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U of Iowa Community CU to match flood funds

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IOWA CITY, Iowa (6/20/08)--University of Iowa Community CU will conduct fundraisers and collect contributions for victims of flooding in the Iowa City/Coralville area and it will match some of the funds raised. The credit union's board met Tuesday to brainstorm ways the credit union could help the community and its members in the wake of last week's flooding in the state. Credit union staff will raise money through a variety of fundraisers such as car washes, hot dog lunches and bake sales at its branches. Donations also will be accepted from the public. The credit union will match the funds raised up to $5,000, it said in a press release Tuesday. The funds will be directed to the Iowa City/Coralville Flood Relief Fund through the United Way of Johnson County. The credit union closed one branch, located in the university's Student Memorial Union, when the university campus was flooded last week. Officials estimated that the branch had three feet of water (News Now June 17). "In the aftermath of flooding in the Iowa City/Coralville area, we're pleased to be able to help those affected as it fits in well with the credit union philosophy of 'people helping people,'" said Jeff Disterhoft, president/CEO of the $619.2 million asset credit union.

California league warns of vishing scam

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RANCHO CUCAMONGA, Calif. (6/20/08)--Credit unions and their members were being warned about a vishing scam making the rounds in San Jose and the Bay Area, according to a local journal. The California Credit Union League warned that the new scam involves a telephone message indicating that the call is from "your credit union" and that the recipient's account number or credit card number has been used illegally (Silicon Valley/San Jose Business Journal June 18). The vishing telephone call asks the victim to call a fake 800 number to "verify" information such as account number, security code, Social Security number and place of birth and reinstate the account. Credit unions in the area received reports from members and non-members about the recorded calls and have posted information on their websites to educate members about the scam, said the newspaper. The league reminded credit unions that they should continually educate members about scam with tips such as these:
* Don't call the number provided in a phone call or voice message. Instead, call the number on the back of the credit card or on a billing statement. * If the caller poses as a financial institution and asks for a credit card number or the three-digit code on the back of the card, hang up and call the phone number on the back of the card to report the attempt. * Be cautious when dialing a call return number or replying to an e-mail about a financial matter. * Credit card companies normally refer to customers by their full name in any communication. An e-mail or telephone call that doesn't use a full name may be a scam.

CU attendees told to develop ID theft prevention

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HOLLYWOOD, Fla. (6/20/08)--Credit unions should develop ID theft prevention measures based on their own ID theft situation, conference attendees were told Thursday at CUNA Mutual Group's Discovery Conference, meeting this week in Hollywood, Fla.
CUNA Mutual Risk Manager Ken Otsuka and National Association of State Credit Union Supervisors (NASCUS) Vice President Jenny Champagne discussed new identity theft "red flag" rules with Discovery Conference attendees Thursday. (Photo provided by CUNA Mutual Group)
Ken Otsuka, risk manager at CUNA Mutual, and Jenny Champagne, vice president of regulatory development and education at the National Association of State Credit Union Supervisors, outlined new identity theft "red flag" rules required by the Federal Trade Commission and other fed agencies by Nov. 1. They noted that proper implementation of sections 114 and 315 of the Fair and Accurate Credit Transactions Act of 2003 (FACT Act) will help protect credit unions and their members against identity theft. A successful ID theft prevention program will help credit unions mitigate reputation risk--a key aspect of examinations. “Regulators are also paying attention to due diligence, so a regular review of your ID theft program should include assessments of third-party service providers,” said Champagne. The FACT Act was signed into law in December of 2003. Its provisions giving consumers the right to receive a free credit report from the three major credit bureaus; requiring truncation of credit and debit card numbers on receipts; and providing ID theft victims the ability to place a fraud alert on their credit report. Section 114 requires credit unions to develop a written Identity Theft Prevention Program to detect, prevent, and mitigate identity theft related to new or existing covered accounts, Champagne said. “Covered accounts include business and consumer accounts such as credit cards, mortgage loans, automobile loans, margin accounts, cell phone accounts, utility accounts, checking accounts, and savings accounts,” she said. The prevention program must be approved by the credit union’s board and include policies and procedures that detect red flags and help answer the questions, "Who will be responsible for detecting red flags?" and "How will they detect the red flags?" Five categories of red flags include:
* Alerts, notifications, or warnings from a consumer reporting agency; * Suspicious documents; * Suspicious personal identifying information; * Unusual use of, or suspicious activity related to, the covered account; and * Notice from customers, victims of ID theft, law enforcement authorities, or other persons about possible ID theft connected to covered accounts.
Credit unions should be capable of responding appropriately to any red flags and should update their procedures periodically to reflect changes in risks from identity theft, Otsuka said. He cautioned there is not a one-size-fits-all solution. “The program must be tailored to the size of the credit union and the complexity of its operation. The credit union must also ensure oversight in the development, implementation and administration of the program, staff training and overseeing service provider arrangements.” Otsuka suggested forming a risk assessment team that would review all operational areas to identify the types of red flags that could surface in each area such as new accounts, loans or call centers. “A credit union should factor in its own experience with ID theft losses and consider credit union industry losses to the degree possible.” Staff training is critical. “It’s important for staff to first understand the various forms of identity theft, how they are perpetrated and the red flags that are raised within each type. If they understand the nature of the losses themselves, it will be easier for them to spot red flags,” he said.

Reach Out Set for October conference

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MADISON, Wis. (6/20/08)--Credit union professionals can learn how to serve low-wealth individuals, immigrants and youth during the “Reach Out! Conference: Strategies for Serving Low-Wealth, Immigrants, and Youth” Oct. 12-15 in San Francisco. The conference is presented by the Credit Union National Association (CUNA) and the National Credit Union Foundation (NCUF). The conference will provide information about the three target groups, including demographics, financial services needs, challenges and best practice ideas for reaching them. Experts from NCUF, CUNA, the Filene Research Institute and the National Federation of Community Development Credit Unions will offer advice on serving the markets. Credit union professionals also will learn how to respond to the potential business threat presented by Wal-Mart stores entering the financial services arena. Wal-Mart’s technology to offer products and services to low-wage families will be discussed. Attendees will learn about NCUF’s REAL Solutions program. The latest information from the REAL Solutions Impact Center will be provided. For more information, use the link.

Maxwell Herring awards named by Florida league

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ORLANDO, Fla. (6/20/08)--Winners of Florida’s 2008 statewide competition for the Dora Maxwell Award for Social Responsibility, and the Louise Herring Award for Philosophy in action were recognized at the 74th Annual Florida Credit Union League Convention and Expo held in Orlando June 11-14. First-place Dora Maxwell Social Responsibility awards went to:
* Gold Coast FCU, West Palm Beach ($50 million to $100 million assets); * PBC CU, West Palm Beach ($100 million to $200 million); * Insight Financial CU, Orlando ($200 million to $500 million); and * Pen Air FCU, Pensacola ($500 million and above assets).
First-place Louise Herring Philosophy in Action Awards went to:
* Gold Coast FCU; and * FAIRWINDS CU, Orlando ($250 million or more assets).
Each of the first-place winners will advance to their national competitions where the Credit Union National Association will select the national award winners.

Speaker Ignore boomers needs and CUs relevance erodes

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HOLLYWOOD, Fla. (6/20/08)--To stay relevant, credit unions should care about and prepare for the surge of baby boomers converging on retirement, attendees of CUNA Mutual Group’s Discovery Conference were told Thursday.
Scott Knapp, CUNA Mutual Group’s vice president, retirement services and strategy, speaks about baby boomers’ retirement needs to Discovery Conference attendees Thursday in Hollywood, Fla. (Photo provided by CUNA Mutual Group)
“To not have a strategy for the largest generation in U.S. history will lead to erosion of a credit union’s relevance and economic viability,” said Scott Knapp, vice president, retirement services and strategy, CUNA Mutual. “This is a matter of importance that should be addressed at the highest level of the credit union.” Members nearing retirement are “scared to death” about not having enough money during retirement and that society has “over committed” to baby boomer retirement and won’t be able to deliver on many benefits, Knapp told Discovery Conference attendees. In a Gallup poll, 63% of baby boomers said they were concerned about not having enough money for retirement, and more than half were worried about not being able to pay for medical costs. The majority of people are not saving the right amount for retirement, he added. “That’s the easiest part of preparing for retirement, but few are getting it right. The hardest part is converting that accumulation of assets in order to sustain your retirement years. Building that plan is hard,” Knapp said. Credit unions need to step up and help members against some of the major retirement risks, including how to avoid outliving their money, taking out too much, needing money for health care and protecting against inflation, Knapp said. “Credit unions of all sizes need to play some role in helping those members through the difficult part. Position your credit union as a retirement resource center, providing investment, insurance and other services that address the retirement risk and management challenges,” Knapp said. “Adopt a comprehensive retirement strategy, communicate it to employees and train them to help members address their retirement needs,” he continued. “Partnering with a vendor to offer a product menu during your members’ pre-retirement years is a good way to address these challenges ahead of time.” Credit unions can grow membership by offering retirement planning services to their select employee groups (SEGs) before employees’ retirement, Knapp said. He also recommended offering 401(k) programs to those employers as a way to establish a long-term, sustainable relationship with the SEG. “A strategy to address your members’ retirement needs is crucial, or at retirement they will walk out of your branches forever,” Knapp said. “This is an issue that affects your capital investment strategy, marketing, distribution--and essentially the future of your credit union.”

Fla. Ala. leagues discuss combining collaborating

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TALLAHASSEE, Fla. (6/20/08)--The Florida and Alabama Credit Union Leagues have entered into early discussions to explore a combination of or closer collaboration between the two leagues. The announcement Thursday was made by Florida league Chairman Rich Helber and Steve Swofford, chairman of the Alabama league. The discussions aim to bring greater level of services to both states' credit unions and to create efficiencies and greater strength. "Each league enters these discussions with an open mind about the potential resulting structure that would best serve credit unions in their states," said a press release. The discussions are linked to the retirements of the leagues' long-time league presidents Alabama's Gary Wolter and Florida's Guy Hood. With their upcoming retirements, leadership in each state believes that a great opportunity exists to build on the successes each state and deliver services and gain efficiencies through some form of combination, said the press release. Swofford and Helber stressed that the discussions are in the "very early phases" and a "thorough analysis" will be made. The leagues have a history of working together. They have retained Tom Olson, president, Directions 21 Business Group, to assist them.

Ohio governor signs CU modernization act

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COLUMBUS, Ohio (6/20/08)--Ohio Governor Ted Strickland signed a credit union modernization bill into law on June 11, according to the Ohio Credit Union League (OCUL). Senate Bill 247 updates regulations regarding state credit union operations, administration and governance. It will take effect Sept. 9 (eLumination Newsletter June 18). Under the new law, written ballot approval will no longer be required when a ballot is necessary, within guidelines. It also provides for record retention time periods and additional flexibility in credit union mergers. The law adds language similar to that of the federal law requiring criminal background checks for people with a substantial interest in or who participate in the management of a financial institution when there is a newer application, change in control, or supervisory action. It also reviews appointments based on asset size for the Ohio Credit Union Council with a member of a credit union less than $35 million and $50 million. League General Counsel John Koslowski told the newsletter that the league was pleased by the measure's bi-partisan support in the state legislature and by "the increased flexibility and ability credit unions will have to operate more efficiently so they can focus on serving their members."

Two indicted in CU shootout that killed third suspect

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NILES, Mich. (6/20/08)--Two men have been indicted in connection with an armed robbery and shootout Jan. 18 at the Niles, Mich., branch of Berrien Teachers CU. A third suspect died in surgery after the shooting. A federal grand jury in Grand Rapids, Mich., indicted Glen Porter and Travis Curry on charges of conspiring to commit armed robbery, attempted armed robbery, and brandishing and discharging firearms during the robbery attempt (WSBT2 June 19). Both could receive a maximum sentence of life in prison. Devarence Kimbrough, a third accused robber, was shot twice and died Jan. 18 in surgery. Curry allegedly waited in the car during the robbery, while Kimbrough and Porter entered the credit union with guns drawn, said U.S. Attorney Charles R. Gross. A shootout with a security guard wounded Porter in the buttocks. Kimbrough was shot twice in the chest and upper body, Gross said. Outside the credit union, the shootout continued with Kimbrough firing at the guard pursuing him. Curry allegedly picked up Porter and Kimbrough, then drove Kimbrough to a Hospital in South Bend, Ind., where he died. Berrien Teachers CU, based in St. Joseph, Mich., has $219 million in assets.

New Mexico CUs honor three colleagues

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ALBUQUERQUE, N.M. (6/20/08)--The Credit Union Association of New Mexico honored three credit union representatives for their service and presented them awards at the association’s annual convention June 6. Harold Dixon, CEO, State Employees CU, Sante Fe, received the Mel Romero Outstanding Professional Award in recognition of his years of leadership and dedication. Under his tenure, deposits grew at State Employees to $177.2 million from $79.1 million, assets to $197 million from $89 million, and membership to 29,556 from 21,586 in five years. Dixon also serves as treasurer on the CUANM board of directors. Burton Clyde, chairman of the board of directors at Sandia Area FCU, Albuquerque, was given the Ed Twibell Outstanding Volunteer Award. Clyde held the position as board chairman for 13 years, leading the credit union through the unexpected death of its CEO in 2005, tripling the membership, and keeping pace with changes in financial services and its technology. Susan Clem, manager of The Florist FCU in Roswell, was named to the Ron Moore Hall of Fame after an unprecedented number of nominations. She started her career in 1975 and has been manager for 23 years. She contributed to her credit union’s growth and stability by staying updated on new products, services and technology, and traveling extensively to provide service to members spread over a large geographical area.