital financial interests of its citizens.” Hoekstra called the credit union endorsement a momentum builder. “Credit unions are about as ‘mainstream America’ as you can get,” Hoekstra said. “The league’s endorsement shows confidence in my track record of strengthening Main Street by supporting locally owned credit unions and their 95 million members across the country. The diverse and bipartisan nature of credit unions makes them a great partner for my campaign.” The MCUL’s endorsement decision was based on the congressman’s positions and votes on legislation that allowed credit unions to expand their fields of membership and their ability to expand small-business lending. Hoekstra has served nine consecutive terms in the House of Representatives since winning his first election to the Congress from Michigan’s 2nd District in 1992. In the U.S. House, Hoekstra has served on committees, including Education and Labor, Budget, and the Permanent Select Committee on Intelligence. Credit unions’ structure has positioned them as the sole sector of the financial services industry that continued to lend during the recent financial crisis brought on by Wall Street abuses. In 2009, credit unions’ small-business lending in Michigan was up 18%, while banks decreased business lending, MCUL said. State credit union membership has been growing at a record pace, with 40,000 new members in 2009, as national and local media tout the strength of credit unions, their ability to continue lending and their favorable interest rates and lower fees, MCUL said.

MCUA Grassroots efforts on highway CUs caught legislators eye

 Permanent link
JEFFERSON CITY, Mo. (5/24/10)--Although Missouri credit unions did not succeed in keeping their highway credit unions’ offices at the Missouri Department of Transportation (MoDOT) facilities, their grassroots efforts on the issue caught state legislators’ attention, said the Missouri Credit Union Association (MCUA). On Jan. 21, MoDOT notified 10 credit unions located in MoDOT district offices statewide that they would be required to completely sever their relationship with MoDOT and move out of the facilities by Sept. 30 (The Missouri difference May 19). MCUA mounted a campaign to “undo” the action including lobbying the state legislature and the Missouri Highway Commission, informing the press and involving the state credit union regulator, the Division of Credit Unions. Although MCUA said it would have preferred a total reversal of MoDOT’s decision, it was able to get the move-out date extended to two years. State Rep. Mike Cunningham (R-District 145), chair of the House Financial Institutions Committee, introduced HCR 70, which would have allowed the credit unions to remain in MoDOT facilities indefinitely. The bill was voted out of the House 157 to 0. The highway department credit unions are to be credited with an outstanding response to the association’s call for grassroots contacts, MCUA said. One legislator, who has not been a credit union supporter in the past, told MCUA, “I have never seen an issue get legs like this so quickly.” And, the grassroots contacts remained strong throughout the session, the association said. Although the bill did not make it onto the Senate’s calendar, awareness of Missouri credit unions in the state Capitol, and the perception that MCUA can mobilize grassroots quickly and efficiently, was generated by the campaign, the association said.