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CU System briefs (07/29/2008)

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* WEST JORDAN, Utah (7/30/08)--A Utah man has been charged with making a bomb threat against a credit union and claiming a sniper was waiting across the street. The man, who wasn't identified, allegedly called Cyprus FCU, West Jordan, and threatened the bomb if he did not get $100,000. The call was traced to a pay phone, where an officer saw the man handle the phone and then drive away. He is charged with aggravated robbery and terroristic threat (The Salt Lake Tribune July 29) … * TYLER, Texas (7/30/08)--A bomb threat that stopped business for 90 minutes at four branches of Kelly Community FCU, was deemed a hoax after no explosive device was found. The incident occurred Friday at about 12:30 p.m. when a caller called the credit union's main number and said there was a bomb in the credit union. A search of the branches found no device at the Tyler, Texas-based credit union (TylerPaper.com July 29) … * KERMIT, Texas (7/30/08)--Winkler County CU President/CEO Devora Mitchell was appointed by Texas Gov. Rick Perry to the governing board of the Texas Department of Housing and Community Affairs' Manufactured Housing Division. The board sets policy for the division and addresses issues related to the manufactured housing industry. Mitchell is a member of the board of the Permian Chapter of Credit Unions and has served on numerous committees for the Texas Credit Union League. She replaces Valeri Stiers Malone. The appointment is subject to confirmation by the Texas Senate (US Fed News July 21) … * BREA, Calif. (7/30/08)--Evangelical Christian CU (ECCU) has revised its website, eccu.org, from a portal to find information to a relationship-based resource for ministries. The site aims to be members' "ministry banking resource" and includes white papers, resource events and case studies to support, educate and encourage ministries, the $1 billion asset credit union said … * HARRISBURG, Pa. (7/30/08)--Adam Gertler, a Philadelphia actor who appeared earlier this year in a television commercial for Bucks First FCU, Bristol, Pa., was named runner-up to Aaron McCargo of Camden, N.J., in the reality show, "TV's Next Food Network Star." Gertler spent nine weeks on the show. He can be seen in Bucks First FCU's commercial on You Tube … * RIVERSIDE, Calif. (7/30/08)--Altura CU was among the sponsors of a Riverside, Calif., appearance of the 2008 USA Olympic Synchronized Swim Team July 12 in one of the team's last performances before heading to Beijing for the Summer Olympic Games. The team performed all four routines that it will present in the Olympic events for a large crowd of local well-wishers. Two Riverside swimmers are members of the Olympic team: Brooke Abel and Meghan Kinney, who is a team alternate. Altura is a $1 billion asset, Riverside, Calif.-based credit union …

Pa. to require licenses for Internet payday lenders

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HARRISBURG, Pa. (7/30/08)--Internet payday lenders and other out-of-state companies that make consumer loans to Pennsylvania residents will need to be licensed by the state department of banking and comply with state laws, Pennsylvania Secretary of Banking Steve Kaplan announced Monday. He also cited the Pennsylvania Credit Union Association’s Credit Union Better Choice program as an example of loans offered by credit unions that cost less and can be paid back over longer periods of time than traditional payday loans (Life is a Highway July 29). The announcement is the most recent action by the department of banking to protect Pennsylvania consumers from excesses associated with payday lending. The department says the Consumer Discount Company Act (CDCA) applies to any company that lends to Pennsylvania consumers. The CDCA limits the interest and fees a non-bank company can charge for non-mortgage loans of $25,000 or less. If companies do not obtain a license from the department by Feb. 1, they face possible fines and other penalties. The department previously had interpreted the state’s CDCA to apply only to companies with a physical location or employees in Pennsylvania. As a result, companies in other states made loans to Pennsylvania consumers through the Internet or mail under terms that did not comply with Pennsylvania law.

CUs assist as California cuts state workers pay

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SACRAMENTO, Calif. (7/30/08)--Credit unions in California are preparing to help their members as Gov. Arnold Schwarzenegger plans to sign an order to reduce pay for state workers to federal minimum wage until the state budget passes. About 22,000 temporary workers and retired annuitants also will be laid off until the budget is passed (Sacramento Bee July 28). To help its members who are employed as state workers, the Golden 1 CU, Sacramento, is offering loans at 0% annual percentage rate (APR) and 4.99% APR, depending on when members signed up for direct deposit. Members with direct deposit as of June 30 are eligible for the 0% APR loan, Teresa Halleck, Golden 1 CEO, told News Now. The credit union has about 100,000 state workers in its membership of 700,000. Since the executive order was reported in the press on Thursday, members have been calling the Golden 1. “Calls are up 5%,” Halleck said. “That’s 200 extra calls.” The credit union is prepared to handle the budget impasse, she emphasized. “Members know they can rely on us. We’re here for them.” Aside from the loans, the Golden 1 also offers Lifeline Advance, a payday loan alternative, Halleck said. Sacramento (Calif.) CU, also is preparing a special program to help its members who work for the state, Jim Kelly, vice president of retail and lending operations, told News Now. About 400 of the credit union’s members work for the state. Sacramento CU is creating a loan product at 0% interest for members who have direct deposit. The program is designed to help them for a few months until the budget passes, he said. The credit union also offers a skip-a-loan-payment program, which provides members with a one-time loan extension at no charge. Sacramento CU also is willing to work with members who don’t have direct deposit at the credit union on loans. “There are a number of programs out there,” Kelly said. “We make sure we’re here to take care of our members.”

CUs report big scare no damage in LA earthquake

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LOS ANGELES (7/30/08)--Credit unions and the movement's organizations based in Southern California reported no damages from the 5.8 magnitude earthquake that hit the Los Angeles area Tuesday morning. The quake occurred just before noon in California. "It happened just about 15 minutes ago," Kathy Marcelletta, Wescom Central CU branch manager, told News Now Tuesday. Marcelletta's branch, which is located near Chino Hills, the epicenter of the earthquake, didn't feel a large impact from the quake. "The branch shook a little," she said. Members were in the branch at the time of the quake, but were not concerned, she said. Barbara Ago, president/CEO of the Pomona branch of Cal Poly FCU, just arrived at her office when she was contacted by News Now. The credit union is located in a student union building on the Cal Polytechnic Institute campus, and was just retrofitted, she said. "We are fine," she told News Now. "It was a good shake. We're a few miles from the epicenter." The credit union's office wasn't damaged, and nothing was broken--which is likely due to the fact that the credit union just repainted its walls, and had unstrapped all of its bookcases from the walls. "Our computers are up," she added. But the building the credit union is located in has some damage, and there may be damage to other buildings on campus. A campus water main broke, and drywall cracked in other buildings. Glass is being cleaned up, and "I did hear some ambulances drive by," she said. Earthquakes in the area happen about once every 15 years, she said. "We're used to it." The California Credit Union League (CCUL), based in Rancho Cucamonga, Calif., is about nine to 10 miles from the quake's epicenter, Matt Buck CCUL public affairs specialist, told News Now. “People felt the quake in Los Angeles and we felt the shaking here," Buck said. “But there was no damage, just one guy’s Pez dispensers tipped over in the corner of our office.” “We haven’t heard anything from credit unions,” he added. Western Corporate FCU's (WesCorp) facilities are located in San Dimas, about 10 miles from the epicenter. "We haven't had a good shaker like that in years," Walter Laskos, public relations director at WesCorp, told News Now. "It caught people off guard and rattled our nerves, but nothing fell off the shelf. "A lot of folks evacuated, but several remained and answered the phones. The first thing we do is check the critical systems immediately, such as the gas lines, and they were fine," he said. WesCorp's building, which was visibly shaking, is built to hospital standards and can withstand an earthquake of 8.0 magnitude, he said. WesCorp had no reports from credit unions of any damages, and Laskos was preparing a message to its member credit unions stating that WesCorp was operating. "It's business as usual." Stan Hollen, president/CEO of CO-OP Financial Services, located in Rancho Cucamonga, told News Now, "It was a good jolt and lasted about eight seconds. You definitely felt it." CO-OP's three-story building is seven miles from the epicenter, he said. Staff did not evacuate the building, but "we have a few rattled employees." The aftershock, which registered 3.8, was "barely noticeable." ATMs in the CO-OP Network were undamaged. "We checked with the Network's operations center and no ATMs or lines are down," Hollen said.

Southwest Corporate white paper addresses remote deposits

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PLANO, Texas (7/30/08)--Southwest Corporate FCU has published a new free white paper to help credit unions understand what it takes to implement and maintain a successful remote deposit program for business members. The paper, “Remote Deposit for Small Business: Greater Convenience Should Not Mean Less Service,” discusses a technology that gives businesses the ability to deposit checks electronically from their business site, eliminating trips to their financial institution (LoneStar Leaguer July 29). Southwest Corporate’s 10-page white paper examines the characteristics of businesses that might be most receptive to remote deposit and how remote deposit fits into a complete business services portfolio. It also explores the future of remote deposit technology and identifies factors to consider when evaluating service providers. “Not since the introduction of the ATM has there been so much excitement around a product and such fast adoption of it,” said Christine Barry, research director with Aite Group, in a February report on credit unions and small businesses. “As banks of all sizes increasingly look to win the business of the highly desired small business customer segment, their ability to offer coveted products--such as remote deposit--will play a large role in their overall success.” Credit unions express concern that remote deposit causes a loss of personal contact with members. Credit unions have always prided themselves on providing better-than-bank customer service, the corporate said. How do they maintain that personal touch, and cross-sell additional services when business members handle their financial services remotely? The white paper includes recommendations for building a new business model for member service, interviews with operational and marketing experts, and comments from a credit union that believes it is creating greater member loyalty with remote deposit.

League State law gives Michigan CUs an FOM alternative

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PLYMOUTH, Mich. (7/30/08)--A Pennsylvania court decision earlier this month regarding field of membership issues in the state re-emphasized what credit unions in Michigan have to be thankful for, according to the Michigan Credit Union League (MCUL). “This roadblock for the Pennsylvania credit union wishing to expand its charter is a clear contrast to the flexible fields of membership enjoyed by Michigan state-chartered credit unions, thanks to the updated Michigan Credit Union Act (MCUA),” said MCUL Executive Vice President Patrick La Pine. “Credit unions in Michigan have an alternative to dealing strictly with federal laws regarding this kind of expansion, and in a case like this wouldn't have requirements for common bond," he said (Michigan Monitor July 28). “The battle for modernization of the MCUA was a long one, but five years later Michigan credit unions can still look back and realize it was certainly worth the effort,” he added. The Michigan Credit Union Act was updated in 2003 after nearly three years of work by Michigan credit unions and the MCUL, the league said. The Credit Union National Association (CUNA) expressed disappointment July 21 on the federal court ruling that the National Credit Union Administration's (NCUA) record was not sufficient to sustain its decision granting a six-county area community credit union expansion in Pennsylvania (News Now July 22). The decision, issued by Chief Judge Yvette Kane for the U.S. District Court, Middle District of Pennsylvania, involved a lawsuit filed by the American Bankers Association and the Pennsylvania Bankers Association. CUNA pledged to begin work immediately to help credit unions deal with the judge's order. The bankers argued that the NCUA acted in an arbitrary and capricious way in 2003 when it approved Harrisburg, Pa.-based Members 1st FCU's charter request. The agency decision was later used as basis to authorize two other charter expansions for two other Pennsylvania credit unions, New Cumberland FCU and AmeriChoice FCU. The court concluded that “under all the circumstances, the decision of the NCUA is arbitrary and capricious and must be set aside.” The court determined that “after a careful review of the record, that the NCUA's analysis is insufficient in this case...”

IPost-DispatchI features CU on deposit insurance

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ST. LOUIS (7/30/08)--Anheuser-Busch Employees CU provided consumers examples of just how safe deposits are in credit unions by explaining different types of coverage in an article in the St. Louis Post-Dispatch (July 27). The article noted that insurance provided by the National Credit Union Administration and the Federal Deposit Insurance Corp. "may be the best sleep aid around" because there's "no reason to worry" about money that's federally insured. David Tate, vice president of operations at the $910.5 million asset credit union, provided examples of how a consumer's accounts are insured:
* An account in a husband's name only is insured for $100,000. His wife's separate account is also insured for another $100,000; * Their joint account is insured up to $200,000--or $100,000 each; * If the husband is a trustee in a testamentary revocable trust for the wife, the account is insured for $100,000. If the wife has an account titled as a testamentary revocable trust for the husband, it's insured for $100,000.
Total insurance for all these accounts is $600,000, but Tate explained that adding accounts that are payable on death (POD) to dependents, such as children, would mean a husband and wife who have a POD account for their two children could qualify for $400,000 in insurance--or $100,000 for each spouse and child. Tate also addressed issues related to the death of one spouse, individual retirement accounts, and the addition of a second account owner.

Free gas cards promote CUs new online accounts

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PEMBROKE PINES, Fla. (7/30/08)--In a sign of the times, Power Financial CU is promoting its new online account-opening service by giving away thousands of dollars in free gas cards and discounted oil changes. The $455.3 million asset credit union, based in Pembroke Pines, also is providing nitrogen for tires and a chance to win tickets to the Ford 400 Championship at Homestead Miami Speedway. Allan M. Prindle, president/CEO, said the new online account-opening service is "an easy way for consumers to open an account without having to visit a branch. With the rising cost of gas, we recognize that many members are looking for ways to conserve, and adding more online service features eliminates back and forth trips to the branch." As part of the official launch of the online account-opening service from Aug. 11 through 15, consumers opening a new Cash Back Checking account using the online service will be eligible for a $25 gas card at the Aug. 23 kickoff event at Mobil 1 Lube Express. Existing members can stop by the event to receive a free $10 gas card while supplies last. Mobil 1 Lube Express will offer a $5.99 discount on all oil changes, $5 off the purchase of nitrogen for tires and 10% off all other services. Members also enter to win prizes, including the grand prize--a $250 gas card, two tickets to the Ford 400 Championship, and a free oil change.

Alabama league hosts its first exec outlook conference

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BIRMINGHAM, Ala. (7/30/08)--The Alabama Credit Union League hosted its first annual Executive Outlook Conference July 22-25, with a number of credit union industry experts attending. Featured guests and presenters included:
* Stan Hollen, CEO, CO-OP Network; * Jeff Post, CEO, CUNA Mutual Group; * Dennis Adams, CEO, American Share Insurance; * Mike Schenk, Credit Union National Association vice president of economics and statistics; * Mark Meyer, Filene Research Institute CEO; * Ron Insana, Wall Street author; and * Robert Novak, journalist, who shared information on topics relevant to credit unions and his predictions for the upcoming presidential elections.
Credit union and financial experts gathered at the Alabama Credit Union League’s Executive Outlook Conference last week. From left: Mike Schenk, vice president, economics and statistics, the Credit Union National Association; Dennis Adams, CEO, ASI/ESI; Jeff Post, CEO, CUNA Mutual; and Stan Hollen, CEO, CO-OP Financial Services. (Photo provided by the Alabama Credit Union League)
“Bringing together well-respected business and industry leaders at this one-of-a-kind meeting enabled our credit union executives to get an up-close national view on the country’s economic and political landscape,” said Gary B. Wolter, league president. “As intended, this will in turn sharpen and bring focus to the credit unions’ strategies when planning for their growth and success.” Conference sponsors included American Share Insurance, CO-OP Financial Services, CUNA Mutual, Print Resources Inc., Southeast Corporate FCU and Southwest Corporate FCU.