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MBL blog notes CUs efforts to serve small biz

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WASHINGTON (9/1/09)--A member business lending (MBL) blog addresses credit unions' efforts to get a bill passed so they can serve small business at a time when capital is tight and why it might succeed. Monday's article in Inside Business, entitled "Credit unions try to seize the moment," says that in some congressional bills of the past, credit unions have asked for comprehensive regulatory relief in several areas. However, the current bill--Promoting Lending to America's Small Businesses Act of 2009 (HR 3380)--addresses only business lending. It argues that because of the lack of credit from other institutions during the recession, the 12.25% of assets MBL cap credit unions have should be raised to 25% of assets. In an environment where the government has bailed out the financial sector, the bill reinforces credit unions' message that they have remained stable. The article quotes bill sponsor Rep. Paul Kanjorski (D-Pa.) saying that permitting credit unions to expand their lending to small businesses can "work to turn around our difficult financial situation at no cost to taxpayers." Karin Sherbin, director of governmental affairs at the Virginia Credit Union League, notes that credit unions made a political compromise in 1998 by agreed on the to get the Credit Union Membership Access Act passed. Sherbin says the cap was "to throw a bone to the banking industry. We see it as not being grounded at all in good public policy. It was just politics." Craig Zuidema, vice president of lending at ABNB FCU, Chesapeake, Va., noted that there is enough business for everyone. Credit unions don't have the advantages that banks say they do when they complain about credit unions' tax exemption. "If credit unions were so attractive and had so many advantages, why hasn't a single bank ever converted to a credit union?" Zuidema says in the article. The article also cites statistics provided by the Credit Union National Association on net charge-offs. At credit unions, the net charge-off on business loans was 0.33% of total loans in 2008, compared with 1.11% at banks. CUNA projects that within the first year of the potential cap increase, an additional $10 billion will be injected into the economy. Use the link to view the entire article.

Data breach mastermind to plead guilty

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BOSTON (9/1/09)--The man accused of masterminding the Heartland Payment Systems, Hannaford Bros. and TJX Cos. data breaches agreed Monday to plead guilty to 19 counts of conspiracy, wire fraud and aggravated identity theft charges in the breaches of TJX Cos. and other retailers in 2005. Albert Gonzalez, 28, of Miami, Fla., will face 15 to 25 years in prison and forfeit more than $2.8 million in cash in the plea bargain with prosecutors in Boston (Bankinfosecurity and Computerworld Aug. 28). He will also forfeit a Miami condo, a car and jewelry. He was accused of stealing 170 million credit and debit cards in a number of breaches. The plea bargain affects charges related to TJX, Barnes and Noble and Office Max braches. The deal also includes a case in New York, where he was charged with the breach of Dave & Buster's restaurants. Data breaches against Hannaford Bros., Heartland Payment Systems, 7-Eleven stores, J.C. Penney and Target will be treated in a separate case in New Jersey. Gonzalez and two unnamed individuals were indicted in those cases in August. According to The Boston Globe, the data thefts have cost New England companies several hundred million dollars in contending with the damages wrought by the data breaches. TJX said it spent $132 million on expenses related to the breach and set aside another $39 million to handle further claims. B.J. Wholesale Club set aside $13 million between 2004 and 2007 to handle fraud claims related to its breach. Hundreds of credit unions had to replace cards compromised in the breaches and many suffered fraudulent withdrawals on accounts.

Grassroots lobbying defines Micas tenure says league

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HIGHTSTOWN, N.J. (9/1/09)--Credit Union National Association President/CEO Dan Mica's announcement that he will step down from the position in January 2011 prompted one league CEO to sum up Mica's contributions to the credit union movement in two words: "grassroots lobbying." Mica "brought so much to our movement and forever changed the way the credit union system looks," said Paul Gentile, president/CEO of the New Jersey Credit Union League, in his message in the league's newsletter (The Weekly Exchange Aug. 24).. Before he joined the league, Gentile spent a number of years as editor-in-chief of Credit Union Times, reporting on the industry and its trends. In 1996, when Mica joined CUNA, "The credit union/bank war was fierce," wrote Gentile, outlining field of membership (FOM) expansion lawsuits brought by bankers against the National Credit Union Administration (NCUA), the AT&T FCU case appealed to the Supreme Court, FOM cases in Utah and Pennsylvania and "an onslaught of banker attempts to rid credit unions of their nonprofit status. "Bankers routinely categorized NCUA as a 'cheerleader' for credit unions and not a regulator. The rhetoric was downright vicious. Vitriol spewed from bankers looking to squash expansion of the credit union movement. Credit unions were constantly on the defensive, always having to fend off one banker attack after another," he wrote. "Enter Mica. At a time when credit unions' influence on Capitol Hill was modest, Mica raised the bar," said Gentile, noting that the CUNA Political Action Committee (PAC) has become one of the top trade association PACs in the country. "But I believe Mica's greatest accomplishment was in grassroots lobbying and getting credit unions to understand that lobbying isn't just for crises. He had a vision to rally credit unions for the next attack, even when there was no attack," Gentile wrote. "Mica led the development of authentic grassroots lobbying that hinged on building relationships from the roots of the movement, the credit unions themselves," Gentile said. "Any industry can bring in hired guns to represent them on Capitol Hill, but not just any industry has the type of grassroots power that Mica shaped during his 13-year tenure at CUNA," he added. "Credit unions now understand the importance of constantly developing lawmaker relationships even when there isn't a rallying cry. Mica helped lead this sea of change in credit union lobbying. In the end, while our trade associations carry the ball on Capitol Hill, we need the participation of credit unions from throughout the country to really hit home with Congress. We have that today and Dan was the driving force." Mica built a political machine at CUNA that has the structure to influence for years to come, Gentile said, listing CUNA's annual Governmental Affairs Conference and CUNA's Calls to Action, which rally thousands of credit union leaders to get the attention of lawmakers or regulators. "We saw the power of that Call to Action earlier this year when CUNA pressured NCUA to give credit unions more information about the investments held in the corporate credit union network," he wrote. Mica "turned CUNA from a marginal player in D.C. to a respected and sophisticated force. He put us on the map." Gentile noted that the average tenure for a CUNA CEO was seven years. "Mica blew that mark away because of his passion for credit unions and his ability to get us organized in D.C. Make no mistake. Mica's mark on credit unions won't leave when he leaves."

CNYIN names new board

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RANCHO CUCAMONGA, Calif. (9/1/09)--The California and Nevada Youth Involvement Network (CNYIN) recently elected three new board members and re-elected one for 2009-2010. The three new board members are:
* Shelly Berryman, SchoolsFirst FCU, Santa Ana, Calif.; * Crystal Lyon, Silver State Schools CU, Las Vegas; and * Dhara Sanchez of Inland Empire CU in Pomona, Calif.
Chairman Michael D. Lee of The Golden 1 CU, Sacramento, was re-elected to the board. All ran unopposed. They join current board members:
* Mike Jones, Educational Employees CU, Fresno, Calif.; * Michelle Lawrence, American First CU, La Habra, Calif.; * Marlene Myers, Travis CU, Vacaville, Calif.; and * Katherine “Kate” Robinson, Greater Nevada Credit Union, Reno, Nev.
“The new board has plenty on its plate for the rest of 2009, including a September 16 webinar on private student lending,” said Cathy Arra, CNYIN liaison and California and Nevada Credit Union Leagues’ credit union growth manager. The webinar will be held from 1:30 p.m. to 3 p.m. with guest speaker Michael Weber of Credit Union Student Choice, a private student lending program. CNYIN will host a National Endowment for Financial Education’s High School Financial Planning Program Train the Trainer event at Redwood CU in Santa Rosa, Calif., Sept. 29. It also will host the Credit Union National Association’s Mad City Money simulation during the leagues’ Annual Meeting and Convention Nov. 16 in Las Vegas. On Nov. 17, CNYIN will conduct a Train the Trainer workshop at Silver State Schools CU, Las Vegas. “We have ambitious plans for 2010,” Lee said. “We hope to expand our membership base to take in associate members as well as work towards increasing our involvement with more and varied business partners.”

Minnesota award winners announced

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ST. PAUL, Minn. (9/1/09)--The Minnesota Credit Union Network (MnCUN) announced the state winners of the 2009 Dora Maxwell, Louise Herring and Desjardins awards. The awards are sponsored by MnCUN and the Credit Union National Association. Dora Maxwell Social Responsibility Awards winners include:
* West Financial CU, Medina; $5 million to $20 million in assets; * Heartland CU, St. Paul, $50 million to $100 million; * Greater Minnesota CU, Mora, $100 million to $200 million; * Mid-Minnesota FCU, Baxter, $200 million to $500 million; and * Hiway FCU, St. Paul, more than $500 million.
Louise Herring Award for Philosophy in Action winners are:
* Star Choice CU, Minneapolis, less than $50 million in assets; * First Alliance CU, Rochester, $50 million to $250 million; and * US FCU, Burnsville, more than $250 million.
Desjardins Youth Financial Education Award winners are:
* Greater Minnesota CU, $75 million to $250 million in assets; and * TopLine FCU, Maple Grove, more than $250 million.

Invest in America expands to RVs

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LIVONIA, Mich. (9/1/09)--The Invest in America program has been expanded to include seven recreational vehicle (RV) brands, announced CUcorp and RV manufacturer Thor Industries Wednesday. Credit union discounts will range from $300 to $1,000 depending on whether the RV is motorized or towable. The discounts will be available nationwide. Participating Thor brands include: Airstream, Breckenridge, CrossRoads, Damon Motor Coach, Dutchmen, Four Winds and Komfort. “The agreement with Thor will provide value for credit union members on RV purchases, help credit unions gain more market share in RV loans and help strengthen the RV manufacturing industry through ‘Invest in America’ program discounts,” said David Adams, CUcorp CEO. CUCorp is a marketing company based in Livonia, Mich., and wholly owned subsidiary of the Michigan Credit Union League. More people are staying close to home for vacations and looking to RVs as a more affordable vacation alternative, added Dicky Riegel, Thor chief operating officer. Invest in America offers credit union members discounts on select domestic auto brands, including General Motors and Chrysler. Ford is offering a pilot leasing program in six markets. Discounts also are available through mobile phone carrier Sprint. GM and Chrysler discounts through Invest in America have facilitated 180,000 vehicle sales since January with 146,000 credit union loans totaling $2.9 billion. Invest in America has garnered significant media attention on its partnership with Thor from media outlets including CNBC, MSN Money, Forbes, The Wall Street Journal, BusinessWeek, Yahoo Finance, AOL Money, The New York Daily News, the Street, the Washington Examiner and the San Francisco Examiner. A number of RV and trade media also covered the partnership.

Cann to lead NASCUS CU Advisory Council

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BOSTON (9/1/09)--J. Parker Cann, senior vice president and general counsel, Boeing Employees CU (BECU), began his two-year chairmanship of the National Association of State Credit Union Supervisors (NASCUS) Credit Union Advisory Council on Aug. 21 during the NASCUS State System Summit in Boston. Cann will serve as the council chairman until 2011. Cann, a 30-year veteran of the financial services industry, has served as both a state credit union regulator and a credit union executive. Prior to his current role at BECU, he was president/CEO of Columbia CU, Vancouver, Wash., and the chief credit union regulator for Washington state. “My chairmanship of the Credit Union Advisory Council is occurring at a critical time for credit unions and the financial services industry as a whole,” Cann said. “As we fulfill our important role as advisors to state regulators, I will continue to promote the Credit Union Advisory Council's support for state regulatory authority and the preservation of a strong state charter.” The NASCUS 2009-2010 Credit Union Executive Council, the governing body of the Advisory Council, also was announced at the meeting. The four council directors re-elected for three-year terms are:
* Ed Bibgy, Norbel CU, Colo.; * Jim Blaine, State Employees’ CU, Raleigh, N.C.; * Catherine Tierney, Community First CU, Appleton, Wis.; and * Mendell Thompson, America’s Christian CU, Glendora, Calif.
Cann also reappointed Bob Fouch, Corporate Central CU, Hales Corners, Wis., as the council’s designated corporate credit union representative for a three-year term. This year’s annual meeting was the last for Immediate Past Credit Union Advisory Council Chairman Thompson, who served as the council's leader for more than two years. The sitting Credit Union Executive Council directors are:
* Steve Behler, Kemba CU, West Chester, Ohio; * Jason Boesch, Oklahoma RE&T CU, Oklahoma City, Okla; * Linda Childs, Knoxville (Tenn.) Post Office CU; * Drema Isaac, Central Macomb Community CU, Mount Clemens, Mich.; * Debbie Peters, INCOL CU, Old Forge, Pa; and * Richard Rice, Teachers CU, South Bend, Ind.
The group also elected its officers. Tierney is the chairman-elect, and Bigby will serve as secretary.

Wegner Award recipient IBiz KidI wins Emmy

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SEATTLE (9/1/09)--Biz Kid$--the first national television program ever sponsored by America's credit unions--will be presented the National Credit Union Foundation's (NCUF) 2010 Wegner Award for Outstanding Program. And it won its first Emmy award this weekend. The show was awarded a Daytime Emmy from the National Academy of Television Arts & Science on Sunday. The award was for "Outstanding Achievement in Main Title and Graphic Design." The program was nominated in two categories. "First BizKid$ was nominated for the highest national honors in the television industry. Now it will win the highest national honors in the credit union movement," said Missouri Corporate CU President/CEO Dennis DeGroodt, who chaired NCUF's Awards and Recognition Committee during deliberations on Outstanding Program nominations. The Wegner Award will be one of four presented at NCUF's 22nd Annual Wegner Awards Dinner on Feb. 22, 2010. The dinner will take place at Grand Hyatt Washington during the Credit Union National Association's 2010 Governmental Affairs Conference. Online registration will be available later this year at NCUF's website.
Pictured are members of the cast of the credit-union sponsored public television show, Biz Kid$, which won the 2010 Wegner Award for Outstanding Program, and an Emmy. (Photo provided by the National Credit Union Foundation)
Biz Kid$ already had made TV history as the highest-carried program on American Public Television. Executive Producer Jamie Hammond noted that the Emmy award is an "affirmation of the show's quality" and "a recognition of the importance of the subject matter, given that everything that is happening in our country at this time." Washington Credit Union League President/CEO John Annaloro said the program is "the credit unions' gift to youth financial literacy in America." An Emmy "shows the power and innovativeness of the presentation," he added. "This award is a testament to the technical quality of the production, which draws viewers to the show and its lessons about financial literacy. As the exclusive underwriters of the first three seasons of the series, credit unions could not be happier." In addition to the Wegner Award and the Emmy, Biz Kid$ was also nominated as an Outstanding Children's Television by the Environmental Media Awards for its episode on the green economy. The program airs on 334 public broadcast stations, nationwide. The stations broadcast to more than 112 million households, including more than 230 million people over the age of two. That is 97% of the public television market and exceeds all American Public Television children's programs by 30%. Each episode begins and ends with a student pulling down a projection screen over a classroom billboard to reveal the America's Credit Unions logo. A narrator reminds viewers that "Production funding for Biz Kid$ is provided by America's Credit Unions, where people are worth more than money." Every episode includes four stories from successful young entrepreneurs reinforcing the importance of budgeting, saving and giving back to their community. Several of the featured youth have joined credit unions. All 39 episodes come with lesson plans, teaching materials and activities that meet national financial literacy standards. Its curriculum was developed by a credit union advisory group and Outreach Extensions, creator of the educational materials for Bill Nye the Science Guy. In the past year, more than 64,000 teachers used the Biz Kid$ curriculum to educate 9.2 million students.

California announces Maxwell Herring award winners

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RANCHO CUCAMONGA, Calif. (9/1/09)--Meriwest CU, San Jose, won first-place California state awards in the Dora Maxwell Social Responsibility Recognition Award and in the Louise Herring for Philosophy in Action Award program. Also, L.A. Financial CU, Pasadena; TUCOEMAS FCU, Visalia, and the San Francisco Chapter won first-place statewide honors in the annual Dora Maxwell program. Meriwest was recognized in the $500 million and above asset category for its “Financial Education for All” program. The credit union provided more than 115 various financial education classes to more than 1,650 community members. Its first place Louise Herring Award was in the greater than $250 million asset category for its “Financial Education for All” program geared toward young members. So far this year, the credit union educated 225 members at its in-house workshops--124 in its Teen Real World Budget workshops, and 102 in its Credit Myths and Auto Financing 101 workshops. The Credit Union of Southern California in Whittier, won second place in the $500 million and above asset category in the Dora Maxwell Award program for its annual food distribution program, which distributed more than 100,000 pounds of food to local residents in 2009. California Coast CU, San Diego, won second place in the Louise Herring Award program in the greater than $250 million asset category for its Member Loan Assistance program to help those with financial hardships and difficulties making their mortgage, secured loan or unsecured loan payments. L.A. Financial CU won a first-place Dora Maxwell award in the $200 to $500 million asset category for its partnership with the L.A. Clippers basketball team and its Kids Read to Achieve for Financial Literacy program. The program teaches youth about money by rewarding them for reading books about saving, budgeting and financial fitness. This year, the credit union reached 16,300 students, with 83 high school students participating in a financial literacy essay program for a chance to win one of five $200 scholarships. TUCOEMAS FCU received a first-place Dora Maxwell award in the $100 to $200 million asset category for its Hats for Hope program. The credit union donated 585 handmade knitted hats and 31 lap blankets to cancer patients undergoing chemotherapy and radiation treatments. The San Francisco Chapter won its first-place Dora Maxwell award in the chapter/multiple credit union category for its first “Credit Union Night with the Golden State Warriors” program. The event raised more than $2,000 for the Children’s Miracle Network and Children’s Hospital and Research Center, Oakland. The Golden 1 CU, Sacramento, received the only honorable mention given this year--in the greater than $250 million asset category in the Louise Herring Award program--for its youth programs.

CU System briefs (08/31/2009)

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* NEW YORK (9/1/09)--Municipal CU, New York, N.Y., has reported that counterfeit official checks bearing its name are in circulation, warned the Federal Deposit Insurance Corp. The items display a routing number, 011007092, which is assigned to Money Gram Payment Systems Inc., Minneapolis, Minn. The credit union issues its official checks through Money Gram via an account at The Bank of New York Mellon. The counterfeit checks have a security feature statement embedded in a darkened top border and along the bottom border between two padlocks. Authentic checks have an ornate border with a security statement below the top border and fa heat-sensitive security feature on the left side of the check. A padlock security icon is displayed next to the signature line in the lower right corner … * MONTEREY PARK, Calif. (9/1/09)--E1 Financial CU members
Click to view larger image Click for larger view
voted "yes" in favor of a merger of E1 Financial with NuVision FCU, according to a joint statement by the credit unions. The vote was certified by independent auditors on Thursday. Lynn Bowers, CEO of E1 Financial, cited increased branches and ATMs, plus opportunities for additional products and services as reasons for the vote to merge. Pending approval from regulators, the merger should be formal early in fourth quarter. The surviving credit union will be keep NuVision's name. NuVision CEO Roger Ballard will remain CEO and Bowers will become president. It will be headquartered in Huntington Beach, with branches in Los Angeles and Orange counties. Congratulating each other are, from left: Ballard; NuVision Board Chair Robert Geraci; Bowers, and John Cullum, board chair at E1 Financial CU. (Photo provided by E1 Financial CU and NuVisions FCU) ...

Missouri CUs Homes for Our Troops recipient named

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ST. LOUIS (9/1/09)--Army Staff Sgt. Robert Canine, a native of Mexico, Mo., will receive the first specially adapted home built by Missouri credit unions and Homes for Our Troops (HFOT).
Click to view larger image Army Staff Sgt. Robert Canine, a native of Mexico, Mo., standing on his new prosthetics, will receive the first specially adapted home built by Missouri credit unions and Homes for Our Troops.
Canine lost both legs below the knee in an explosion when the Humvee he was commanding was attacked in Baghdad, Iraq, on May 17. He is undergoing a year of physical therapy at Walter Reed Army Medical Center and learning to walk again on prosthetics. Canine, with his wife, Jennifer, and their eight-year-old son, Sebastian, will then return home to Missouri. Having a specially adapted house to come home to will make a tremendous difference to the family, he said. “I have stayed in homes that are not handicap accessible, and it was a challenge every day to get around,” Canine said. “The assistance I will receive from Homes for Our Troops will eliminate those daily challenges and improve my quality of living every day.” The non-profit group HFOT builds specially adapted homes for severely injured veterans, at no cost to the veteran. The Missouri Credit Union Association has joined forces with HFOT to build homes in the state. “Credit unions’ purpose is to help people and make a difference,” said Missouri Credit Union Association President/CEO Rosie Holub. “We are thrilled to lead the effort in Missouri to build homes for injured veterans that will allow them to focus their attention on recovery and living their lives to the fullest here at home.”
Click to view larger image Robert Canine (center) and his son, Sebastian, and wife, Jennifer, are long-time members of United CU, Mexico, Mo. (Photos provided by the Missouri Credit Union Association)
Canine and his extended family are long-time members of United CU, Mexico, Mo. He found out about the HFOT program from credit union staff shortly after he was injured. “After Bobby was hurt, I thought about Homes for Our Troops and how it could really help them,” said United CU Marketing Manager Heather DeMint. “I explained the program to his family in Mexico to see if they were interested and provided the information he needed to apply.” “We are proud to have Missouri credit unions join us in fulfilling our mission of building specially adapted homes for severely injured veterans,” said John Gonsalves, HFOT president and founder. Credit unions, leagues and the Credit Union National Association also partnered with HFOT and the national presidential conventions in Minnesota and Colorado for similar home projects in those states.

CU system leaders to gather at Estes Park

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WASHINGTON (9/1/09)--Credit union system leaders past and present will gather Sept. 14-17 in Estes Park, Colo., to commemorate the 75th anniversary of the Credit Union National Association (CUNA).
Click to view larger image Among the guests will be Kathy Pellitier, granddaughter of credit union pioneer Roy F. Bergengren. She is shown here speaking at an event at America's Credit Union Conference and Expo in June. (Photos provided by CUNA)
Estes Park is where CUNA's Constitution and Bylaws were signed on Aug. 10, 1934, less than two months after the Federal Credit Union Act was signed into law and 25 years after the nation's first credit union was established. "Seventy-five years ago, an extraordinary group of credit union pioneers held a 'meeting of the minds' in Estes Park, Colo., about a national association that would enhance the movement throughout the land and help it become self-reliant," said CUNA President/CEO Dan Mica. "Today, it is an honor for all of us at CUNA to continue the work set out by those leaders three-quarters of a century ago," Mica added. "Our focus, like that of our founders, is on advancing this great movement to new heights through leadership, advocacy and services." Among the highlights at this month's meeting will be special guest Kathy Pelletier of Berlin, Vt., granddaughter of credit union pioneer Roy F. Bergengren, who attended the meeting and helped found CUNA. Activities scheduled include:
* A CUNA and CUNA Strategic Services board of directors commemorative meeting; * Dedication of a 75th anniversary plaque at the YMCA Camp in Estes Park, where the original gathering of CUNA's founders took place; * Keynote speeches from today's credit union leaders; and * A photo at the outdoor site where 52 credit union delegates from 21 states and the District of Columbia originally posed for the iconic group photo taken in 1934.
Click to view larger image Pioneers of the credit union movement gathered in 1934 for a group photo commemorating the founding of the Credit Union National Association (CUNA) at Estes Park, Colo. A similar photo is planned for the CUNA 75th anniversary gathering Sept. 14-17 in Estes Park.
Among those invited to join the CUNA and CSS boards and executive management teams for the commemorative events are the credit union league presidents and their chairs from the 50 states, past CUNA chairs and CUNA presidents; representatives of affiliated and guest organizations, and board members of the National Credit Union Administration. Today CUNA represents nearly 90% of the nation's 8,000 state and federally chartered credit unions, which have combined assets of close to $900 billion and serve more than 92 million Americans. "When we meet in Estes Park as a tribute to our organization's founders, all of us will have 75 years of credit union progress on our minds--and a determination to ensure the next 75 years of progress and prosperity for credit unions," Mica said.

Tierney presented NASCUS Pierre Jay award

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BOSTON (9/1/09)--Catherine Tierney, Community First CU president/CEO, was awarded the National Association of State Credit Union Supervisors (NASCUS) 2009 Pierre Jay Award at the NASCUS State System Summit, Aug. 20-22 in Boston. The award is given to individuals who demonstrate outstanding service, leadership, achievement and efforts which benefit NASCUS and the dual-chartering system. The award was established to honor the memory of Pierre Jay, Massachusetts Banking Commissioner from 1906-1909 and the father of the first State Credit Union Act. Tierney, a 30-year veteran of the credit union system, has been active in NASCUS and other credit union organizations for years. In addition to her credit union’s recent success in challenging the Internal Revenue Service on unrelated business income tax, her Appleton, Wis.-based credit union reached $1 billion in assets--30 years after she started as a teller in the same credit union. Tierney serves as the NASCUS Credit Union Executive Council secretary and as a member of the Education and Legislative and Regulatory Affairs committees. “During Cathie’s significant career in credit unions, there has never been a hesitation to contribute where needed, reaffirm the cooperative principles of the credit union system and most importantly, represent the state credit union system on the national and state levels,” said NASCUS Past Chairman George Reynolds of Georgia, who presented the award. “I can’t think of an individual more deserving of this award,” he added. “She has worked tirelessly to preserve and advance the dual-chartering system and to fight for the interests of all state-chartered credit unions.”

Seven students internship Redesign CUs website

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SYRACUSE, N.Y. (8/31/09)--Seven seniors at Syracuse University have redesigned Empower FCU's website as part of an internship through the university. Empower, a $794 million asset credit union, told Business Journal (July 31) that it was switching to a new hosting company for its site and decided to redesign it. A credit union employee, who is also a graphics design student at the university, posted signs on campus seeking students interested in working on a redesign. The credit union wanted to appeal to a younger audience and the idea of using students seemed a good one, Empower spokesperson Mary Wilson said in the article. Applicants had to show a portfolio and interview for a slot on the project, said Donna Green, assistant professor of visual and performing arts, who helped coordinate the students' project. The group worked last spring on much of the site's graphic design and gained interview experience, plus experience in dealing with other vendors and working with a real-world client. Empower said it also added a mobile-banking feature during the redesign, so members can access their accounts, perform transfers and pay bills from personal digital assistants and cell phones, said Kelly Sherman, director of market at the credit unions. About 33,000 of Empower's roughly 80,000 members already used its online banking system, which had been in place for years. During the May launch of the mobile-banking feature, 29 members signed up the first week. Now, more than 3,600 are using the mobile feature.

Tampa Bay FCU notes courage of first-time home buyers

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TAMPA, Fla. (8/31/09)--A great impetus for first-time home buying is courage, according to Tampa Bay FCU (TBFCU). “Historically speaking, recessions get worse because people are afraid and cut all their spending with drastic measures,” said Dale Schumacher, CEO of the $278.9 million asset, Tampa. Fla.-based credit union. “Naturally, fear is contagious; I stop spending and you stop spending. “However, part of our management philosophy is to lead by example and that means having courage and faith in tough times,” he continued. “Faith and courage are contagious as well. And that’s what will stop this recession” (PRNewswire Aug. 18). TBFCU said it offers many advantages to first-time home buyers:
* Lower closing costs; * Exemption from intangible state tax; * No origination fees; * No underwriting fees; * No processing fees; * No third-party fees; and * Competitive interest rates.
The time to buy is now, said Dean Clark, TBFCU manager of real estate lending/servicing. “The housing market remains under distress because the mortgage subprime market collapse brought down the average sales price of homes for first-time buyers--qualifying people for homes that would otherwise be out of reach,” Clark added.

HarborOne is Wegner outstanding organization

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BROCKTON, Mass. (8/31/09)--HarborOne CU’s Multicultural Banking Center will receive the Herb Wegner Memorial Award for Outstanding Organization for going beyond a credit union’s traditional role by serving as a gateway for thousands of immigrants. This will be one of four awards presented at the 22nd Annual Wegner Awards Dinner hosted by the National Credit Union Foundation (NCUF) at the Grand Hyatt Washington on Feb. 22--during the Credit Union National Association’s 2010 Governmental Affairs Conference. Online registration for the dinner will be available later this year on the National Credit Union Foundation website.
Immigrants celebrate after completing a class at HarborOne CU's Multicultural Banking Center. The center will receive the Herb Wegner Memorial Award for Outstanding Organization. (Photo provided by HarborOne CU)
“Immigrants who settle in Massachusetts are fortunate to have a caring organization like HarborOne’s Multicultural Center,” said NCUF Awards and Recognition Committee Chairman Bob Schumacher, CEO of MountainCrest CU, Arlington, Wash. “The center has become a national model to deliver critical human services needed for credit unions to reach new immigrants in order to build trusting financial relationships.” Believed to be the only one of its kind in the U.S., the $1.7 billion asset, Brockton, Mass.-based credit union’s Multicultural Banking Center opened in September 2007 when the city was suffering an economic, employment and housing crisis. “Waves of immigrants were coming from many diverse areas speaking many different languages,” said Normand Grenier, executive director of South Shore Neighborhood Housing Services. “Financial institutions in the heart of the economically hard-hit area faced difficult decisions. The factories were gone--and with them, their former deposit bases. HarborOne CU reinvented itself as a lifeline and a beacon, welcoming the new Americans.” “We met with community groups and activists in our marketplace to understand why immigrants and other minorities succumb to unscrupulous lenders,” said Leo MacNeil, HarborOne’s senior vice president of community relations. “It ultimately turned out to be a matter of trust. Minorities in these communities were taken advantage of by lenders of their own ethnic backgrounds. Even though HarborOne for years had been the No. 1 low-income minority lender and had supported affordable housing efforts with numerous minority organizations, the credit union’s efforts could not overcome the trust that minorities felt toward lenders of their own ethnic backgrounds.” So HarborOne built a new brand of trust by opening a gateway for immigrants and other minorities. The credit union refurbished its vacant former headquarters to establish a network of free computer terminals, classrooms, and offices branded as the Multicultural Banking Center. The 11,000-square-foot facility was designed to support four pillars for success:
* Help residents in critical need of housing assistance due to the foreclosure crisis; * Provide educational programs to ensure that immigrants and other minorities are able to make informed financial decisions; * Offer innovative products and services to elevate the level of trust between the credit union and immigrant and minority communities; and * Partner with community-based organizations that provide related services to low- and moderate-income residents.
“HarborOne has empowered many non-profits by offering them free space at the center,” said Barbora Hazukova, regional manager of Training Resources of America. “This has enabled them to collaborate on projects and increase their outreach effectiveness.” “The center has stepped out of the traditional role of a credit union by fostering partnerships throughout our Adult Basic Education and English as a Second Language community,” said Sheila Sullivan-Jardim, executive director of the Brockton Area Workforce Investment Board. “This partnership enables us to attract families and independent wage earners, who may need additional language skills, to a business environment where they increase their chances of success in the work force.” Three of the center’s four staff members are first-generation immigrants who speak multiple languages. Classes are taught in English, French, Portuguese and Spanish. “Our center works in much the same way as a hospital emergency room,” said MacNeil. “Our receptionist/coordinator performs a triage process on every individual who comes in.” Whether they need a new job, rental housing, foreclosure prevention, credit coaching, or a loan to take the U.S. citizenship test, individuals are referred quickly to an organization and/or a class. Brockton Mayor James E. Harrington documented the positive impact that HarborOne has made on the city. “The center has assisted over 1,000 individuals’ move into mainstream banking products away from payday lending, expensive check-cashing services, unscrupulous pawnshop owners and rent-to-own vendors.” Since fourth-quarter 2007, the center has opened more than $2 million in deposits, saved low-income tax filers over $100,000 in fees and secured over $20 million in first mortgages. Brockton’s foreclosure mitigation success rate has improved from less than 5% in 2007 to over 50% in 2009. “The accomplishments at our Multicultural Center epitomize the National Credit Union Foundation’s mission of ‘improving financial independence’ through self-help, cooperation, economic empowerment and volunteerism,” MacNeil concluded. Use the resource links below.

ITheStreet.comI CUs crash student-loan party

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CAMBRIDGE, Mass. (8/24/09)--Credit unions' efforts in helping students obtain private student loans is still getting media attention, this time in Massachusetts. The wrote about a Massachusetts credit union's efforts in its "MainStreet" column Friday. "With private lenders fleeing the scene, thanks to ongoing lousy credit conditions, credit unions are increasingly picking up the slack in a market they've long avoided--student loans," began the article. It discussed Harvard University Employees CU's pact with the university to make student loans available to international graduate and professional students, who found loans drying up in the tight market. The Credit Union Student Choice program, with more than 80 credit unions participating to offer loans, is "a pretty good deal for college students," with an average interest rate of 5.8% and no origination fees, the article said. It also mentioned credit unions' programs in New Jersey and Connecticut, which have received media attention recently. Credit union loans could narrow the gap between government-backed student loans and private student loans, the Street said. Credit union borrowers get lower rates on student loans. Credit unions are in more stable financial position--since they didn't take the big credit risks that banks did. "Expect to see even more credit unions enter the student loan market--it seems like a good deal for both parties. Credit unions get access to newer, younger customers, and students get even better deals than they did from banks," the article concluded.

CU System briefs (08/27/2009)

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* MADISON, Wis. (8/24/09)--Registration closes today at 1:30 p.m. CT for CUNA Mutual Group's first free Discovery Webinar, which will take place Tuesday. John Lass, senior vice president , strategy and business at CUNA Mutual, will discuss "10 Reasons Why Credit Unions Are Needed--Now, More Than Ever." The webinar takes place from noon to 1:30 p.m. CT and will include a discussion the financial health of the credit union system. For more information, click on "webinar" on CUNA Mutual's website … … * ST. JOSEPH, Mo. (8/24/09)--Credit unions in the St. Joseph, Mo., area are teaming up with the Federal Bureau of Investigation (FBI) to help apprehend a serial robber operating in the area, according to the Missouri Credit Union Association (The Missouri difference Aug. 19). Two groups, one of credit unions and one of banks, have donated cash rewards to help generate leads and assist the FBI. The bureau says the suspect has robbed two banks and two credit unions in the area and is a suspect in robberies of five businesses. He usually uses a note to acquire money, but he recently began displaying a gun during the holdups … * SUITLAND, Md. (8/24/09)-- Andrews FCU has been named the 2008 Air Force Credit Union of the Year by the Department of the Air Force. The annual award goes to a credit union that provides exceptional services to an Air Force base community. The $879 million asset credit union received the award at the Defense Credit Union Council's 46th Annual Conference in San Francisco. Andrews Federal was cited for its commitment to financial literacy, tailored products and services, military community support, and relationship with base personnel. From left are Audrey Y. Davis, deputy assistant secretary, Department of the Air Force; Chris McDonald, Andrews FCU president/CEO; and Henry E. Bowman, vice chair, Andrews FCU board of directors. (Photo provided by Andrews FCU) …

Wash. league hosts first Evolution Summit

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FEDERAL WAY, Wash. (8/24/09)--The Washington Credit Union League is fostering discussion about the evolution of the credit union movement in Washington and worldwide through a strategic effort called “Evolution Summit.” The league’s first of a series of Evolution Forums was held Tuesday and included discussions designed to make attendees think about the future of credit unions and how they should evolve in changing times. The specific issue discussed was the charter: Can the credit unions’ charter be salvaged or is an entirely new option necessary? And with what changes? More than 25 state and national credit unions leaders gathered for the event that featured Bucky Sebastian, president/CEO of GTE FCU, Tampa, Fla., and co-founder of Callahan & Associates Inc. The event also featured Marv Umholz, a 33-year credit union industry veteran and president/CEO of Umholz Strategic Planning & Consulting Services, Olympia, Wash. The discussions will be the basis for a legislative and regulatory agenda for the league, helping it envision where it will want to be in the near and distant future.

Estonia is newest WOCCU member

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MADISON, Wis. (8/24/09)--The Estonian Union of Credit Cooperatives (EUCC), which represents credit unions in the former Soviet satellite country of Estonia, is World Council of Credit Unions' (WOCCU) newest member. At its annual meeting last month in Barcelona, Spain, WOCCU's board of directors unanimously approved EUCC’s designation as affiliate member, the second member organization in the relatively new WOCCU membership category. “We’re seeing a groundswell of credit union activity in Eastern Europe, with more countries finding that the cooperative model provides significant advantages to their citizens,” said Pete Crear, WOCCU president/CEO. EUCC, founded in 1999, represents most of Estonia's 15 credit unions, which account for 91% of the country’s credit union members and 73% of credit union assets. In April 2008, Estonia joined with the Virginia Credit Union League as part of WOCCU's International Partnerships Program. A delegation of Virginia league and credit union representatives visited Estonia last year to review the country’s credit union operations and challenges. The two groups will continue working together to address those challenges. WOCCU’s affiliate category is designed for smaller organizations representing fewer credit unions. Earlier this year, the WOCCU board approved affiliate membership status for the Azerbaijan Credit Union Association. “Creating a dues category that enables smaller organizations to join WOCCU helps foster greater growth of the global credit union movement,” Crear said. “Broader membership ranks mean more credit union members are being served in more countries worldwide. That's WOCCU's goal, and it is the goal of all our member organizations.”

INY TimesI cites CUNA website CUs cards

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NEW YORK (8/24/09)--The New York Times cited the Credit Union National Association’s (CUNA) Credit Union Finder website and credit unions’ lower interest rates on credit card balances in a recent article. With new credit card rules in effect Thursday under the Credit Card Accountability, Responsibility and Disclosure (CARD) Act, many credit card companies quickly made changes to their policies to get ahead of the rules. Under the CARD Act, financial institutions must give cardholders 45 days before increasing their interest rates or changing card terms. Cardholders irritated by the changes can seek out credit unions for better deals on credit cards, using CUNA’s website at, the Times said. “Credit unions often offer lower interest rates; find one that will accept you at,” the newspaper added. Pentagon FCU, Alexandria, Va., offers cardholders interest rates of 2.99% on transferred debt indefinitely if a member pays a one-time balance transfer fee of 2.5% of the debt and makes payments on time, the newspaper added. For more information, use the links.

Gordon Simmons to chair Defense CU Council

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PORTSMOUTH, N.H. (8/24/09)--Gordon A. Simmons, president/CEO of Service CU, was re-elected chairman of the Defense Credit Union Council for the 2009-2010 term. Simmons has more than 38 years of experience with credit unions, 34 of them at the Portsmouth, N.H.-based Service CU. He served as DCUC chairman for the past two years and during 2000-2002. He has been on the DCUC Board for 15 years, first elected as representative-at-large. Simmons also served as second vice chairman from 1996-1998 and as first vice chairman for the terms of 1998-1999 and 2006-2007. Simmons is chairman of America's Credit Union Museum Foundation, past board chairman of the New Hampshire Credit Union League, and past chairman of the Armed Forces Financial Network LLC. DCUC has 235 credit unions and more than 14 million members.

30 FSCC CUs to receive Fraud Buster Awards

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SAN DIMAS, Calif. (8/24/09)--The Financial Services Centers Cooperative Inc. (FSCC) shared branching network announced last week 30 of its client credit unions will receive awards for stopping more than $930,000 in fraud activity during first and second quarters of 2009. Recipients of the Fraud Buster Awards are recognized for protecting their credit unions, their members and members of other credit unions from fraud. Credit unions stopped fraud at every touch point in the system, said FSCC. "The award recipients demonstrated their commitment and diligence in preventing fraud for members nationwide. It is not just their members who would be impacted, but also members of other credit unions," said Sarah Canepa Bang, FSCC president/CEO. Financial institutions and businesses lose more than $48 billion annually from fraudulent activities, according to the Federal Trade Commission "Fraud is one of the most expensive security challenges facing credit unions today. And as a (credit union service organization), it is our duty to provide tools that support prevention and training for credit unions," added Bang. FSCC's Operation Advisory Committee of stockholder credit unions reviews activity and looks at ways to prevent and detect fraud through rule changes, products and services. The committee organized the awards program in 2000. In eight years, credit unions have stopped more than $7.4 million in attempted fraud, said FSCC.

Vermont regulator assumes NASCUS chairmanship

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SOUTH BURLINGTON, Vt. (8/24/09)--Tom Candon, Vermont’s deputy commissioner of banking, Friday was named chairman of the National Association of State Credit Union Supervisors (NASCUS) during its annual business meeting.
Tom Candon Friday became chairman of the National Association of State Credit Union Supervisors during its annual business meeting in Boston. Pictured are, front row, from left, Candon, deputy commissioner, Vermont Department of Banking, Insurance, Securities & Health Care Administration (BISHCA); and Joe Bergeron, president, Association of Vermont Credit Unions, surrounded by representatives from Vermont credit unions and the Vermont Department of BISHCA. (Photo provided by the Association of Vermont Credit Unions)
Candon, from the Vermont Department of Banking, Insurance, Securities & Health Care Administration (BISHCA), takes over the elected leadership role from outgoing Chairman George Reynolds of Georgia. NASCUS’ annual three-day State System Summit was held in Boston last week (Newlines Express Aug. 21). During the Chairman’s Luncheon Thursday co-sponsored by the Association of Vermont Credit Unions (AVCU), AVCU President Joe Bergeron welcomed participants to Boston, introduced Candon, and presented him with a plaque to commemorate the milestone. Candon delivered remarks about his ascension to the chairmanship and the future of NASCUS and the dual-chartering structure. Also on hand to congratulate Candon were Vermont representatives from the association, state and federal credit unions, BISHCA, and Tricorp Federal CU of Maine. Candon’s term will expire in 2011. The NASCUS board of directors for 2009-2010 was also announced at the meeting. Jerrie Jay, the Administrator of the North Carolina Division of Credit Unions, and Immediate Past Chairman Reynolds, senior deputy commissioner of the Georgia Department of Banking and Finance, were re-elected to three-year terms on the NASCUS Board. Chairman Candon also re-appointed Mary Hughes, financial institutions bureau chief of the Idaho Department of Finance, to a second one-year appointment on the NASCUS Board, which completes the nine-person governing body of NASCUS. The NASCUS Board also elected its officers. Orla Beth Peck, supervisor of credit unions, Utah Department of Financial Institutions, is the Chairman-elect, and Suzanne Cowan, director, Wisconsin Office of Credit Unions, will serve as Secretary/Treasurer.

INews NowI on hiatus until Aug. 31

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WASHINGTON and MADISON, Wis. (8/24/09)--CUNA's News Now will be on a hiatus this week and will not publish regular editions on Tuesday Aug. 25, Wednesday Aug. 26, Thursday Aug. 27, and Friday Aug. 28. However, its LiveWire tweets will continue to be posted throughout the week. Special bulletins will be posted on News Now if there are urgent developments. News Now will resume regular publication on Monday, Aug. 31.

Three CUs earn national kudos for employee benefits

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DES MOINES, Iowa (8/24/09)--Three credit unions were among 10 companies selected by Principal Financial Group to earn national recognition for their employee benefits programs. Principal Financial Group honors growing companies for their commitment to employees’ financial security in the Principal 10 Best Companies for Employee Financial Security list. The companies were selected by an independent panel of experts for maintaining extraordinary benefits programs. Credit unions earning recognition include:
* Credit Union West, Glendale, Ariz.; * Knoxville TVA Employees CU, Knoxville, Tenn.; and * Summit FCU, Rochester, N.Y.
The credit unions and other companies were noted for refraining from downsizing their employees’ benefits despite a troubled economy. In some cases, employers actually increased their employees’ benefits in addition to:
* Managing the cost of health care benefits; * Increasing wellness programs; and * Providing extra help to employees so they can make smart financial decisions given the troubled economy.
“Small- to mid-sized companies need to generate significant productivity from their employees, along with strong employee loyalty, enthusiasm and customer service,” said Tim Welsh of McKinsey and Co., who helped judge the companies. “The benefit programs that are offered by all of the 10 Best Companies really reinforce their commitment to employees while supporting vital business needs.” Turnover at the top 10 companies averages 8.9%, compared with 22.6% nationally. To qualify for Principal’s top 10 list, companies must have between five and 1,000 employees, be U.S.-based, have provided a broad range of employee benefits for at least five years, and offer retirement, health, life and/or disability insurance. For a full list of winners and their profiles, use the link.

CU educators reached 389000 students in 08-09

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COLUMBIA, S.C. (8/24/09)--Credit unions educated nearly 400,000 students during the 2008-2009 school year, according to data collected by the National Youth Involvement Board (NYIB). Credit unions taught financial management to 388,843 students in 12,652 presentations despite 19 fewer presenters reporting data this year. The totals are an increase of 3.9% for students and 12.5% over 2007 and 2008 statistics. Over five years, credit unions are increasing their presentations by an average of 12.9% annually. However, the number of presenters this past year dropped 3.59%, NYIB said. NYIB Chair Brandon Pugh said he hopes credit unions will reach 400,000 students next year. “Past performance certainly puts 400,000 in reach,” Pugh said. “With many state-level mandates taking hold and nationwide attention (in financial literacy) at its peak, credit unions should have plenty of opportunities. We look forward to seeing their reports come in at” Rachel Parrent of Vantage CU, Bridgeton, Mo., conducted the most classroom presentations--469. Marsha Lunden of Desert Schools CU, Phoenix, reached the most students--15,038--in the 2008-09 reporting year. The NYIB “Top Classroom Presenter”--the person with the greatest percentage increase in classroom presentations over the previous year--was Anissa Arthenayake of OSU FCU, Corvallis, Ore. During the 2008-09 reporting year, Arthenayake made 298 presentations, or 308% more presentations than she made in 2007-08. Michelle Merkley of Keystone FCU, West Chester, Pa., reported the highest percentage increase in the number of presentations she offered to students--3,769. The figure is 219.4% more than last year.

SAFE CU presented California Desjardins Award

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RANCHO CUCAMONGA, Calif. (8/21/09)--The California Credit Union League announced the recipients of its statewide Desjardins Youth Financial Education Awards. SAFE CU, a $1.4 billion asset credit union based in North Highlands, Calif., is the first place winner in the asset category of $250 million and above, and The Golden 1 CU, a nearly $7 billion asset credit union in Sacramento, received an honorable mention. The number of youth financial literacy presentations made by SAFE CU branch managers at local high schools during the 2008-09 school year was remarkable, said judges, given the fact its field of membership isn't education-based. It also was recognized because of its student-run high school branches. The Golden 1 CU was recognized for its youth financial literacy programs and resources including the National Endowment for Financial Education's High School Financial Planning Program, Junior Achievement and the California and Youth Involvement Network. Winners of state-level contests are eligible to compete in the national award competition, which is coordinated by the Credit Union National Association.

Kennebec conversion debate fodder for op-eds

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AUGUSTA, Maine (8/21/09)--Members of Kennebec Valley FCU will begin voting Saturday on the board's proposal to convert to a mutual savings bank and then merge with Kennebec Savings Bank (Morning Sentinel Aug. 19). The controversial merger proposal has been steady fodder for local newspapers' opinion-editorial pages for months, beginning Feb. 10 with a letter to the editor of the Kennebec Journal from Gerald C. Poulin, former board chair of the $53 million asset credit union, who opposed a merger (News Now Feb. 11). In the past two weeks letters and articles have increased, as each side presents its case. The Kennebec Journal published a letter Tuesday from member Lorraine Philbrick (Aug. 18), who noted that the credit union provides competition and helps keep prices lower and products better. If a merger is approved, "This action could very well be the beginning to an end for our credit unions in the future," she said. Andy Lacasse wrote in the Aug. 13 issue that he would vote for the merger because the credit union was "not growing" and needed a partner. "It doesn't matter to me what the label on the door is, but rather what happens when you go through it," he wrote. And on Aug. 8, the Journal published a letter from Lucille Cloutier, questioning what the advantages for members would be. "What do the members get in return for turning over all of the credit union's assets in this merger?" she asked. The Morning Sentinel reported that Kennebec Savings Bank, a community bank with a service philosophy, recently received national acclaim for its employee benefits from The Principal Financial Group, a Des Moines, Iowa-based financial services firm that named the bank one of 10 best companies for employee financial security. The bank released that news to help ease fears that jobs might be lost in the merger, the article said. That shouldn't have any impact on the merger vote, John Murphy, president of the Maine Credit Union League, told the newspaper. The league opposes the merger. "It's an issue of the membership and how they're going to benefit from such a conversion," Murphy said, adding that members have the option to join the bank if they want. If the merge is approved, the bank would acquire more than $5 million in capital assets owned by credit union membership, he said. Voting will end on Sept. 21.

Credit card statement stuffer explains new law

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MADISON, Wis. (8/21/09)--The Credit Union National Association (CUNA) has new materials to assist credit unions in setting the record straight with members on what the new Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009 will mean to them. While educating members about the effects, credit unions also can take the opportunity to remind members they'll get their best credit card deals at their credit union. "New Law Shows Credit Union Cards Still the Best" is a new statement stuffer that will help credit unions explain the impact of the new CARD Act, parts of which started taking effect Thursday. The six-panel statement stuffer includes a three-panel table that outlines the new law, when the changes become effective, and what it will mean for consumers. The stuffer addresses fees, interest rates, disclosures, payments, oversight, prepaid and gift cards, as well as changes for consumers under the age of 21. "In a way, there's almost too much information about the new law in the news. Consumers are very confused and will welcome this simple table--it outlines the big changes and when they will happen," said Michelle Dosher, managing editor at CUNA's Center for Personal Finance. Credit unions also can remind their members why the The New York Times (July 9 and June 24) says credit union credit cards are a great test for how other card providers will perform under the new law--because credit union cards already perform in consumers' best interests.

Northeast CU is top CUDL lender in New England

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PORTSMOUTH, N.H. (8/21/09)--Northeast CU (NECU) was named top CUDL lender in New Hampshire and New England by CUDL (Credit Union Direct Lending) Merge magazine. The CUDL organization works with U.S. auto dealers to make credit union auto loans available wherever cars are sold. NECU generated more than 5,000 loans, earning the No. 1 spot on the top 10 lenders list in New Hampshire and No. 1 on the top five credit union lenders list in New England, according to CUDL’s 2009 summer regional lending report. “In this current climate where the big banks and finance companies are reducing staff, tightening lending criteria and making it more difficult for the local dealer to speak to them, we have a different formula,” said Doug Sites, NECU assistant vice president of lending. “Northeast CU’s success is based on an experienced underwriting staff, a full- time relationship manager and a philosophy that dealer relationships and service are keys to retaining and growing the business no matter what business cycle we’re in.” Auto lending has always been a core product for NECU, Sites said. Northeast CU, based in Portsmouth, N.H., has $656 million in assets.

VolCorp announces board elections

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NASHVILLE, Tenn. (8/21/09)--Volunteer Corporate CU (VolCorp) announced the election of officers to its board of directors at its recent annual meeting. Officers elected were:
* Chairman--Hank Flury, Cornerstone Financial CU, Nashville; * Vice Chairman--Blake Strickland, Tennessee Valley FCU, Chattanooga, Tenn.; * Treasurer--David Atkinson, Eastman CU, Kingsport, Tenn.; and * Secretary--Karen Jordan, P&G Employees FCU, Cincinnati.
Newly elected board members are Mike Haggard, Healthnet FCU, Memphis, and Ken Swann, City of Memphis CU. Other board members include:
* Robert Arick, director, Agility Financial CU, Memphis; * Dave Mullican, director, Chattanooga (Tenn.) Federal Employees CU; and * Rose Melton, director, Altra FCU, Lexington, Ky.
With its national field of membership, VolCorp serves 266 credit unions in Tennessee, Alabama, Kentucky, Georgia, Mississippi, South Carolina and West Virginia. VolCorp, based in Nashville, has more than $1.3 billion in assets.

CU System briefs (08/20/2009)

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* WILLIAMSPORT, Pa. (8/21/09)--Horizons FCU, based in Williamsport, Pa., reported that counterfeit cashier's checks bearing its name are in circulation, according to the Federal Deposit Insurance Corp. The items display the wrong routing number--031302528--which is the number of Woodlands Bank, a Williamsport bank that issues Horizon's checks. The counterfeit items display a security feature statement embedded in a darkened top border, with the credit union's name, and mailing and street addresses at the top left. Horizon's authentic checks are light blue with a border that varies in color: dark blue, dark purple or dark orange. Its logo, name, mailing and street address, telephone and fax numbers are in the top left corner … * DALLAS (8/21/09)--Texans CU received the Junior Achievement (JA) of Dallas's "highest team average" honor for dollars the credit union raised for the 2009 JA Bowl-A-Thon. The credit union contributed nearly $8,999 with fundraisers such as "Jeans Day Fridays" and raffling off first-floor parking spots donated by executives. Eighteen Texans employees participated in the bowl-a-thon, which raised $216,000 for JA of Dallas. Bowl-a-thon team captains showing off the trophy awarded to Texans are, from left: Orlando Huerta, Sue Nash, Daisy Harris, Stacey Hastings and Dee Fincher. (Photo provided by Texans CU) … * ROCHESTER, Minn. (8/21/09)--Minnesota U.S. Rep. Tim Walz (D-1) met with nine credit union representatives in a constituents' roundtable focused on credit union issues Aug. 18. They discussed several federal legislative issues, including regulation of the financial services industry. Citing H.R. 3126, which would create a Consumer Financial Protection Agency, credit unions emphasized the importance of maintaining an independent credit union regulator. Waltz acknowledged credit unions' concerns and agreed the mainstream financial services industry has not demonstrated a need for a "super regulator." As Congress works to protect consumers, elected officials need to ensure they do not punish financial institutions that have practiced diligence by working and complying with agencies such as the National Credit Union Administration and the Federal Deposit Insurance Corp., said Walz. Credit unions also addressed their challenges in complying with parts of the Credit Card Accountability, Responsibility and Disclosure (CARD) Act. Credit unions discussed the Promoting Lending For America's Small Business Act (H.R. 3380) and highlighted benefits credit unions offer small businesses through member business lending. Walz encouraged attendees to keep in contact with him as the issues progress through Congress. "Congressman Walz's desire to meet with us during his busy August recess demonstrates that he identifies credit unions as an important constituent group in his district," said Mara Humphrey, Minnesota Credit Union Network vice president--governmental affairs. (Photo provided by the Minnesota Credit Union Network) … * ST. LOUIS (8/21/09)--The Missouri Credit Union Association (MCUA) is coordinating meetings across the state to give credit unions a platform to discuss their concerns with lawmakers. U.S. Rep. Ike Skelton (center of top photo) (D-District 4) met with 10 credit union leaders to discuss industry concerns about member business lending and open-ended lending in the Credit CARD Act. The meeting took place Aug. 14 at a CommunityAmerica CU branch in Blue Springs. Local media outlets were invited to the meeting by Skelton's staff. See article in local newspaper . Other meetings included an Aug. 13 meeting with Cindy Eberting Hall, a staffer of Sen. Claire McCaskill's (D) office, Missouri CU President/CEO Hal James and MCUA Senior Vice President Peggy Nalls. Representatives from four Springfield area credit unions met Aug. 17 with Dan Wadlington of U.S. Rep. Roy Blunt's (R-7) office. Wadlington is shown at center in the second photo. (Photos provided by the Missouri Credit Union Association) …

New WOCCU chairman a seasoned vet of U.S. movement

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REDWOOD CITY, Calif. (8/21/09)--The new chairman of the World Council of Credit Unions (WOCCU) is a seasoned veteran of the U.S. credit union movement.
Click to view larger image Barry Jolette, new World Council of Credit Unions chair, (left) accepts the chain of office from former chair Melvin Edwards at the World Credit Union Conference in Barcelona, Spain. (Photo provided by the World Council of Credit Unions)
Barry Jolette, president/CEO of San Mateo CU (SMCU) in Redwood City, Calif., was named chairman of the board of WOCCU during its World Credit Union Conference in Barcelona, Spain, July 28. Jolette, who served as Credit Union National Association chairman from 2001 to 2003, has been president/CEO of SMCU since 1987. He also received the California Credit Union League Distinguished Service Award and Leo H. Shapiro Lifetime Achievement Award in 1997. In 2007, he received the Herb Wegner Memorial Award for Lifetime achievement, the credit union industry’s highest national honor. “I have been involved in credit unions for most of my life, and it is so rewarding to see the credit union movement remain healthy and robust in spite of the economic challenges that may arise,” Jolette said. “Clearly, the credit union philosophy of ‘people helping people’ has proven its worth as a powerful financial tool.” SMCU has more than $600 million in assets.

NYIB honors outstanding contributors

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COLUMBIA, S.C. (8/21/09)--The National Youth Involvement Board (NYIB) recognized two credit union professionals for their work in youth marketing, education and leadership development at its annual conference in Tempe, Ariz., Aug. 4. Julie McLean was named 2009 Delegate of the Year. She is the director of financial education at Arapahoe CU, Littleton, Colo., which won a 2008 Desjardins Youth Financial Education Award. She also is a board member of Littleton Public Schools and a member of the Colorado Certified Technical Education Advisory Council, serving as chair of the Family and Consumer Sciences Committee. McLean reached 6,482 young people in 257 financial education presentations during 2008-09. She works with the National Endowment for Financial Education (NEFE), Colorado Jump$tart, and the Credit Union Association of Colorado. She received NYIB’s Robert L. Curry Scholarship in 2007. NYIB’s Outstanding Volunteer of the Year is Dawn Ambuehl-Sadek, financial education specialist for A+ FCU, Austin, Texas. Ambuehl-Sadek is a certified Texas Educator and teaches the NEFE High School Financial Planning Program, conducts teacher training events, and serves on the logistics committee for Financial Fitness Greater Austin. She is also a member of Project NEFE, a statewide financial education initiative. Ambuehl-Sadek made 39 presentations to 589 students during the past year. She regularly appears on an early-morning Austin news segment entitled “Your Money” and was a financial services category finalist for the Austin Under 40 Awards. A+ FCU also recently garnered the Texas Credit Union Foundation’s FOCUS Award for commitment to financial literacy. NYIB accepts nominees for annual recognition, including the Delegate and Volunteer of the Year, plus applicants for scholarships to attend the NYIB annual conference and the National Credit Union Foundation Development Education Training.

Radisson hotels breached check your accounts

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MINNEAPOLIS (8/20/09)--Credit union representatives and members who travel may want to check their credit card accounts. Radisson Hotels and Resorts announced Wednesday that the computer systems of some Radisson hotels in the U.S. and Canada were accessed without authorization between November 2008 and May. The data accessed may have included guest information such as the name printed on a guest’s credit card or debit card, a credit or debit card number, and card expiration date, Radisson said in a letter posted on its website. Social Security numbers were not accessed. “We recommend that you review your account statements and credit reports closely,” Radisson said. Individuals who suspect unauthorized card activity should report it to the financial institution that issued the card, law enforcement, state attorney general’s office, or the Federal Trade Commission. No educational programs with the American Association of Credit Union Leagues or the Credit Union National Association’s (CUNA) Center for Professional Development (CPD) were held at Radisson hotels during the breach period, said CUNA CPD staff. News Now did not verify whether state credit union organizations might have had conferences then at Radisson hotels. Radisson has created a toll-free telephone number, 866-584-9255, for customers to call if they have been affected. The company also has created a website with frequently asked questions about the breach (use the link). Radisson Hotels and Resorts, based in Minneapolis, has more than 400 hotels worldwide. The breach was announced just a day after the Justice Department disclosed indictments of the hackers who caused the world’s largest data breaches--at Heartland Payment Systems and Hannaford Brothers. Those breaches affected thousands of credit union members.

CUSOs and restructured loans highlighted in article

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FORT LAUDERDALE, Fla. (8/20/09)--The National Credit Union Administration's (NCUA) guidance on selling nonperforming loans to credit union service organizations (CUSOs) is the topic of an article in a Florida-based business review. Wednesday's article in Broward Daily Business Review notes that the decision is expected to help credit unions during the recession by removing nonperforming loans from their books. CUSOs previously could purchase, service and collect on troubled loans but were not allowed to restructure them because they are not allowed to make consumer loans, said Miami attorney Michael Lozoff, who obtained a clarification from NCUA on behalf of credit unions he works with. Now a CUSO can restructure the loan if 1) the credit union has made the original underwriting decision and 2) the loan involves no new credit or principal extended by the CUSO. A credit union wanting a loan off its books so it doesn't take a hit or show a loan as delinquent can sell it to the CUSO. That turns the loan into an asset. The credit union gets some payment--say 20 cents on the dollar. It pays the balance from its loan-loss reserve account and gives the loan to the CUSO to collect. The article outlines the debate on whether this is good. While selling bad loans to a CUSO makes operational sense, it doesn't change the fact that it has a bad loan, said Kamal Mustafa, chairman of Invictus Consulting Group, a New York firm that works with credit unions and small to medium-size banks. In the article, he noted this merely moves the problem. Some credit unions may put a lot of bad assets into a CUSO. Lozoff, however, said that a nonperforming loan can be converted to a performing loan through effective restructuring. And that, he told the publication, is a solved problem. The operational challenge for credit unions is whether it is cost-effective to create the program internally or share resources through a collaborate effort such as a CUSO, he said. The article also addresses the structure of CUSOs and notes the cooperative efforts involved with several credit unions consolidating back operations through a CUSO. "Banks typically don't cooperate to that extent because they're more in direct competition," Lozoff told the publication.

NYIB elects leaders for 2009-2010

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COLUMBIA, S.C. (8/20/09)--The National Youth Involvement Board (NYIB) announced its leaders for 2009-2010 at the NYIB annual meeting in Tempe, Ariz., on Aug. 6. Brandon Pugh, director of communications and public relations at the South Carolina Credit Union League, will continue to chair the NYIB for 2009-10. Those elected to two-year terms as regional coordinators include:
* North West: Adam VanCleave, youth operations coordinator at Chetco FCU, Brookings, Ore.; * North East: Mary Ann Demczak, financial counselor at Clearview FCU, Moon Township, Pa.; and * North Central: Pamela Swope, marketing manager, FinancialEdge Community CU, Bay City, Mich.
South West Regional Coordinator Rebecca Isaacs, business development director at the Credit Union Association of New Mexico, will continue the second year of her term. Special elections were held for unexpired one-year terms in two southern regions. Filling the positions are:
* South Central: Doug Adams, president/CEO, MUNA FCU, Meridian, Miss.; and * South East: Dawn Lindley, director of marketing and financial literacy, Virginia Credit Union League.
This year’s officers include: Vice Chairman Isaacs; Secretary Lindley; Treasurer Swope; and Media Manager VanCleave. The group will meet Sept. 26-29 for its annual planning session.

520 participated in Illinois CARD Act webinars

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NAPERVILLE, Ill. (8/20/09)--More than 520 individuals participated last week in two webinars hosted by the Illinois Credit Union League (ICUL) and ICUL Service Corp. to address critical compliance dates and information about the recently signed Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009. The individuals, from across the country, were from credit unions that use ICUL Service Corp. card programs. The Service Corp has card programs in 45 states for more than 3,100 credit unions and has a portfolio of more than half a million cards. The deadline for compliance with part of the act is today. The sessions discussed changes affecting fee limitation, limits on rate increase, underwriting requirements, notice, payment processing, today's compliance requirements, new requirements for cards issued to those under age 21, impact on gift-card programs, the facts needed to review and revise account terms to comply, and February 2010 compliance requirements. The webinars were presented by Con O'Mahoney, ICUL senior compliance analyst, and Cathy Pettis, ICUL Service Corp. senior vice president of operations. Pettis said the service corp will offer future webinars for its credit unions to share new information as it becomes available. The league created an archive page on its website that includes the audio and Power Point presentation. Questions from the webinars will posted to the archive page by Sept. 1.

CUANM helps pay waived prepaid-card ATM fees

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ALBUQUERQUE, N.M. (8/20/09)--The Credit Union Association of New Mexico (CUANM) presented a check Aug. 13 to CU Anytime, an ATM network, to help pay for fees that the network waived for prepaid debit cards issued by a state agency.
Credit Union Association of New Mexico (CUANM) board Chairman William Jacobs, left, and CEO Sylvia Lyon present a check for $10,000 to Don Gray, president of CU Anytime ATM network. CUANM returned a portion of surcharge fees that CU Anytime waived for New Mexico residents, who used a prepaid debit card from the state Workforce Solutions division at the ATMs, to access unemployment benefits. (Photo provided by the Credit Union Association of New Mexico)
CUANM had announced in April that the state’s regional ATM network would waive the fees. New Mexicans receiving unemployment benefits from the New Mexico Workforce Solutions division do not incur the $1.75 ATM fee at CU Anytime ATMs when using the card to conduct transactions. There are 27 credit unions in the ATM network, with 170 locations in New Mexico and seven in El Paso, Texas. CUANM has committed to return a portion of the funds that CU Anytime would have received from surcharge fees, announced CUANM President Sylvia Lyon. “In tough times after losing a job, every little bit helps,” Lyon said. “We’re pleased that people facing unemployment in New Mexico were able to get a break on these fees and we’re glad to help them out.”

NASCUS to debut new logo website at its summit

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ARLINGTON, Va. (8/20/09)--The National Association of State Credit Union Supervisors (NASCUS) will reveal a new corporate logo and updates to its website at the NASCUS State System Summit, held today through Saturday in Boston. “As an organization, NASCUS continues to strengthen its position as the primary advocate for state regulators and the state credit union system. Our new logo symbolizes that innovation and progress as well as our modern identity,” said NASCUS President/ CEO Mary Martha Fortney. In addition to displaying the new logo and an updated design, the NASCUS website has improved navigation and enhanced regulatory resources for NASCUS members. NASCUS said it remains focused on providing its members with updates on state system issues and the latest in compliance, operational and regulatory issues.

WalletPop Bill hiking MBL limit good for small biz

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WASHINGTON (8/20/09)--A bill that would hike credit unions’ member business lending limits could give small businesses some hope, according to WalletPop. Walletpop is the name of the personal finance page on the America Online--or AOL--website. WalletPop Tuesday noted that credit unions may be able to lend more money to small businesses if a bill increasing their member business lending limit to 25% is approved. U.S. Reps. Paul Kanjorski (D-Pa.) and Ed Royce (R-Calif.) introduced a bill July 29 that would increase the lending limit from 12.25% to 25%. “This could free up an extra $10 billion of capital for small businesses and commercial loans, and if it makes credit unions more competitive with banks, everyone would benefit from the increased lending,” WalletPop said. “If you’re a small business owner who has been hoping to grow your business with the help of a commercial loan, this could give you some hope.” The article also cited a letter written to Kanjorski and Royce by Credit Union National Association President/CEO Dan Mica, which stated, “When other lenders have been forced to pull back lines of credit, credit unions have continued to lend and they have the capacity to do more. “Increasing the credit union member business lending cap makes sense for a number of reasons: credit unions have proven themselves as financial institutions that know their members and know how to lend to their members; they have demonstrated the ability to provide these loans safely and soundly; and most importantly, they can help address a real need in difficult economic times,” Mica added.

21 Oregon CUs get REAL

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BEAVERTON, Ore. (9/20/09)--Twenty-one Oregon credit unions are participating in the state's pilot of the National Credit Union Foundation's REAL Solutions program, the Credit Union Association of Oregon (CUAO) announced Wednesday. The program helps credit unions meet the needs of members with low or moderate incomes, young adults, new Americans and the unbanked. During the pilot year, 21 credit unions will work with CUAO to initiate the program in their credit unions. They have indicated that outreach to young adults is a primary goal. "We are thrilled to bring REAL Solutions to Oregon," said Kasey Rockwell, CUAO's director of credit union development. Oregon's credit unions "will be able to tap into the resources of the REAL Solutions program, as well as network with over 600 credit unions across the country to enhance their mission as a member-owned cooperative. "Our focus is on helping our members and, ultimately, developing stronger and healthier Oregon families and communities," Rockwell added. As part of REAL Solutions, credit unions' programs aim to reduce dependency on predatory financial providers, encourage saving and wealth-building, build creditworthiness, increase financial self-sufficiency and improve the economic well-being of Oregon communities. CUAO's participation is supported by a grant from the Oregon Credit Union Foundation. The first partnership meeting will take place Sept. 10 in Albany, Ore.

CU System briefs (08/19/2009)

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* SUITLAND, Md. (8/20/09)--Andrews FCU member Michelyn Bell, center, was awarded $100 for her winning entry in the Credit Union National Association's (CUNA) C-Note University online photo contest. C-Note posts a photo contest theme each month, and registered users, age 13-19, can vote for their favorite photo. All monthly winners are entered to win a $1,000 grand prize each year. The contest is supported by Andrews Federal through the Money $quad youth program. Bell is shown here with, from left: Pat Philippe, Andrews Federal acting branch manager, Henson Ridge, and Suzanne Curren, Andrews Federal director, public relations and community development. For more information about C-Note and CUNA's other websites for youth, use the link. (Photo provided by Andrews FCU) … * ALBANY, N.Y. (8/20/09)--Seventy soggy credit unions, vendors and friends from across New York state raised $13,000 for the New York Credit Union Foundation (NYCUF) during a rainy golf tournament recently. The event was held at Saratoga Spa Golf Course. Shown braving the weather are, from left, golf foursome Terry and Diane Slocum of Remington FCU, Ilion, and Marcie Gallagher and Roy Haller of Utica District Telephone Employees FCU, Utica. (Photo provided by the New York Credit Union Foundation) … * WAUSAU, Wis. (8/20/09)--Connexus CU, based in Wausau, Wis., has launched online enrollment for members through its website, Members and potential members can open a membership and/or checking account and fund the account online. Members' information is integrated into Connexus' core processor, XP systems, a part of the Depository Institution Division at Brookfield, Wis.-based Fiserv. The online enrollment takes between seven and 10 minutes. Members receive their member number, and cards with the account are ordered within one day. Normally it would take roughly 30 minutes of employee time to process an application manually. The online enrollment saves the credit union 50%-75% of costs related to member enrollment. PM Systems Corp. of Chapin, S. C. provides the new system … * NORTH ANDOVER, Mass. (8/20/09)--A robber apologized to employees of the Merrimack Valley FCU as he ran from the building with the credit union's cash Monday The man robbed the $391.8 million asset, North Andover-based credit union of an undisclosed amount. As he left the building, he told the employees: "Sorry." He did not display a weapon and dropped several $100 bills as he fled. Police said they hoped to get fingerprints from the bills (Associated Press Newswires Aug. 19) … * HARRISBURG, Pa. (8/20/09)--Funeral services will be held Friday for John Bixler Jr., 85, founder and retired president of Mid-Atlantic Corporate FCU and retired president of Pennsylvania Central FCU. Bixler, 85, died Monday. Services will be at 11 a.m. Friday at the United Church of God in Harrisburg, Pa., with a viewing at the church from 8:30 a.m. to 11 a.m. He is survived by two children, four grandchildren and five great-grandchildren. His wife, Doris, died on July 13 (Life is a Highway Aug. 19) …

CU System briefs (08/18/2009)

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* SUITLAND, Md. (8/19/09)--Andrews FCU has launched "Debt in Focus," a new online debt management tool created by the Filene Research Institute. The program helps people improve credit scores and better manage debt. It takes about 10 minutes to complete and provides members with an in-depth analysis of their financial position. The serve is free to members and others visiting Andrews' website. Andrews FCU is a $878.3 million asset credit union in Suitland, Md. … * HARRISBURG, Pa. (8/19/09)--The PaCUSC Board has appointed Linda Brown, executive vice president of Service lst FCU, Danville, Pa., to fill a board seat left vacant by the death of Rob Vuono. Brown is a member of the Filene Research Institute's i3 Group, which uses innovation to prepare credit unions for the future. She worked on projects to market to young adults, developing a credit union-based 1031 Exchange and a prize-based saving program (Life is a Highway Aug 14) … * CHICAGO (8/19/09)--Werner Thiele, 88, of Chicago died recently. Thiele, a native of Germany, was former president of International Harvester Employees CU in Springfield, Ohio. He is survived by his wife Anne and son Eric. (Chicago Tribune Aug. 14) …

Cooperatives at center of health care debate

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WASHINGTON (8/19/09)--Cooperatives have become a new buzzword as legislators consider proposals to reform the health care industry. The National Cooperative Business Association (NCBA) this week educated media about what a cooperative is and mentioned credit unions prominently as a good cooperative business model the government could follow. NCBA President/CEO Paul Hazen has been featured in BusinessWeek and The Washington Times, as well as WTOP-Radio; Channel 6 News in Tulsa, Okla.; WGN-Radio's "Greg Jarrett News Show" in Chicago and Christian Broadcasting Network's CBN News during the past two days. Adam Schwartz, NCBA vice president of public affairs and member services, was featured on Minnesota Public Radio. They discussed the proposal to use co-ops instead of a government-run insurance option as part of health care reform. The proposal, that cooperatives could serve as a model for health insurance cooperatives, was made by Sen. Kent Conrad (D-N.D.), whose state gets much of its electricity through utilities cooperatives. The proposal would cost about $6 billion in startup funding in the form of federal grants or loans. While the plan is appealing, since cooperatives are owned and run by their members, the public must first understand cooperatives more clearly before making a judgment, said Hazen. Unlike today's health insurance companies, cooperatives' purpose is to provide services to people, not to maximize profit, he said. Any health care reform needs to address fundamental issues such as the escalating cost of health care. More than 300 health care cooperatives already exist in parts of the country, including Arizona, California, Minnesota, Tennessee, and Washington state. But they don't underwrite and sell health insurance. They simply negotiate the rates on pre-existing plans with health insurance companies (Business Week Aug. 17). To operate as Conrad has proposed would mean the co-ops would need to enough members to reach scale so they could competitively negotiate directly with health care providers--doctors, hospitals and drug companies--Hazen told several of the media. Many cooperatives familiar to Americans are owned and run by farmers. The model closer to what the health insurance program would look like is a credit union, he told The Washington Times (Aug. 18) and CBN News. Co-ops work best when developed from the ground up, not the top down, he told the Times. A co-op's success should be judged over a 10- to 20-year period, not as a quick fix to the nation's health care problems. NCBA can't endorse or reject the proposal until it knows exactly how the insurance cooperatives will be set up and regulated, Hazen said. The key would be how the health co-ops would be organized. "We need more information. The public cannot meaningfully engage this debate unless the (Senate) Finance Committee releases more information," he said. NCBA says there are 29,284 cooperatives in the U.S. generating more than $652 billion in revenue, $75 billion in income and more than two million jobs. Cooperatives account for roughly 1% of the U.S. Gross Domestic Product ($154 billion of $14 trillion).

Kentucky league announces state award winners

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LOUISVILLE, Ky. (8/19/09)--The Kentucky Credit Union League announced its 2009 state-level winners for the Dora Maxwell Social Responsibility Award, Louise Herring Award for Philosophy in Action and the Desjardins Youth Financial Education award. State-level Dora Maxwell winners include:
* Kentucky Employees CU, Frankfort, $20 million to $50 million asset category; * Autotruck FCU, Louisville, $50 million to $100 million; * Park Community FCU, Louisville, $200 million to $500 million; and * L&N FCU, Louisville, $500 million.
ClassAct FCU, Louisville, won the Louise Herring award in the $50 million to $250 million asset category. Park Community also received the Desjardins award in the $250 million asset category. The award programs are sponsored by the Credit Union National Association (CUNA). The first-place winners will advance to national competition. The league will recognize winners at its annual meeting in November. CUNA will recognize national winners during the annual Governmental Affairs Conference (By the Way newsletter August).

NASCUS celebrates state-chartered CUs 100 years

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BOSTON (8/19/09)--The National Association of State Credit Union Supervisors (NASCUS) will meet for its annual State System Summit, Thursday through Saturday in Boston. NASCUS’ events begin today with business meetings of its leadership and a joint regulators meeting with the Conference of State Bank Supervisors (CSBS). Also today, NASCUS is conducting a directors college for New England area credit union directors. The week will culminate with the State System Summit. “One hundred years ago, Massachusetts passed the first state credit union act creating an example for state and federal credit union chartering,” said NASCUS President/CEO Mary Martha Fortney. “The 2009 NASCUS Summit will recognize this milestone in state credit union history and focus on the constructive dialogue to strengthen safety and soundness, as well as improve the financial health of credit union members.” At this year’s meeting, NASCUS’ current Chairman George Reynolds (Georgia) will pass the leadership to a new chairman, Thomas Candon, deputy commissioner of banking for Vermont’s Department of Banking, Insurance, Securities and Health Care Administration. Parker Cann, senior vice president and general counsel of BECU, Tukwila, Wash., will assume the chairmanship of the NASCUS Credit Union Advisory Council, a position currently held by Mendell Thompson, America’s Christian CU, Glendora, Calif. The summit’s featured speakers include Federal Deposit Insurance Corp. board member Thomas Curry; National Credit Union Administration Vice Chair Rodney Hood, and board member and NASCUS liaison Gigi Hyland; mortgage experts Tracy Ashfield and Richard Hagar; and Callahan and Associates President Chip Filson. The agenda includes presentations on the state of the corporate credit union system, supplemental capital, vendor management, unrelated business income tax, credit union taxation, shared-branching issues and consumer-lending regulatory updates.

New mortgage loan company rises from CU Mortgage ashes

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GARFIELD, N.J. (8/19/09)--A core group of credit union mortgage professionals who worked for the now-defunct CU National Mortgage have opened Clarity Member Services, a mortgage services provider based in Garfield, N.J. They decided to create Clarity Member Services, which opened July 1, because they feel it is the best way to continue leveraging their experience with mortgages and credit unions. “We wanted to do more of what we did best,” said Jill Peterson, Clarity vice president of sales and marketing. “We love credit unions--they’re fantastic to work with and we’re looking forward to providing service to them again.” CU National Mortgage closed this year after filing for bankruptcy in February. Its president, Michael McGrath, pleaded guilty in June to defrauding about $139.6 million from 19 credit unions and Fannie Mae. McGrath admitted to conspiring with others to fraudulently sell credit union loans and use the proceeds to finance U.S. Mortgage’s operations and investments for himself and the company (News Now June 12). None of Clarity’s personnel are implicated in these events. Clarity will offer conventional, Federal Housing Administration, jumbo, condo and co-op mortgage products. Its operation will be unique because it must deliver the same level of service to clients as credit unions bring to their members, Peterson said. Clarity employees six full-time individuals, and is prepared to bring more staff on as needed. Peterson told News Now that while at CU National, she learned some invaluable lessons about what credit unions need, and what could have been done to prevent the crime that shut down the company. Phil Scialabba, Clarity president, said loan files would not be stored onsite at CU National--which had contributed to the fraud at CU National Mortgage. Original documents from Clarity will be shipped to the credit union or investor, and parent companies will not have access. Credit unions also will see the loan process from start to finish by viewing electronic files. They can view their loan files, documentation, reporting and metrics as if the loans were run by their own staff. “We’ll provide a high level of security,” Peterson said. While Clarity will maintain privacy, it also will allow credit unions to come in and look at the company’s records to keep its integrity. “The door is wide open,” Peterson said. Since it opened, Clarity has received a favorable response from its vendors, such as CUNA Mutual Group and Prime Alliance. The company hasn’t started marketing yet, but hopes to sign four or five clients by the end of the third quarter, Scialabba said. The company also will use the same system it had at CU National. There won’t be a long learning curve for staff, he added. “We’re incredibly proud of what we did at CU National,” Peterson said. “It’s extremely unfortunate that one person perpetrated an awful crime that hurt so many people and credit unions.”

Panthers QB pitches CUs financial tips

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CHARLOTTE, N.C. (8/19/09)--Jake Delhomme, National Football League quarterback for the Carolina Panthers, will provide tips on financial fees and interest rates in three television commercials for Charlotte Metro FCU. Delhomme is the type of multimillionaire who can tout a credit union’s good points, said Nathan Tothrow, marketing chief for the $184.3 million asset, Charlotte, N.C-based credit union ( Aug. 18). “He’s about as unpretentious as you can get [for] a sports figure,” Tothrow told the newspaper. Delhomme “was kind of jazzed” about doing a commercial for the credit union, David Riggs, his marketing agent at Chicago-based Priority Sports & Entertainment, told the paper. “He’s not one of those athletes who just endorses everything,” Riggs added. “The credit union was a great fit because he’s so down-to-earth. He ended up opening an account there.”

First CEO of Mid-Atlantic Corporate dies

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HARRISBURG, Pa. (8/19/09)--John H. Bixler Jr., the original president/CEO of the Mid-Atlantic Corporate FCU, has died, the corporate announced Tuesday. Bixler, along with former Pennsylvania Credit Union Association (PCUA) President Mike Judge, formed the template for what is now the corporate, said PCUA President/CEO Jim McCormack (Life is a Highway Aug. 18). The corporate was chartered in 1976 as Mid-Atlantic Central FCU, offering investments and loans. Bixler served as president/CEO until his retirement in 1989. Before that, he served as president of Pennsylvania Central FCU and CenPenn Rail FCU (now Blue Chip FCU). He was the 1988 recipient of PCUA's Lifetime Achievement Award as the William W. Pratt Professional of the Year. "John's commitment to the credit union movement was always evident, especially in his belief that the system is the solution to meet the needs of credit unions," said Jay Murray, Mid-Atlantic president/CEO. Funeral arrangements are pending.

Horizon FCU staff act to assist member in car crash

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HARRISBURG, Pa. (8/18/09)--Employees of Horizon FCU in Williamsport, Pa., sprang into action last week after witnessing an accident in front of the building. A member turning into the parking lot was hit from behind by a van. Several employees responded immediately to check on the drivers and one called 911 to report the incident and injuries, said the Pennsylvania Credit Union Association (PCUA) (Life is a Highway Aug. 17). The member had planned to visit the credit union to deposit her paycheck and get some cash. While she waited for police and emergency personnel to arrive, a credit union employee returned to the credit union to process her transaction. In the meantime, other employees assisted people in the van until an ambulance arrived. Another employee directed traffic around the accident scene. The driver of the van was taken to the hospital by ambulance. Everyone else was okay, the credit union told PCUA.

CU robberies totaled 117 for 2Q says FBI

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WASHINGTON (8/18/09)--Robberies at credit unions totaled 117 out of the 1,278 robberies committed at financial institutions during second quarter, according to the Federal Bureau of Investigation (FBI). Credit unions also saw six burglaries out of 19 committed, and three larcenies out of seven reported to the FBI. Overall there were 1,304 violations of the Federal Bank Robbery and Incidental Crime Statute, a decrease from 1,444 for second quarter of 2008, reported the FBI's Bank Crime Statistics Report for federally insured financial institutions. More than $9.5 million total was stolen during 1,200, or 92%, of the incidents. Twenty-eight percent of incidents reported full or partial recovery of the loot, with a total of more than $1.4 million returned to the financial institutions. Friday continued to be the most popular day for robberies, followed by Monday. The most popular times were from 9 a.m. to 11 a.m. and from 11 a.m. to 1 p.m. Acts of violence were committed in 4% of the incidents, resulting in 30 injuries, two deaths (both robbery suspects), and four hostages taken. Robbers' preferred methods during second quarter included oral demand of money in 759 incidents, demand note in 678 incidents, and threatening or implying a weapon in 531 cases. Firearms were used in 336 incidents, and handguns were part of 320 crimes. Explosive devices were used or threatened in 49 incidents. The South experienced the most robberies--430--followed by the West, with 409. States with the most robberies reported included: California, with 160 robberies; Ohio and Florida, with 65 robberies each; Illinois with 54, and Pennsylvania and Arizona tied for 52.

Hackers indicted in Heartland Hannaford breaches

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WASHINGTON (8/18/09)--Credit unions who lost funds in data breaches at major retailers and payments processors the past three years will be interested in the indictment Monday of a Miami, Fla., man and two Russian-citizen cohorts for the biggest data breaches in history: Heartland Payment Systems, Hannaford Brothers Co. and more. The Justice Department is calling the Heartland-Hannaford indictment "the single largest hacking and identity theft case ever prosecuted." The hackers stole more than 130 million credit and debit cards numbers from the Princeton, N.J.-based card processor Heartland and the Maine-based grocery chain Hannaford combined. Thousands of credit unions and other financial institutions were forced to reissue credit and debit cards whose numbers and personal information were compromised in the data thefts. The true cost to credit unions of the breaches cannot be estimated, because the card companies have the actual loss figures but never report them, said CUNA Mutual Group Media Relations Manager Phil Tschudy. "We insure most, but not all credit unions, and not all losses are reported to us because of changes we made to deductible limits." Reporting losses from only CUNA Mutual's insured credit unions would "be significantly understated and a bit misleading," he told News Now. In addition to losses, hard costs to block existing cards and reissue new ones "is probably between $2.50 and $3.50 a card, and the soft dollars related to staff hours likely eclipses those," Tschudy said. In the indictment, Albert "Segvec" Gonzalez, 28--a former Secret Service informant already awaiting trial regarding earlier breaches of discount retailer TJX Cos. and others--was the only person named by the federal grand jury in New Jersey. The indictment was unsealed Monday ( and ComputerWorld Aug. 17). The three indicted, including a person identified only as "P.T.," are charged with conspiracy and conspiracy to engage in wire-fraud. The Justice Department said the three sought out Fortune 500 companies and attempted to identify the potential vulnerabilities in the companies' computer systems. They used a sophisticated "SQL injection attack" seeking to exploit computer networks by finding a back door into a network's firewall so they could upload credit and debit card information to servers acted as hacking platforms. Gonzalez and the co-conspirators then would try to sell the data to others for fraudulent purposes, the indictment said. They used computers they leased or controlled in California, Illinois, New Jersey, Latvia, Ukraine and the Netherlands to store malicious software, launch their attacks and receive the stolen numbers. Gonzalez, if convicted on the Heartland-Hannaford breaches alone, could face up to 20 years for a wire-fraud conspiracy and an additional five for conspiracy. He also faces fines of $250,000 per charge. In May and August 2008, Gonzalez was one of 11 people charged with the breaches of TJX Cos., OfficeMax, Dave & Busters restaurants and other unnamed companies. Their trial begins next month, with jury selection set for Sept. 14. On those charges, Gonzalez faces a maximum five years in prison and possible maximum fine of $250,000 on the computer fraud charge, plus on the wire charge he faces 30 years and $1 million fine, or twice the amount gained from the offense, whichever is greater ( Aug. 17).

PCUA opposes AGs proposal to tax nonprofits

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HARRISBURG, Pa. (8/18/09)--The Pennsylvania Credit Union Association (PCUA) has sent a letter to state Auditor General Jack Wagner expressing strong opposition against one of Wagner's budget proposals: taxing non-profit entities. The suggestion is one of seven recommendations Wagner has made at least twice to the governor and General Assembly to explore during the state's budget impasse. He suggested evaluating the tax exemption and other non-profit entities as a possible funding source. "The Pennsylvania tax code is filled with tax breaks for special interests, and they should be thoroughly reviewed and either suspended, reduced, or eliminated for the duration of this crisis," Wagner said in a press release, adding that this suggestion could result in a minimum revenue gain of $100 million. In PCUA's letter, President/CEO Jim McCormack wrote that "we want to place our strong opposition on the record to your recommendation to evaluate and use tax-exempt entities as a funding source for the state budget crisis." McCormack outlined the reasons credit unions are tax-exempt financial institutions: democratic control, unpaid boards of directors, and earnings returned to members/owners in the form of increased or better products and services, dividends or other programs. "Consumers receive a 'better deal' in lower interest rates on loans and higher rates in savings due to the credit unions' cooperative structure," he said. "Credit unions focus on service to members, rather than squeezing the last dime from each and every transaction," he wrote. "Changing the tax status of credit unions would change the dynamics of the credit union business model. Earnings and profits would necessarily become a focal point rather than the current focus of providing quality services and attention at low to no cost to members and communities." He noted credit unions have hundreds of stories to illustrate how their tax-exempt status benefits residents and communities in the state. "Examples, relevant to the current state government dilemma, are the programs, voluntarily created by credit unions, to assist state employees during the state budget impasse." He outlined the loans credit unions designed to assist state employees until a state budget is passed, including 0% loans, skip-a-payment plans, and more. But he also emphasized that these efforts are "evident every day" while credit unions "fulfill their philosophy and mission of People Helping People. "All taxpayers, whether members or not, benefit from the presence of credit unions in the marketplace. Creating a tax on credit unions would disrupt the balance of market competition, but more importantly would endanger the services that they are able to provide to members and their communities," McCormack concluded.

IN.Y. TimesI discusses difficulties of attracting unbanked

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NEW YORK (8/18/09)--Despite a surge in the number of bank branches and credit unions--including a prominent credit union in the lower east side of New York City-- there still are a large number of unbanked consumers in the area, according to the The New York Times (Aug. 17). In Manhattan, 12% of households do not have an account at a financial institution, compared with a national average of 8%, according to data from the Pew Charitable Trusts. Lower East Side People’s FCU, a $22.7 million asset credit union, based in Manhattan, received its charter to open in 1986, replacing the only bank branch within a 100-block area, the newspaper said. Today, while almost every major bank has opened a branch there, the neighborhood still has one of the highest concentrations of unbanked households in Manhattan, according to Pew data. The reasons include a mistrust of financial institutions, reliance on check-cashers for cash and post offices for money orders, and the fact that many Manhattan households feel more comfortable placing their savings in pillow cases, closets and brown lunch bags than financial institutions, the paper said. In the meantime, a lower-east side restaurant owner, Humberto Vargas, has been trying for eight months to convince one of his deliverymen, Che Che Matos, to join a financial institution and build a credit history. Since Matos had bad experiences with banks and fees, Vargas suggested Matos join Lower East Side People’s FCU. However, Matos still refuses to put his money in any type of account, the paper said.

Virginia governor State employee loans pilot a success

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RICHMOND, Va. (8/18/09)--A pilot for the Virginia State Employee Loan Program--a partnership between Virginia CU (VACU) and the Commonwealth of Virginia Campaign--has been called a success after one month of operation by Gov. Tim Kaine. The program offers loans of $100 to $500 to state employees facing financial hardships. To date, it has issued $641,657 worth of loans to 1,300 state employees (M2 Presswire Aug. 15). “I believe the early success of this pilot program clearly demonstrates that there is a need for these types of loans,” Kaine said. “More important, it allows state employees the opportunity to receive small loans without having to go to predatory lenders. The success of this program demonstrates that other large employers can implement similar initiatives as a service to their own employees.” Program participants must be non-probationary state employees and members in good standing with VACU. To qualify for a loan, participants must successfully complete an online financial fitness course and a 10-question financial literacy exam. The loans carry an annual percentage rate of 24.99% and are payable over six months with no prepayment penalty. Loans are repaid through direct debit from the employee's VACU checking or savings accounts, in up to 12 semi-monthly payments. Employees can have only one loan at a time and may apply for a maximum of two loans per year. There is no credit check for loans and they are not reported to credit agencies. The $1.689 billion asset VACU is based in Richmond, Va.

CUs back-to-school projects in full swing

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MADISON, Wis. (8/18/09)--Credit unions nationwide are helping to prepare students for the start of school by collecting and distributing school supplies and other materials for those in need.
Click to view larger image Waukesha Randolph shops for back-to-school clothes with a student. Waukesha was one of 52 Virginia CU employees who shopped with schoolchildren as part of the credit union’s support for the YMCA Bright Beginnings program
Click to view larger image Virginia CU (VACU) employees, from left, Natasha McDonald-Henley, Jamie Hart and Andrea Seaborn deliver a few of the 150 backpacks of school supplies collected by VACU employees to the Downtown YMCA. (Photos provided by the Virginia Credit Union League)
Fifty-two employees of Virginia CU, Richmond, Va., helped youth shop for new back-to-school clothes at a local Target store as part of the YMCA’s Bright Beginnings program. Contributions from the community helped pay for the clothes. Virginia CU employees also donated money to stock more than 150 backpacks with school supplies for youth at the YMCA. Other credit union supply drives:
* Tempe (Ariz.) Schools CU employees donated more than 1,000 school supplies to Communities in Schools of Arizona, an organization that helps youth stay in school. The credit union also donated 75 pairs of shoes and 75 backpacks. The credit union said this year’s school supply drive was the most successful in the four years since the program was established; * Omni Community CU, Battle Creek, Mich., purchased more than 500 backpacks and invited members and area residents to donate school supplies for its annual Project Backpack program. They will be distributed to schools throughout Southeastern Michigan; and * MaPS CU, Salem, Ore., recently kicked off a school supply drive. It is encouraging members to donate supplies at MaPS CU branches for students in the Salem-Keizer School District.

Baltimore council OKs league-backed fin ed measure

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BALTIMORE (8/18/09)--The Baltimore City Council approved a financial literacy bill Aug. 10 that was supported by the Maryland and District of Columbia Credit Union Association (MDDCCUA). The bill, introduced by Rep. Helen Holton (D-8) and co-sponsored by 11 members on the council, requests that the New Board of School Commissioners and the CEO of Baltimore City Schools examine the feasibility of requiring students to pass a course in financial literacy to graduate from Baltimore City schools (FOCUS newsletter Aug. 17). MDDCCUA supports the measure and hopes it will continue to facilitate a dialogue between community leaders, education leaders, legislators and community residents regarding the importance of financial literacy education. In July, MDDCCUA Vice President of Legislative Affairs Brian Tate testified in support of the resolution before the Baltimore City Council Education Subcommittee. Dorothea Stierhoff, Municipal Employees CU of Baltimore public affairs specialist, also testified in support. MDDCCUA said it continues to monitor the issue and will provide updates on future developments.

Ex-CEO of largest British CU under embezzlement probe

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YORKSHIRE, England (8/17/09)--The former CEO of the United Kingdom's largest credit union has declared bankruptcy, and an internal investigation for embezzlement has been turned over to the West Yorkshire police. Sue Davenport, former CEO of Leeds City CU (LCCU), was granted bankruptcy at Leeds County Court (Yorkshire Post Aug. 14). Among the creditors owed was the credit union. Police are investigating allegations that she used the credit union's company card for personal expenses, made loans without following approval procedures, and changed balances in credit union members' accounts before she was forced to resign last year by regulators (News Now April 8, 2008, and Nov. 6, 2007). LCCU has 24,000 members and manages about US$49.6 million in assets. The credit union received a $6.6 million bailout from public funds earlier this year.

iConsumer Affairsi Firing the bank Try CUs

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NEW YORK (8/17/09)--Consumers who've had rates raised, accounts closed and fees imposed may want to fire their banks, and one practical option is credit unions, says a columnist with Consumer Affairs (Aug. 12). Mark Huffman. writing on Consumer Affairs' website, says the site has received a "cascade of complaints" about major banks. He asks the question: Is it possible to exist in the 21st century without doing business with a bank? His answer: Maybe, because there do appear to be some alternatives. "Credit unions may provide a more practical alternative to banks, providing many of the same services but without the policies that seem to drive consumers up the wall," wrote Huffman. "They tend to charge…members lower rates when they borrow money and often higher rates on their savings. Like banks, most are federally insured." He discusses the history of credit unions and notes they "tend to be more stable. Since they are membership organizations, they aren't sold and rarely merge with other financial institutions. Some members find that gives them a feeling of safety and security they don't get with a bank." He discusses how to join a credit union, says credit unions have expanded membership so it's easier to join, and notes the Credit Union National Association's website to help consumers searching for a credit union to join.

CU teller picked to vie for Montana legislative seat

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ANACONDA, Mont. (8/17/09)--A head teller at Southwest Montana Community FCU, Anaconda, Mont., is one of three finalists chosen by Democrats to campaign for the seat of state Rep. Dan Villa in District 86. Kathy Keenan-Swanson, who works in the Anaconda branch of the $71 million asset credit union, will run against former state legislator Red Menahan of Anaconda and Jim Jenner, a video production company owner from Philipsburg (The Montana Standard Aug. 12). Others vying for the position are John Collins, Jim Flynn and Kelly Richards. Precinct members from Anaconda-Deer Lodge and Granite counties at a Tuesday meeting in Philipsburg asked questions and listened to the biographies of six candidates. The most votes went to Jenner, Kennan-Swanson and Menahan. They will have to wait for the counties to choose one to represent the district. Once chosen, the term will be open for election in November, said the newspaper. Keenan-Swanson, who has served on the county's tax appeal, zoning and planning boards, is the daughter of former state Sen. P.J. "Squeek" Keenan. Her daughter, Dayna works for U.S. Sen. Jon Tester. Her sister, Nancy Keegan, is a former Montana legislator and former school superintendent, and ran unsuccessfully for Montana's lone seat in the U.S. House of Representatives. The seat is open because Villa was appointed in June by Gov. Brian Schweitzer as his education policy adviser.

California to redeem IOUs early

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SACRAMENTO, Calif. (8/17/09)--California will stop issuing IOUs on Sept. 4, well before the planned redemption date of Oct. 2, state Controller John Chiang announced Thursday. That's good news for more than 80 credit unions and their state-employee members who were impacted by this summer's state budget stalemate. Chiang said the IOUs--called registered warrants--will be redeemed early because the state's revised budget will replenish its coffers (The Wall Street Journal Aug. 14). The state started issuing the warrants as payments to creditors--instead of using cash--to avoid running out of money by the end of July. It said it would repay the IOUs with interest when it had a budget. The warrants pay a 3.75% annualized interest rate. A $1,000 IOU would pay about $6.70 in interest at most. To assist their members who were state employees working without pay, more than 80 credit unions in the state agreed to accept the IOUs indefinitely. Credit unions were applauded by regulators and others for their assistance, and they became the topic of a number of positive media reports for their efforts. Several large banks, on the other hand, generated themselves a barrage of negative publicity for announcing they would not accept the warrants or for putting a mid-July deadline on acceptance. On July 20, state lawmakers and Gov. Arnold Schwarzenegger reached an agreement that closed a $24 billion deficit (News Now July 27). The state issued 327,000 IOUs, worth $1.95 billion. Chiang said it was possible that officials could issue IOUs again later this year if the state's economy worsens. The IOUs can be redeemed at the Treasurer's office beginning Sept. 4.

Maine CUs thriving says public broadcaster

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AUGUSTA, Maine (8/17/09)--Maine credit unions are thriving as evidenced by reported increases in membership, deposits and loan approvals, said the Maine Public Broadcasting Network (MPBN) in a radio segment originally aired Thursday. Membership in Maine’s 67 credit unions has grown slightly more than 1% in the past six months. In the past year, there has been a 4% increase in loans issued and an 8% rise in deposits, MPBN said. The statistics indicate that consumers in the state like the fact that credit unions are member owned and don’t get involved with risky investments, John Murphy, president of the Maine Credit Union League, told MPBN. “If you think back to last fall, people were concerned about the safety and soundness of their funds and their financial institution, and credit unions provide the latest financial service for consumers--there are many locations through the shared branch network,” Murphy said. “So credit unions become a real viable, good option.” In many cases, credit unions offer the best interest rates, Gerard Cassidy, a director at RBC Capital Markets in Portland, Maine, told MPBN. “Credit unions tend to pay a little better interest rate than a commercial bank or a savings bank because most credit unions are not-for-profit and they’re able to offer a more attractive deposit yield than a commercial bank that may be publicly traded or owned by a publicly traded company,” he added. Also, credit unions now are easier to join than in the past when they were exclusively for smaller groups of employees of companies, universities and other organizations, Cassidy told MPBN.

Amended Ill. CU Act changes accounting mortgages marketing

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NAPERVILLE, Ill. (8/17/09)--An amendment to the Illinois Credit Union Act that affects credit unions’ accounting, mortgages and marketing was signed into law by Gov. Patrick Quinn Aug. 7. It was initiated by the Illinois Credit Union League. The bill--Illinois House Bill 348--addresses issues regarding loan loss accounting, U.S. Department of Agriculture (USDA) Rural Development Housing and Community Facilities Program (HCFP) guaranteed residential mortgage loans, and marketing of services to persons eligible for membership. “This is the second bill that the governor signed this year in support of credit unions,” Keith Sias, league director of state government affairs, told News Now. “This bill has three important amendments to the Illinois Credit Union Act. I think it shows the good year we had in the legislature and in terms of support from the governor. “A previous bill that passed in January implemented a settlement of regulatory-fee litigation and immediately gave $4.5 million back to Illinois credit unions,” he continued. “So it’s been a great year for Illinois credit unions.” H.B. 348 also provides state-chartered credit unions parity with federal credit unions doing business in Illinois. H.B. 348 authorizes state-chartered credit unions to use generally accepted accounting principles (GAAP) methodology for loan loss accounting, subject to an external auditor’s determination that the period is in accordance with GAAP. The credit union must establish that a time period of fewer than five years is appropriate given the credit union’s size, business strategy, loan portfolio characteristics, and the economic environment of the areas and employers its serves. Currently, all Illinois credit unions are required to determine their historical loss rate using a period of five years. For some, this requirement distorts the forecast of current losses. Except for state-chartered credit unions, all other financial institutions, including federal credit unions, determine the appropriate balance in the allowance for loan losses in accordance with GAAP principles, as set forth in Financial Accounting Standard 5 (FAS 5). FAS 5 authorizes setting a period that may be shorter than five years. Particularly in this time of volatile market conditions, this provision is critical so that Illinois-chartered credit unions can accurately reflect the amount of losses they are likely to incur, the league said. The amended law also authorizes Illinois credit unions to provide limited services for persons eligible for membership in but not currently members of the credit union. They include (1) the issuance of negotiable checks (including travelers checks), money orders, and similar money transfer instruments (including electronic fund transfers) and (2) the ability to cash checks and money orders and receive electronic fund transfers for a fee. Illinois credit unions can now better promote membership by demonstrating a limited sampling of selected services to potential members in their existing field of membership. They also can serve unbanked persons residing in economically disadvantaged areas of Illinois. H.B. 348 also authorizes Illinois credit unions to participate in the no-down-payment HCFP programs. Prior to the amended law, Illinois credit unions were previously prohibited from making a residential real estate first mortgage loan that exceeds the estimated market value or appraised value of real estate securing the loan. As a result, Illinois credit unions could not fully participate in USDA HCFP. The purpose of HCFP is to bring home ownership opportunities to rural Americans. A common barrier to home ownership is a lack of funds for a down payment. The USDA program underwriting criteria ensure that prudent loans are generated to families that may not have a large enough down payment to avoid private mortgage insurance, but who otherwise have the credit histories and income ratios to support monthly debt service expenses.

Birmingham CUs top banks on ratings

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BIRMINGHAM, Ala. (8/17/09)--Birmingham, Ala.-area credit unions were rated higher than their banking counterparts, according to recent reports from two Florida-based rating agencies. Fourteen of 39 metro Birmingham, Ala.-area credit unions received five stars, the highest rating. Thirteen credit unions received four stars, which indicates excellent or sound financial performance (The Birmingham News Aug. 14). Of the 27 area banks, two received five-star ratings and four received four-star ratings. Of the 39 credit unions, four received one or zero stars, while 11 of the 27 area banks received zero or one star. The ratings were issued by and Bauer Financial. Credit unions are faring better than banks because they are avoiding risky residential loans, John Kottmeyer, Samford University economics professor, told the newspaper. Greg McBride, senior research analyst, said Birmingham credit unions are performing better than others nationally. However, Birmingham credit unions are not immune to the nation’s economic troubles. Many credit unions are being hurt by loan defaults triggered by job loss. The jobless rate in Birmingham has doubled to 10.1% as of June, McBride added. Credit card, personal loan and small-business loan defaults also could hurt the nation’s financial institutions, and even credit unions won’t be immune, Kottmeyer added.

GTE FCU youth account features social networking

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TAMPA, Fla. (8/17/09)--GTE FCU in Tampa, Fla., is integrating social networking with its U22 savings account on MySpace, Facebook and Twitter to reach 12- to 22-year-olds. U22 is a youth savings account that offers accountholders educational materials, online articles about personal finance, a debit card with rewards points, online and mobile account access, free bill pay, and one overdraft fee forgiveness per month. GTE is encouraging youth to sign up as a friend of U22 on MySpace and Facebook by Aug. 31. Those who do will be entered into drawings for prizes, including tickets to a Blink 182 rock concert. All U22 accountholders who sign up by Sept. 5 will receive two Tampa Bay Rays minor league baseball tickets and a chance to meet third baseman Evan Longoria. Longoria is one of three spokespeople for the U22 account. Caroline Kudelko, a local singer and songwriter, and aspiring actor Alex Perez, who was chosen by GTE through a casting call to represent the credit union, are the other two spokespeople. They will update U22 accountholders and the public on their activities and the pursuit of their financial goals through blogs and videos on the U22 website. Ads featuring Perez began running Thursday on Tampa Bay-area radio, TV stations, and billboards, GTE said. The $1.8 billion-asset credit union also created a character, “Kathy,” who will appear on the website to provide tips on money management.

CU System briefs (08/14/2009)

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*ALBANY, N.Y. (8/17/09)--The Credit Union Association of New York's annual auction has raised nearly $7,000 for political advocacy. More than 300 credit union people surveyed more than 70 items up for bid, including iPods, jewelry, elaborate baskets and tickets to sporting events. Hot items at the event were orchestra tickets to see "West Side Story" on Broadway and a painting of a lighthouse on the Hudson River. "Charitable events like this auction are a great way to raise political awareness among credit unions," said Cheryl Frantzen, the association's political action coordinator. In the photo, Mario Shortino, board member from Teachers FCU, Farmingville, takes time out from the evening's festivities to bid on one of the items.(Photo provided by the Credit Union Association of New York) … * RIVERTON, Utah (8/17/09)--Even robbers can be impressed with a credit union's services. A man with manners and a semi-automatic handgun in the waistband of his pants robbed a Riverton branch of Sandy, Utah-based Jordan FCU Wednesday, thanking tellers as he took their money. The robbery occurred at about 3:30 p.m. Wednesday. He walked into the $194 million asset credit union, told everyone not to panic and approached two tellers. After he took the money, he thanked the tellers for "doing a good job." The Salt Lake County Sheriff's Office believes he fled on foot (Deseret News Aug. 13) … * REDWOOD CITY, Calif. (8/17/09)--A San Mateo, Calif. bride-to-be spent what would have been her wedding night in jail after being charged with stealing $35,000 from San Mateo CU to finance her wedding. Briana Nicole Balancier, 26, pleaded no contest Tuesday to forgery, grand theft and commercial burglary in exchange for avoiding a state prison sentence, said a prosecutor. She faces up to nine months in county jail, but may get a reduced sentence if she pays back the money before her Oct. 9 sentencing. In March she deposited a check for $35,000 drawn from her day care business into her credit union account. A few days later she tried to withdraw some funds, and the credit union told her there was an 11-day hold while the check cleared. That same day, Balancier wrote a phony letter from a bank, saying the check was good. and faxed it to the credit union. During the next two days she withdrew $20,000 to cover wedding expenses. When the check bounced, officials called the police. She was arrested March 19, two days before the wedding date ( Aug. 12 and CBS News Aug. 13) … * WILLISTON, Vt. (8/17/09)--New England FCU (NEFCU) CEO David T Bard will retire, effective
. in January, announced Geoff Akiki, board chair of the $740 million asset credit union based in Williston, Vt. Bard will be succeeded by NEFCU President/Chief Operating Officer (COO) John J. Dwyer Jr. Bard has been CEO since 1986, when the credit union employed 30 people in a single branch, had $48 million in assets and less than $10 million in serviced first mortgages. Today NEFCU has 170 employees in six counties with seven branches, has surpassed $740 million in assets, and has more than $1 billion in serviced mortgages, making it one of the . It is one of the top 50 credit unions in the U.S. for first mortgage balances. At the end of 2008 NEFCU enjoyed a capital-to-assets ratio in excess of 10%. As part of a carefully planned transition, Dwyer, who has been with NEFCU since 1987, became president/COO in 2006. He has held a variety of positions of increasing responsibility at NEFCU. Prior to that he was a certified public accountant with KPMG in Boston …

Missouri CUs targeting REAL Solutions to youth

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ST. LOUIS (8/17/09)--Missouri credit unions heard from college students on how to better reach and retain youth members during a REAL Solutions workshop in Jefferson City Aug. 11, according to the Missouri Credit Union Association.
REAL Solutions participants discussed ways to gain and retain young members, with the help of Columbia, Mo.-based Tigers CU volunteers and staff, during a workshop Aug. 11 in Missouri. (Photo provided by the Missouri Credit Union Association)
Volunteers and staff from Tigers CU, a student-run credit union on the University of Missouri Columbia campus, shared their perspectives (The Missouri difference Aug. 14). "People our age like to get involved in a cause," said Jesse Bunse, a Tigers CU intern. "If credit unions could make that connection with young people on how credit unions are different and how they help people, students would be more likely to become a credit union member." Other Tigers representatives included Kelley Winfrey, Mandi Moutray, Kent Higginbotham and Program Director Laura Royse. According to a survey of potential credit union members conducted by the Credit Union National Association, the highest percentage of potential members is in the 18- to 34-year-old range. Much of the borrowing done by young adults starts before they are 21 years old. By age 25, young members are unlikely to change their existing financial institution. "As soon as I got a job at 16, I was opening a checking account," said Winfrey. "You need to catch students before they get to that point, and make sure they think of the credit union as an option." Workshop participants also learned about youth target programs taking place across the nation from Nancy Pierce of Tipton Research Group, who works on REAL Solutions projects nationwide. REAL stands for Relevant, Effective, Asset-building, and Loyalty-producing. REAL Solutions is a program of the National Credit Union Foundation. "While I am still at a loss at the best media to reach them [youth], because I don't think there is one great answer, I now feel like I am more equipped to know what products interest them and what drives their expectations," said Heather DeMint, marketing manager for United CU, Mexico, Mo. In addition to United CU, other credit unions attending were Anheuser-Busch Employees' CU, Electro Savings CU and Neighbors CU, all of St. Louis, and United Consumers CU, Independence.

SEC files complaint vs. SandL with CU in Sweden

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NEW YORK (8/14/09)--The Securities and Exchange Commission (SEC) has charged two California residents and two companies--including an unlicensed savings and loan association that is also registered in Sweden as a "sparkassa" or credit union--with operating a Ponzi scheme that netted them $9 million from investors in four states. The SEC charged Bich Quyen Nguyen, 55, of Los Gatos, Calif.; Johnny E. Johnson, address unknown; and their entities, Sun Group and Sun Investment Savings and Loan, with securities fraud related to a multi-level marketing scheme. In the scheme, they promised returns of $35,000 a month on a $4,995 investment, according to a SEC filing May 13 in the U.S. District Court for the Central District of California. The fraud allegedly occurred from at least June 2008 to May 2009. The SEC had previously charged two other entities, Empire Capital Asset Management (ECAM) and Sun Empire, and two individuals--Delilah A.Proctor, 57, Corona, Calif., and Shauntel McCoy, 36, Fontana, Calif.--with participating in the scheme. In the filing, SEC charged they misused investors' funds for their own personal use or sent money to other entities they operated, and failed to pay investors the returns promised. The scheme solicited hundreds of investors in California, Nevada, Texas and Arizona. They offered certificates of deposit with returns as high as 10% to 19.30%. SEC obtained an emergency court order to freeze the assets of the defendants and their companies and halt the scheme, according to a press release.

CU System briefs (08/13/2009)

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* ANCHORAGE, Alaska (8/14/09)--A man approached a teller at an Alaska USA branch Friday, inquiring about the balance in his account. He provided his name, account number and photo ID. Then he handed over a receipt with a note on the back that said he had a gun and demanded money. The robber escaped with $600. Police used the information he provided to nab him Monday. Jarell Paul Arnold, 34, of Anchorage, is in custody on federal bank robbery charges (Associated Press Newswires Aug. 13) … * DUBLIN (8/14/09)--New rules requiring Ireland's credit unions to set aside 10% of their assets as reserves will go into effect Sept. 30. The rule will make it easier for the country's 419 credit unions to pay interest on a dividend (savings). The rule originally was opposed by the Irish League of Credit Unions and another association, who said smaller credit unions would be unable to pay a dividend if they were forced to keep the funds as reserves. The league negotiated more flexible rules, winning an extension for smaller credit unions. They will have five years to reach the 10% reserve ratio (Irish Independent Aug. 13) … * SYDNEY, Australia (8/14/09)--A merger of two South Australia credit unions will create a A$7 billion (US$5.87 billion) asset credit union. Savings & Loan CU and Australian Central CU announced the plan to merge, pending member approval. Members of the credit unions will vote in November on the proposal. Both boards have approved the merger. The two credit unions said there will be redundancies but job losses will be kept to a minimum. They have guaranteed the jobs of all member service staff ( Aug. 13) …

WOCCU Remittances volume drop will affect pricing

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MADISON, Wis. (8/14/09)--Remittances to Latin American countries are expected to decline this year, making pricing for the services more competitive, according to the World Council of Credit Unions (WOCCU). The Wall Street Journal Wednesday reported that remittances are expected to drop 11%, to $62 billion. WOCCU offers remittance services through IRNet, a remittance service operated by WOCCU Services Group. It is doing its best to adjust to declining remittance volume, according to Saul Wolf, WOCCU remittances manager. “As total volumes drop, pricing is becoming more competitive,” Wolf told News Now. “Today, IRNet’s 1,000-plus credit union members in the U.S. and internationally are increasingly able to deliver the same quality service at lower costs to our members due to the fact our intermediary costs are dropping as well. “This is important because remittances generally fund daily necessities like food and shelter,” he continued. “Thus, lower intermediary costs mean more money for necessities for both remittance senders and receivers, people who need it most.” About 108 U.S. credit unions participate in WOCCU's IRNet. The service sends remittances in eight countries and has sent 157,000 transactions, valued at $86 million, since its inception in 2001, Wolf said. The Wall Street Journal article noted that last year, immigrants averaged 15 money transfers per year. This year, the expected figure is 12. The amount sent in transfers is expected to average $230, down from $241.

Scammers try to horn in on clunkers program

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WASHINGTON (8/14/09)--The Credit Union National Association (CUNA) is warning credit unions to educate their members about scammers seeking to take advantage of the recently renewed Cash for Clunkers program. The Better Business Bureau (BBB) has reported that identity thieves are using the program to skim sensitive information from consumers. The National Highway Traffic Safety Administration, prior to the passage of the Cash for Clunkers legislation earlier this year, reported websites that were soliciting for the names, addresses and Social Security numbers of potential customers, said BBB. Consumers also reportedly have been solicited by companies that offer to help fill out the paperwork needed to receive vouchers to take part in the program. The BBB has informed potential program participants that they do not need to register or receive a voucher to participate in the Cash for Clunkers program. Also, auto dealerships, not individuals, are responsible for filling out any paperwork associated with the program. The program, which gives car buyers up to $4,500 for trading in older, gas-guzzling vehicles for more fuel-efficient cars, was responsible for an estimated 250,000 new car sales in July. The BBB recommends that interested participants consult the official government site for the program,, to answer any questions they may have. CUNA has also provided information on the program, entitled "Understand Clunkers Program--Vouchers for Fuel-Friendly Cars", in its Home & Family Finance Resource Center.

Council paper CUs need employees engagement

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MADISON, Wis. (8/14/09)--As the financial services environment continues to become increasingly complex, competitive and crowded, engaged employees are the critical ingredient for credit union success, says a new CUNA Human Resources and Training and Development (HR/TD) Council white paper. “Employee Engagement” presents strategies credit unions can use to engage their employees during the current economic downturn and during an expansion. The paper underscores the need to tap into the discretionary energy that all employees possess, noting that many employees are working up to only part of their potential. Employee surveys indicate that there is a strong desire for management to communicate more, not less, to employees--who are seeking more opportunities to communicate and have a say in the decisions that affect their daily work lives. Credit unions can strengthen employee engagement by developing and nurturing a culture of transparency, says the council’s paper. The paper also explains how to establish a learning environment, use internal or social networks, conduct employee surveys, and looks at important aspects of the supervisor-employee relationship. For more information, use the links.

Irish league pushes for new regulator in report

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DUBLIN (8/14/09)--The Irish League of Credit Unions (ILCU) said credit unions in Northern Ireland could miss out on a generation of members if a recommendation to move Ireland's credit unions under the regulation of the Financial Services Authority (FSA) doesn't move through the legislative process. Currently credit unions in Ireland are regulated by DETI Companies Registry (The Irish News Aug. 12). They hope to move to FSA, like credit unions in Britain, to widen the range of products and services they can offer. British credit unions can offer a range of service including current accounts, Internet and telephone banking, electronic transfer of wages, ATMs, debit cards and bill payments. They also can participate in government savings initiatives, said the article. ILCU Northern Committee member Kevin Helferty said the inability to participate in government savings initiatives puts credit unions at a disadvantage to other financial institutions in the north. The league's comments were made at the launch of its "Investing in our Future" report on current and potential credit union services. It found that one in three people in Northern Ireland were members of a credit union.

Study CUs prices better than Sub-S C-corp banks

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MADISON, Wis. (8/14/09)--Credit unions have better savings and loan rates than Subchapter-S banks and C corporation banks, according to a Filene Research Institute Study.
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The study, “A Comparison of Bank and Credit Union Pricing: Implications for Tax Benefits of Subchapter S Incorporation,” by Steve Swidler, Auburn University professor, examines the rate differences between banks and credit unions. Swidler found that credit union members benefit both on the deposit and loan side for almost every product category, compared to C corporation and Sub-S banks. Sub-S banks pass on few, if any, tax benefits to customers in the form of better rates. Sub-S banks set rates similar to C coporations. Banks incorporating as Sub-S eliminate federal taxes on corporate level earnings. Sub-S banks are profit-oriented, while credit unions receive a tax benefit to serve the needs of everyday people, the study said.

Filene report 12485 CU mergers from 1971-2008

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MADISON, Wis. (8/14/09)--The pace and types of credit union consolidation will increase over the next several years, according to a recent Filene Research Institute report that examines merger activity.
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The study, “Characteristics of Credit Union Mergers: 1984-2008,” analyzes a database of credit union mergers from 1984 to the present. Researchers Luis G. Dupico and James A. Wilcox found that about 12,485 credit union mergers took place between 1971 and 2008--which translates to 2.3% of credit unions per year. The number of credit unions peaked at 23,866 in 1969, compared with 8,147 in 2008. During 1984-2008, credit union mergers transferred members and assets from institutions that didn’t perform as well as peer institutions on average. The assets of the target credit unions totaled $37.3 billion during 1984-2008. The report also touches on the influence of events such as the savings and loan crisis, regulatory changes, and the 1980 recession. “Credit union mergers are unlikely to fade away in the foreseeable future,” said Filene Chief Research Officer George Hofheimer. “Competitive, economic and regulatory factors all point toward a more intense external environment.”

Meeting addresses Desjardins model U.S. collaboration

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NEW YORK (8/14/09)--Credit union leaders nationwide gathered in New York City for an event last week that focused on Canada’s Desjardins cooperative credit union model and the potential of further collaboration within the U.S.
Click to view larger image Credit union representatives recently gathered to discuss Canada’s Desjardins credit union model and its applications in the U.S. From left are: Kirk Kordeleski, president/CEO, Bethpage FCU; Tom Dorety, CEO, Suncoast Schools FCU; Paul Gentile, president, New Jersey Credit Union League; Kelly Bloss, senior consultant, Stuart Levine and Associates; Tom Sargent, CEO, First Tech CU; Lucie Bouchard, Desjardins Group; and Stuart Levine, chairman/CEO, Stuart Levine and Associates. (Photo provided by the New Jersey Credit Union League)
The event was hosted by Stuart Levine and Associates, a strategic planning and merger consulting provider. Lucie Bouchard from the Desjardins Group in Montreal and Stuart Levine, chairman/CEO of Levine and Associates, spoke at the event. Paul Gentile, New Jersey Credit Union League president/CEO; Tom Sargent, CEO, First Tech CU, Beaverton, Ore.; Tom Dorety, CEO, Suncoast Schools FCU, Tampa, Fla.; and Kirk Kordeleski, president/CEO of Bethpage (N.Y.) FCU, also attended. The Desjardins model is recognized as more cooperative than the U.S. The discussion centered on understanding the Desjardins model to increase member value and reduce costs to individual credit unions and leagues in the U.S. The group also discussed standardization, which is a key component of the Desjardins model. In Canada, members can visit any credit union and be treated as they would at their hometown credit union--similar to the shared-branching concept in the U.S. Canada, however, takes this a step further through standardized products with standard pricing, Bouchard said. The current financial crisis will drive consolidation, Bouchard added. Attendees agreed that the current global crisis should and will facilitate the merger of credit unions that will succeed in the economic climate. In order to fully represent each credit union, its members and board, an independent arbitrator can facilitate the merger process to ensure that the strengths of each credit union are evaluated to formulate a new credit union that represents the best for both organizations, Levine said. He also stressed the importance of collecting data and conducting criteria-based performance evaluations of the board of directors, which is not punitive, to determine board effectiveness.

Better Choice has saved consumers 6.7 million

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HARRISBURG, Pa. (8/14/09)--Credit unions have issued more than 20,000 loans, for a total of $9.3 million since the Credit Union Better Choice payday loan alternative program began in 2006. By using the credit union option instead of payday lenders, consumers saved $6.7 million in the process. Since the program began, 82 credit unions with 215 locations have offered the program, with additional participants continuing to sign on, the Pennsylvania Credit Union Association (PCUA) announced Thursday. During the first six months of 2009, the program loaned 5,291 loans totaling $2.5 million, PCUA said. Pennsylvania consumers saved an average 80 cents in loan fees and costs for every dollar borrowed through the program. In addition to the $6.7 million saved from fees, borrowers placed $937,281 into savings accounts for future needs. "When consumers are in need of cash, credit unions have stepped in to fill this void with affordable short-term loans," said Jim McCormack, PCUA president/CEO. He noted the credit unions are offering financial coaching to borrowers to help them budget and manage money. The program is a partnership between PCUA and the Pennsylvania Treasury Department. It will be the topic of the next "Pennsylvania Newsmakers" program airing across the state. Keith Welks, deputy state treasurer, and Mike Wishnow, PCUA senior vice president of communications and marketing, are featured explaining the results of the Credit Union Better Choice program and how it has helped state employees who faced payless paydays last month during the state's budget impasse.

Four CUs win tech council Best Practices awards

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MADISON, Wis. (8/14/09)--Winners of the 2009 CUNA Technology Council Best Practices Awards included Tinker FCU, State Employees CU, Nassau Financial FCU and Envision CU. The awards were presented at the Council’s 14th Annual Summit, Aug. 5-8 in San Francisco.
Click to view larger image Team members at Nassau Financial FCU responsible for winning the Sales Management/Marketing Automation Award during CUNA Technology Council Best Practices Awards at the council’s 14th Annual Summit, Aug. 5-8 in San Francisco, are, from left, Frank Cordano, CEO; Lisa Peterson, information technology manager; Eileen Friel, marketing central information file systems consultant; and Regina Esernio, marketing manager. (Photo provided by CUNA Technology Council)
The CUNA Technology Council award recognizes outstanding approaches to technology challenges with potential for universal application throughout the credit union movement in four major categories. The categories and winners are:
* Technology Infrastructure--Tinker FCU, Tinker AFB, Okla., for the virtualization and storage area networking of its core processing system; * Information Security/Privacy--State Employees CU, Raleigh, N.C., for its member photo ID program; * Sales Management/Marketing Automation--Nassau Financial FCU, Westbury, N.Y., for its in-house marketing central information file and core-processing solution to determine household identity/member segmentation; and * Miscellaneous--Envision CU, Tallahassee, Fla., for using technologies which resulted in increased efficiencies, including a centralized data-conversion utility interface for its “legacy” data processing system; an automated and more streamlined coin and currency ordering process; and a new tool for trend analysis and account research in general ledger accounts.
Winners were selected, based on strategy, process, application and results, without regard to credit union asset size. The council also awarded three honorable mentions in these categories:
* Technology Infrastructure--Forum CU in Indianapolis, Ind., for its interactive intelligence program, and Technology CU, San Jose, Calif., for a new online banking administrative tool; and * Sales Management/ Marketing Automation--Beehive FCU, Rexburg, Idaho, for its in-branch video display software switching system.
For more information, use the link.

Tech CU modifies 10M in distressed homeowners loans

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SAN JOSE, Calif., (8/13/09)--Technology CU has modified more than $10 million in mortgage loans for homeowners since it accelerated its efforts two years ago to assist members in financial difficulty. The $1.2 billion asset credit union implemented a number of payment relief options for members and has helped modify nearly $2.2 million in auto loans. Its team of specialists are specifically dedicated to working with members to explore workout options. "Our focus in a loan modification is affordability and sustainability, and our specialists are trained to work with members to develop loan modification options that will ensure long-term success," said David Luu, assistant vice president of Tech CU's loan adjustment department. The number of default notices issued in California increased 2% in the second quarter, compared with second-quarter 2008, according to DataQuick. That indicates the number of homeowners falling behind on their payments is still rising. Foreclosure resales accounted for more than 50% of all California resale activity during second quarter--up from 40% for the same period in 2008, DataQuick said. "We know that many families are in crisis in terms of their ability to pay their bills," said Luu. "Tech CU is committed to preserving home ownership for members when it is legitimately possible to work out a payment reduction plan." He noted the credit union's courteous and prompt response is in contrast to many large, national financial institutions that are backlogged with borrowers requesting loan modifications. Members do not have to make repeated calls trying to get through to the credit union, and the team adheres to a philosophy of treating every inquiring member with dignity. The loan modifications are free. The Tech CU blog,, offers tips on avoiding foreclosure rescue schemes and other resources.

CU System briefs (08/12/2009)

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* HIGHTSTOWN, N.J. (8/13/09)--The New Jersey Credit Union Foundation recently provided a $12,000 grant to the New Jersey Coalition for Financial Education. The grant will provide 15 financial education classes in partnerships with credit unions statewide, according to the New Jersey Credit Union League (The Daily Exchange Aug. 11). A list of classes will be available at the end of the month. A new class, Managing Money in Tough Times, also will be offered. Registration ends Sept. 15 ... * NORTH CHARLESTON, S.C. (8/13/09)--South Carolina FCU will close a branch near Charleston Southern University, North Charleston, to reduce costs, the $1.445 billion asset credit union said Tuesday. The last day the branch will be open is Sept. 25. The ATM at that location will remain operational. Impacted employees will be reassigned to other branch locations. The branch, which opened in February 2005, serves about 2,000 members, the North Charleston-based credit union said. Five other branches are located within a seven-mile radius of the university, the credit union added (The State Aug. 12) … * MINNEAPOLIS, Minn. (8/13/09)--Teacher FCU, based in Plymouth, Minn., changed its name to TruStone Financial, with the help of brand naming company Strategic Name Development. The change signifies the solid foundation of the credit union's 70-year history with its teacher members. TruStone will maintain its dedication to teachers while shifting from being a credit union just for teachers to a credit union that teaches …

International remittances expected to drop

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NEW YORK (8/13/09)--Credit unions may want to note that Latin American remittances are expected to drop 11% this year because of the global recession and fewer job opportunities for immigrants, according to the Wall Street Journal. Remittances are likely to be $62 billion this year, down from $69 billion last year. The decline is the first drop in global remittances to the region since the Inter-American Development Bank began tracking remittance data 10 years ago. Last year, immigrants averaged 15 money transfers per year. This year, the expected figure is 12. The amount sent in transfers is expected to average $230, down from $241, the newspaper said. Many credit unions offer remittance services to Hispanics. In May, News Now reported that remittances to the Caribbean and Latin America would likely decline this year for the first time in a decade. The trend will impact credit unions, according to the World Council of Credit Unions (WOCCU). About 109 U.S. credit unions participate in WOCCU’s IRNet, a remittance service operated by WOCCU Services Group. The service sends remittances in eight countries and has sent 148,000 transactions, valued at $80 million, since its inception in 2001 (News Now May 21).

Former CU officials seek injunction vs. conservatorship

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BIRMINGHAM, Ala. (8/13/09)--The former board and CEO of Mutual Savings CU in Birmingham, Ala., Monday filed a request for a temporary injunction to stop its conservatorship. The credit union was placed in conservatorship July 31 by the Alabama Credit Union Administration (ACUA). A hearing was scheduled for Aug. 24 in the Jefferson County Circuit Court in Alabama, Patrick La Pine, League of Southeastern Credit Unions president/CEO, told News Now> “The burden will fall on the regulator to justify the conservatorship,” he said. The league is not involved with the injunction. “We’re staying neutral,” La Pine said. “We’re just monitoring the situation.” Glenn Latham, ACUA administrator, told News Now that the judge will have to determine whether the conservatorship should continue. The credit union is still operating, although its former board, CEO and supervisory committee were relieved of their duties. The senior staff remains, he said. “Nobody’s going to lose any money, and member services have not suffered,” Latham added. Mutual Savings CU had suffered some losses prior to being placed into conservatorship, he said. League President La Pine said the last quarterly call report indicated that Mutual Savings CU had a capital level of 8%. The recommended capital threshold is 7%.

Bankers Association attorney named top Florida regulator

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TALLAHASSEE, Fla. (8/13/09)--A man who served 25 years as general counsel to the Florida Bankers Association has been appointed Florida's commissioner of the state Office of Financial Regulation, which oversees credit unions and other financial institutions. J. Thomas Cardwell was appointed Tuesday by the Financial Services Commission, comprised of Gov. Charlie Crist and the state Cabinet. He will succeed Linda Charity, who was acting commissioner since May 27 (Jacksonville Business Journal Aug. 11). Cardwell also served as CEO of Akerman Senterfiit, one of the state's largest firms. He chaired the law firm's financial institutions practice. In March, he was named to the Florida Supreme Court's Mortgage Foreclosure Task Force, which will make recommendations about court dealings with the mortgage foreclosure crisis in Florida ( Aug. 12. According to Amy Jowers, vice president of communications in the Tallahassee office of the League of Southeastern Credit Unions, the league has no history involving Cardwell since 2002 when she joined the Florida Credit Union League. "Mr. Cardwell has stated that he intends to enforce the laws fairly," Jowers told News Now. "We expect nothing less since the purpose of his position and OFR is to ensure the protection of Florida's consumers against financial fraud with the consumers' best interests in mind." Florida Chief Financial Officer Alex Sink said Tuesday she expects Cardwell to "bring a strong enforcement mentality and responsible approach to" the office (The Miami Herald Aug. 12). Rep. Scott Randolph (D-Orlando) who serves on the Finance and Tax Council, questioned whether a banking industry advocate could act on behalf of consumers, noting that the banking industry has been an opponent to some of the most basic consumer-protection reforms. The position became vacant 11 months ago when Don Saxon was forced to resign. A series in The Miami Herald revealed that the agency had failed to perform required background checks for mortgage brokers and allowed criminals--including bank robbers, embezzlers and convicted racketeers--to work as mortgage brokers and fleece consumers during the mortgage boom. Cardwell said his only priority for now is to ensure the office operates competently and fairly.

MDDCCUA CEOs letter on courtesy pay in IUSA TODAYI

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NEW YORK (8/13/09)--A letter in Wednesday's USA TODAY from Maryland and District of Columbia Credit Union Association President/CEO Michael Beall says that courtesy pay is a safety net for struggling members. Beall responded to a recent article about courtesy payments, which cover members' checks when they have insufficient funds. The orginal article indicated the service is primarily a profit center "Such courtesy payments are a short-term safety net for members struggling to stay on their feet," Beall wrote. He noted the article underscored important differences between courtesy payment programs of credit unions and those of banks: credit unions charge less than banks and typically use the fee to subsidize favorable interest rates on other services. Credit unions realize their obligation to educate their members about the financial responsibility, he said. Beall's letter was published on the newspaper's editorial/opinion page and online. For the full letter, use the link.

Missouri CUs meet with congressional reps in state

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JEFFERSON CITY, Mo. (8/13/09)--Missouri credit union staff are meeting in person with Missouri congressional members during their August recess.
Click to view larger image Meeting in Kansas City Monday to discuss credit union issues were, from left, Phil Weber, Central Communications CU, Independence; Amy McLard, Missouri Credit Union Association (MCUA); Rob Givens, Mazuma CU, Kansas City; U.S. Rep. Emanuel Cleaver (D-Mo.); Pat Yokley, CommunityAmerica CU, Lenexa; Glenna Osborn, Missouri Central CU, Lees Summit; and Peggy Nalls, MCUA. (Photo provided by the Missouri Credit Union Association)
U.S. Rep. Emanuel Cleaver (D-5) met with a group of credit union representatives Monday in Kansas City. They discussed the impact of the Credit Accountability, Responsibility and Disclosure (CARD) Act of 2009, member business lending, interchange fees and the Community Reinvestment Act on Missouri credit unions (The Missouri difference Aug. 12). “Cleaver indicated his support that credit unions should not be included in the Community Reinvestment Act,” said Phil Weber, president, Central Communications CU, Independence. “The biggest topic discussed was the Credit CARD Act, which we all pointed out has some serious compliance problems and conflicts.” Participants in the meeting included:
* Rob Givens, Mazuma CU, Kansas City; * Glenna Osborn, Missouri Central CU, Lees Summit; * Phil Weber, Central Communications CU, Independence; * Pat Yokley, CommunityAmerica CU, Lenexa; and * Peggy Nalls and Amy McLard, Missouri Credit Union Association.
Also, Poplar Bluff (Mo.) FCU took part in local legislative meetings with U.S. Sen. Claire McCaskill (D) and Missouri Lt. Gov. Peter Kinder Monday. McCaskill hosted a health care forum, and Kinder spoke about state economic issues during a chamber of commerce luncheon. Poplar Bluff President Kirk Mondy and Vice President Diane Powell attended the events. “It is a tremendous privilege and responsibility to be able to meet and address, when possible, our public officials,” Mondy said. “They need to know what their constituents value and believe in order to properly represent us. I also hope that by meeting them personally, we can build a relationship that could help us when credit unions need to be heard.”

PCUA launches ICU NowI online videos

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HARRISBURG, Pa. (8/13/09)--The Pennsylvania Credit Union Association (PCUA) has created a series of online videos to inform members about PCUA initiatives and credit union issues. The first video is now available. The videos, called CU Now, are sponsored through a grant from PCUA’s Service Corp. They profile PCUA’s advocacy, credit union awareness, collaboration and governmental affairs activities. The first segment features PCUA President/CEO Jim McCormack, with other staff scheduled to follow. “In this day of 24-hour news, Twitter and YouTube, we’re launching CU Now as a new information channel to more effectively communicate with our members,” McCormack said. “We know video messaging is gaining in popularity; however, we’re moving forward cautiously, seeking input from our members to ensure quality and relevance.” PCUA will email all Pennsylvania credit unions CEOs as each video becomes available.

Kennebec Valley members petition vs. merger

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AUGUSTA, Maine (8/13/09)--Members of Kennebec Valley FCU (KV FCU) were asked to sign a petition against a proposed merger with a local bank, according to a letter published Tuesday in the Kennebec Journal. KV FCU last year proposed converting to a bank and then merging with Kennebec Savings Bank. The proposal was approved by KV FCU’s board last fall and is awaiting approval from a member vote (News Now Aug. 11). In a letter to the editor, KV FCU member Elaine Carpentier, who worked at the credit union for 15 years, noted some of the concerns that members have about the proposed merger. Some members feel the heritage of KV FCU has been lost, she said. Carpentier also noted in her letter that several mistruths have been circulating about the proposed conversion and merger. KV FCU CEO Beverly Beaucage and the KV FCU board have put members’ interests first, she said. On Tuesday, News Now reported on an earlier letter to the editor in the Journal, by KV FCU member Lucille Cloutier. She questioned the advantage KV FCU would have if it converted to a bank and then merged with Kennebec Savings.

Jittery CUs probing suspicious packages

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MADISON, Wis. (8/12/09)--It's hardly an epidemic, but four separate credit unions across the country this week called authorities in to inspect a variety of "suspicious packages." None of them turned out to be dangerous and apparently none are related. Two of the incidents were Tuesday in Michigan. Peoples Trust CU in Warren and Michigan First CU in Eastpointe both had authorities examine packages left outside their credit unions. Authorities determined they were not explosives. The package at Peoples Trust CU, which forced evacuation of about 50 to 60 people from the credit union area, contained trash-- a travel mug and shirt wrapped in plastic. A note with the items made it clear that the package didn't contain death threats against police officers (Detroit Free Press and The Detroit News Aug. 11). At Michigan First CU, a suspicious briefcase-type bag left outside the credit union is believed to be a service call box left by an electrician or someone working in the area, said the Free Press. The other two incidents, in Connecticut and California involved suspicious-looking powders in envelopes. Mutual Security CU, a $224.2 million asset credit union in Shelton, Conn., called the Federal Bureau of Investigation (FBI) Monday afternoon after a black powder was discovered in a letter. An employee opened the letter and the substance fell out. The employee was evaluated by emergency service personnel and did not have symptoms of illness ( Aug. 10). Police and fire officials also were called to the credit union. The FBI took a sample of the powder and results are expected this afternoon. On Aug. 3, a mysterious white powder found inside a deposit envelope at Schools First CU, Tustin, Calif., turned out to be drywall dust. Two people were checked by paramedics as a precaution. They didn't experience illness symptoms (News Now Aug. 4 and The Orange County Register Aug. 3).

Getaway car injures policeman robbery suspect shot

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SAN ANTONIO (8/12/09)--A San Antonio police office was run over by a getaway car and a robbery suspect was shot Tuesday during a robbery at a branch of San Antonio FCU on Southwest Military Drive. The officer, an eight-year veteran who was not identified, suffered non-life-threatening injuries (Express-News and WOAI Aug. 11). He was dragged by the suspect's small sports utility vehicle after trying to take the keys away. The SUV ran over his chest and arm, and he was taken to a nearby medical center, Police Chief William McManus. An unidentified robbery suspect was hospitalized with a gunshot wound to his arm (Dallas News and Aug. 11). The robbery occurred at 8:15 a.m. when a man driving a dark green Kia Sportage demanded cash from the drive-thru teller, telling her he had a grenade. He drove away with an undisclosed amount of cash. Officers spotted the Kia in a gas station parking lot and approached the car. The officer who was injured tried to grab the key out of the ignition, but the suspect hit the gas while the policeman was still halfway in the car. The officer fired two shots, one of which hit the suspect's arm. Police recovered some money but found no grenade or explosives in the car.

CUs special services to state workers breed goodwill

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HARRISBURG, Pa. (8/12/09)--Pennsylvania's budget impasse is in its sixth week, but thousands of state employees are getting paychecks after working through July and into August with little or no pay. Credit unions have received kudos for special services rendered to help them. Credit unions' special programs generated goodwill from members, said the Pennsylvania Credit Union Association (PCUA) (Life is a Highway Aug. 11). Superior (Pa.) CU saw a steady stream of state employees filing in to repay their PA NonBudget Advance loans. The Collegeville-based credit union, located near the Graterford Correctional Facility, began issuing weekly $500 advances to current and new members. Eleven employees handed out more than 350 advances through the teller line using the Credit Union Better Choice loan format, said PCUA. "The goodwill this service generated has been outstanding," said Superior CU CEO Matt Jones. The $26 million asset credit union signed up 140 new accounts. One member told the credit union that a bank, which visits Graterford, was not willing to help its customers during the budget impasse. Last Friday morning, Superior's staff, expecting a busy day, received NonBudget Advance Survival Kits, which included a stress ball, bottle of pain reliever, a candy bar, a coupon for a 90-minute sleep in late/go home early/long lunch or $25 gift card, and their own box of new paper clips, which had been in short supply because of all the paper work. Employees at another credit union, the $131 million asset Lebanon (Pa.) FCU, processed seven skip-a-payments on existing loans at no extra charge and assisted two state employee members with payday advance lines of credit. CEO Pat Hain said the credit union set up a member assistance program because "it is the right thing to do…We wanted to lessen the burden on families, especially in these economic times." Gov. Ed Rendell signed a partial budget Aug. 5 that allows state employees back pay and current pay. State Treasurer Rob McCord and PCUA President/CEO extended thanks to credit unions that provided assistance in a letter and asked those who amended their Credit Union Better Choice program to revert back to traditional guidelines now that the affected employees are getting paid.

CUNA Technology Council announces new board

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MADISON, Wis. (8/12/09)--The CUNA Technology Council announced its executive committee and officers during its 14th Annual Summit, Aug. 5-8 in San Francisco. Rudy Pereira, senior vice president of operations and technology for Alliant CU, Chicago, will remain the chair. Jackie Buchanan, chief information officer for Genisys CU, Pontiac, Mich., was re-appointed vice-chair. During the recent elections for four seats on the executive committee, incumbent Buchanan was re-elected along with Belinda Caillouet, vice president of information technology for Spokane (Wash.) Teachers CU. Two new members elected to the executive committee were:
* Jennifer Weiss, vice president technology services, Sandia Area Laboratory FCU, Albuquerque, N.M.; and * Jeff Johnson, senior vice president information technology, Baxter CU, Vernon Hills, Ill.
The council’s executive committee also includes:
* John Morawski, chief technology officer, Massachusetts Credit Union League; * Robert Reh, chief information officer, Nassau Financial FCU, Garden City, N.Y.; and * Brian Warfel, executive vice president of sales and service, Power Financial CU, Pembroke Pines, Fla.
The two outgoing committee members are Gordon Gregory, vice president of technology for Mazuma CU, Kansas City, Mo., and Ron Broaddus, chief information officer for Potlatch 1 FCU, Lewiston, Idaho. Both stepped down after fulfilling three- year terms on the committee. In addition to the elections, Heather Moshier, executive vice president of information technology, San Diego County CU, San Diego, Calif., joins the Council's leadership, as an appointment to fill the vacancy created by Juan Luna, chief technology officer, Xceed Financial CU, El Segundo, Calif., who recently stepped down from the executive committee.

Consumers flock to Wisconsin CUs for better rates service

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PEWAUKEE, Wis. (8/12/09)--Consumers are flocking to Wisconsin credit unions for better rates and personal service--many of the same reasons cited in the August issue of Kiplinger’s Personal Finance magazine--said the Wisconsin Credit Union League. “Big banks want your money, too, but they’re turning customers off with higher fees and tighter lending--not to mention stress tests and troubled assets,” Kiplinger’s said. “They continue to raise fees, even as the grab for business intensifies and consumers are more cost-conscious.” In Wisconsin, interest payments on a credit union’s 60-month $25,000 car loan would be $830 less than from a bank, according to CUNA economists. “Consumers are fed up,” says Brett Thompson, league president/CEO. “Even people with good credit feel they’re being punished by banks looking to boost profits, especially prior to new federal credit card rules being implemented. They’re not waiting. They’re seeking refuge now.” Wisconsin credit unions have benefited from the trend, he added. Wisconsin credit unions experienced some of the largest membership growth among member-owned financial institutions nationwide, as of the end of 2008. And as of the first quarter, 250 Wisconsin credit unions saw their assets grow 15.74% and savings grow by 26.11%. Regulators have cited this performance as a good sign in a still-unstable economy, the league said. “Because credit unions are owned by the members who do business with them--not shareholders--consumers are realizing they’re going to get a better deal because of that,” Thompson said. “We think as more consumers discover the financial benefits of this difference in institutions, the trend will only intensify.” The magazine touts credit unions’ lower fees by citing statistics from the Credit Union National Association (CUNA) that reveal the difference between what credit unions and banks charge for services. On average, credit unions charge $25 for overdrafts while banks charge $30. Credit unions charge $20 for a late credit card payment while banks’ fees are $35. The publication also cited credit unions’ typically lower rates for auto loans.

Top 20 best CU brands named by Bancography

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BIRMINGHAM, Ala. (8/12/09)--Bancography has named its top credit union brands for 2009 in its Bancography Brand Value Index. Top-ranking credit unions with assets under $1 billion included White Sands FCU, Las Cruces, N.M.; American Heritage FCU, Philadelphia; and My Community FCU, Midland, Texas. Police and Fire FCU, Philadelphia, earned the top ranking for the $1 billion asset category, followed by Chevron FCU, Oakland, Calif., and Tinker FCU, Oklahoma City.
Click to view larger image Click for larger view
In the large credit union asset category, 14 of the top 25 in 2008 remain in this year’s top 25. In the smaller credit union asset category, eight of the current top 10 ranking institutions appeared in last year’s top 25. In calculating brand value, Bancography quantifies the proportion of each institution’s long-term value based on factors including reputation, service quality, image and market awareness. The brand value index identifies institutions that produce financial results beyond what their capital base, market conditions and competitive environments would predict. Bancography’s Brand Value Index quantitatively ranks the brand strength of all U.S. credit unions, banks and thrifts. The index ranks financial institutions brands by the premium they add to each institution’s underlying tangible value.

IUSA TODAYI cites Student Choice as student loan option

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NEW YORK (8/12/09)--In an article about getting last minute financial aid before school starts, a USA TODAY personal finance columnist cites the Credit Union Student Choice lending program as an option for student loans. The article, "Even as kids pack to go college, it's not too late for aid," by columnist Sandra Block, outlines several options, including private student loans. "Recently, though, some credit unions have started offering private student loans, often at more favorable rates than for-profit lenders," she wrote. More than 80 credit unions are participating in Credit Union Student Choice, a group that helps credit unions offer private student loans, Executive Vice President Scott Patterson told Block. The article said the average interest rate on the loans is 5.8%, with no origination fee, and that the rates are variable. She referred readers to for a list of participating credit unions. "We think it's a terrific acknowledgment of the fair-value private student loans that credit unions affiliated with Student Choice are currently offering," said Michael Weber, vice president of marketing at Credit Union Student Choice. "With nearly 80 credit unions from all across the country offering loans through the Credit Union Student Choice network, we're very pleased that a personal finance expert like Sandra Block is recommending that consumers consider credit unions for private loan funding options," Weber told News Now. He said the network recently revamped its website to make it easier for users.

N.Y. CU association announces awards

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ALBANY, N.Y. (8/12/09)--The Credit Union Association of New York recognized state credit union professionals, volunteers and Hall of
Click to view larger image William Mellin, Credit Union Association of New York president/CEO, presents Linda Garboczi of AmeriCU CU with the 2009 Professional of the Year Award.
Click to view larger image George Bauer, a board member of AmeriCU CU, received a Volunteer of the Year award at the Credit Union Association of New York’s annual convention.
Fame inductees during its annual convention last week. The conference, which was attended by more than 500 individuals, was held in Saratoga Springs, N.Y. The theme was “Credit Unions: The Odds on Favorite.” During the conference, several individuals received awards. Linda Garboczi, vice president of member relations and marketing at AmeriCU CU in Rome, N.Y., received the Outstanding Professional award. Receiving Outstanding Volunteer awards were:
Click to view larger image Yvette Rubio, Alternatives FCU board chair, was presented a Volunteer of the Year award by the Credit Union Association of New York.
Click to view larger image George Wilkinson, Fidelis FCU, received a Volunteer of the Year award. (Photos provided by the Credit Union Association of New York)
* George Bauer, recording officer, board of directors, AmeriCU CU; * Yvette Rubio, board chair, Alternatives FCU, Ithaca, N.Y.; and * George Wilkinson, board president, Fidelis FCU, New York City.
Hall of Fame inductees included:
* Kathleen Frawley, Buffalo (N.Y.) Metropolitan FCU; * Patricia McManus, Buffalo Metropolitan FCU; * Richard Moore, Reliant FCU, Sodus; and * James Thierman, Olean (N.Y.) Area FCU.
Kathy Pelletier, whose grandfather was Roy F. Bergengren, a pioneer of the credit union movement, served as a keynote speaker. Fire Department of New York Battalion Commander Richard “Pitch” Picciotto, the highest ranking firefighter to survive the Sept. 11 collapse of the World Trade Center, also spoke as a keynoter. Pelletier and Picciotto have both spoken at the Credit Union National Association’s America’s Credit Union Conference and Expos in the past. Next year, the New York association’s annual convention will be in June in Cooperstown, N.Y.

CU System briefs (08/11/2009)

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* MUNCIE, Ind. (8/12/09)--Bond has been set at $300,000 for Stanley Dewayne Wills, 30, Muncie, Ind., who pleaded not guilty to robbery charges stemming from a May 27 holdup at Industria Centre FCU, in which more than $250,000 was stolen. Wills and another man, John D. Repass, 29, were formally charged July 23 in a Circuit Court with robbery and conspiracy to commit robbery, but authorities were unable to locate Wills until he showed up at a hearing Thursday. Repass was recently arrested in Utah, where he waived extradiction and is waiting to return to Indiana (The Star Press Aug. 7). He told authorities that he, Wills and Wills' girlfriend, Maranda Conley, 28, committed the robbery. On May 27, two men wearing disguises and armed with a handgun entered the credit union. They took the male employees to a back room and the female employees to the vault. They left in a car allegedly driven by Conley, 28 (The Star Press July 26) … * RALEIGH, N.C. (8/12/09)--State Employees' CU (SECU) members, through the SECU Foundation, approved a 0% , $470,000 construction loan to help build a 3,120 square- foot group home for people with traumatic brain injuries or developmental disabilities. Rowan Way would house six people on a 0.41-acre site in northwest Charlotte, N.C. SECU is partnering with the North Carolina Housing Finance Agency (NCHFA) for the housing project, which is sponsored by Autism Services of Mecklenburg County Inc. (ASMC). At the July 2nd groundbreaking were, from left: Ken Bell, architect; Margaret Stamey, ASMC board member; J. Marc Phillips, ASMC executive director; future resident Owen Gordon; Mary Reca-Todd, NCHFA supportive housing manager; Jerry Harmon, SECU senior vice president; Mark Twisdale, SECU Foundation executive director; and Stephen Kelly, ASMC board president. (Photo provided by SECU Foundation)

Hampel outlines financial strategies for IFox BusinessI

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NEW YORK (8/12/09)--Credit Union National Association (CUNA) Chief Economist Bill Hampel outlined Saturday several financial strategies for consumers on a Fox Business News personal finance show. The show offered consumers the chance to call in and talk with Hampel and several other economists about personal financial
Click for videoWatch Bill Hample on Fox Business News (Photo provided by CUNA)
concerns. During one call, Hampel advised a 54-year-old consumer with $75,000 in credit card debt to pay off the debt since it likely carries a high interest rate, but also encouraged him to continue maxing out his $400,000 retirement fund. “Use your extra income to pay off debt, while putting as much as possible into the 401(k),” Hampel said. The CUNA economist also emphasized the importance of investments--especially for younger consumers under the age of 35 who are discouraged by the recent downturn in the stock market. Investing in retirement “is still the way to go,” he said. Other points Hampel made on the show include:
* One can’t try to time the market when managing an investment portfolio. “That strategy doesn’t work,” he said. “What works is an age-based portfolio.” * Some risk is necessary in any investment portfolio; and * When asked if one should buy gold, he said: “Only buy gold if you believe in hyperinflation. If you don’t believe the world is going to end, don’t buy gold.”

CUs CO-OP raise nearly 1M for hospitals

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RANCHO CUCAMONGA, Calif. (8/11/09)--More than 130 participating credit union organizations raised nearly $1 million during the first six months for Children's Miracle Network. The funds are the result of credit union fundraisers combined with the CO-OP Financial Services' Miracle Match program. Through June 30, credit unions have raised $517,000, and CO-OP Miracle Match donations have added $445,000 for a total of $962,000 for the Children's Miracle Network. CO-OP is committed to donating up to $1 million of matching funds in 2009, and, based on fundraisers planned for the remainder of the year, CO-OP expects this pool to be fully used, "The credit unions, who do all the work in these fundraisers, are the heroes, and we are very proud to help them support children's hospitals in their local areas," said CO-OP President/CEO Stan Hollen. "This effort to improve the level of hospital care for children is an extension of the credit union movement and its tradition of uplifting the lives of individual members and entire communities." The 130 participating credit union organizations are located in 30 states. Leading the states are California (24), Texas (16), Wisconsin (15) and Missouri (13). The donations will go to more than 50 Children's Miracle Network-sponsored children's hospitals located in the fundraisers' local communities. This year, the Miracle Match program inspired credit unions to conduct 10 new fundraisers for the network. Credit unions raised $64,000 through these events, and Miracle Match donations from CO-OP totaled $88,000. Credit unions have sponsored fundraisers in their local communities as part of the Credit Unions for Kids program, which has partnered with Children's Miracle Network since 1996. Credit unions planning a Credit Unions for Kids program can learn more about the CO-OP Miracle Match program at the resource link.

Ruling means Subchapter S banks to pay back taxes

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CHICAGO (8/11/09)--A ruling finalized in July would require nearly 1,500 Subchapter S banks to pay three years of back taxes on municipal bond investments. The privately held banks could end up paying tens of millions of dollars if the ruling, by Judge Maurice B. Foley in favor of the Internal Revenue Service in the U.S. Tax Court, stands (American Banker Aug. 10). The banks are taxed under the Subchapter S rules of the Internal Revenue Code. Usually profits at S Corps are taxed only at the shareholder level and the corporations reimburse their owners for tax mistakes. The cost for the banks could range from $6 to nearly $300,000, said Baker Group LP, an Oklahoma City community banking consulting firm. The firm said that total S Corp banks nationwide would have owed $21.6 million for 2008, if the tax ruling had been in effect then. The statute of limitations for overdue taxes is three years. The ruling was finalized July 13. A lawyer at Godfrey & Kahn SC in Milwaukee, which will represent the owners of First Forest Park Corp., in Illinois in its appeal, noted the case is a test case for all Subchapter S bank. Some said this is the last chance for the banks to appeal the decision.

Vancity CUs bank no longer lending online

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VANCOUVER, B.C. (8/11/09)--Canada's largest credit union has announced that its online banking subsidiary will leave the personal banking marketplace to focus on Visa card services and foreign exchange services for non-retail members. Vancouver City Savings CU's (Vancity) website said its subsidiary, Citizens Bank, is moving to a "more streamlined business model." Vancity also announced it has entered into an agreement to sell most of the bank's retail loans to the Toronto-Dominion Bank (TD Canada Trust). It did not disclose the value of the deal. The move is a good business decision because it returns capital that can be reinvested to enhance member services at the credit union, while focusing on what Citizens Bank does best, said Vancity President/CEO Tamara Vrooman. "We pioneered online banking in Canada, but it's become a crowded marketplace," Vrooman said (Canada Newswire Aug 5). Vrooman added that Vancity's members have repeatedly said they wanted the credit union to focus on its core strengths. "We're local, we're community-focused and our offering is based on building relationships and providing service. In a national online market, we were unable to achieve the scale necessary to succeed. Therefore, the bank's business model wasn't making full use of our strengths." The sale closed Aug. 5. Citizens Bank, which was one of the first online banks in Canada, will become a non-deposit-taking bank and will sell most of its residential mortgages, personal loans and lines of credit secured by real estate to TD Canada Trust.

Letter to editor questions CUbank merger

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AUGUSTA, Maine (8/11/09)--A letter to the editor appearing in the Saturday Kennebec Journal questioned Kennebec Valley FCU’s proposed merger with Kennebec Savings Bank. Kennebec Valley FCU, Augusta, Maine, proposed converting to a bank and then merging with Kennebec Savings in September. The credit union’s board has since voted in favor of it. The conversion and merger is awaiting a vote from Kennebec Valley’s membership. When the merger proposal was announced, the credit union noted that the conversion and merger would significantly expand its capacity to meet the current and future needs of members (News Now Sept. 10). In the letter to the editor, Lucille Cloutier questioned what the advantage would be for members if the credit union converted to a bank. “A huge point has been grossly overlooked: What do the members get in return for turning over all of the credit union’s assets in this merger?” she wrote. “With all of the credit unions in the area who, like Kennebec Valley, manage to survive financially in this economy, why are we being asked to give it all away? Exactly what is the advantage?” she continued. To read the letter, use the link.

Australian CUs seek 1 billion super fund

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AUSTRALIA (8/11/09)--More than 25 Australian credit unions are slated to meet this week with the Australian Prudential Regulation Authority to ask for a $1 billion liquidity fund. The fund, which would be called the Credit Union Mutual Fund, would offer interest-generating coupons to industry super funds. It would give credit unions an alternative source of funding to expand their market share in home lending--currently at 7%, said The Australian (Aug. 10). Credit unions rely on deposits from members as their main source of money. Banks in the country can raise money in the wholesale money market with government-backed guarantees, but credit unions cannot because they aren’t big enough to receive a credit rating, the newspaper said. Mark Genovese, Maritime Mining Power CU CEO, said the money in the fund would earn a return each quarter for the super funds. The money would be added to credit unions’ balance sheets and then lent to their members, he told the newspaper. Australia has 126 credit unions, with more than $70 billion in assets and 4.6 million members.

CU gathers comments about Why I left bank

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SEATTLE (8/11/09)--Seattle (Wash.) Metropolitan CU is gathering comments from its members about why they chose to leave their bank and join a credit union. The comments are a part of Seattle Metropolitan’s “Intentionally Left Bank” campaign, which targets consumers who switched to credit unions from banks. The credit union said it has seen an increase in the number of new members as a result of the campaign (Seattle Business Journal Aug. 7). Members are sending comments to Seattle Metropolitan’s website about why they left banks. Some of the comments include:
* “My bank was inflexible, unapproachable and charged me for everything from my checking account to banking in person.” * “I get higher interest rates on my savings and lower interest on my loans at the credit union. The banks don’t offer anything I need that I can’t get at the credit union so what’s the point? I have not used a bank in almost 40 years.” * “I left my bank because when I went in to get a car loan they said I had to go home and call the 800 number or apply online and they would get back to me. At SMCU I walked in, talked to someone and left with a car loan and a smile on my face.” * “Bank? What’s a bank? I’ve been with SMCU for 20 years.”
Seattle Metropolitan CU’s website indicated that more than 100 members had submitted comments so far.

Oakdale CU damaged by lightning fire

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TOMAH, Wis. (8/11/09)--Oakdale CU’s lobby was damaged after a lightning strike and fire in the early morning hours of Aug. 3. The credit union, located in Tomah, Wis., is still operating. The Oakdale Fire Department responded to a fire at the credit union around 3:18 a.m. on Aug. 3 and saw signs of a lightning strike (The Tomah Journal Aug. 6). The $40-million-asset credit union is functioning through the back portion of its building in its community room. The system and phones are operating, Oakdale Operations Manager Jesse Braman told the newspaper. Estimated fire damage is at 30%. The credit union’s building will be remodeled and the lobby should re-open in one to two months, Braman said. Oakdale’s drive-through was temporarily closed and was expected to be open by now.

Heartland breach price tag 32 million so far

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PRINCETON, N.J. (8/11/09)--The price tag so far for history's largest data breach--the breach announced Jan. 20 by Heartland Payment Systems--is $32 million so far, the company said in its filing Friday with the Securities and Exchange Commission (SEC). According to the filing, the Princeton, N.J.-based payments processor expensed $32 million in the six months ended June 30 for expenses from the breach. Most of the charges--totaling $22.1 million--related to fines imposed by Visa and MasterCard in April against its company and its sponsor banks. Although the company said it believed it had a strong case, it has made a settlement offer to avoid the costs and uncertainty of litigation. In the document, Heartland said it was prepared to defend itself against all claims of liability that may be asserted or assessments that may be imposed by the card brands. The processor has not received a response to its settlement offer. Heartland said the accrual of fines and the settlement offer resulted in its recording a $14.4 million reserve for processing system intrusion as of June 30. That included $19.4 million expensed for the three months ended June 30. The breach compromised roughly 100 million credit and debit cards--the largest breach reported in history. It affected credit unions and their members--as well as other consumers and financial institutions--nationwide. The data breach spawned at least 31 lawsuits on behalf of consumers, investors, banks and credit unions. The class action lawsuits were consolidated by a judicial panel in June and will be heard in the Southern District Court of Texas in Houston. As late as July, credit unions were still reissuing members' cards compromised in the breach.

CU System briefs (08/10/2009)

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* DALLAS (8/11/09)--Texans CU, based in Richardson, Texas, helped raise $135,000 for the Juvenile Diabetes Research Foundation through its Texans CU Swing for a Cure golf tournament in Plano. Former Dallas Cowboy Cliff Harris, right, shown with Texans CU Chief Operating Officer Greg Gallant, hosted the tournament. Harris was joined by local celebrities Mike Modano, Rudy Gatlin, Pat Green, Rocket Ismail, Toby Peterson and Everson Walls. Texans was the title sponsor, supported by Dr Pepper, Snapple Group, Texas Western Hospitality, Andrews Distributing, Brazos Gas Co. and Lockheed Martin. (Photo provided by Texans CU) … * LAWRENCEVILLE, Ga. (8/11/09)--Gwinnett FCU and Aurora Theatre have
Click to view larger image Click for larger view
expanded their partnership with a five-year $125,000 pledge and season sponsorship from the credit union. The theatre will name its studio theatre the Gwinnett FCU Studio in honor of the $119 million asset, Lawrenceville-based credit union. Their partnership began a year ago when the credit union sponsored the drama, "Dracula." At the check presentation are, from left: Anthony Rodriguez, Aurora Theatre producing artistic director; Marshall Boutwell, president/CEO of Gwinnett Federal; Ann-Carol Pence, Aurora Theatre associate producer; and Katie Sweeney, Gwinnett Federal assistant vice president of business development. (Photo provided by Gwinnett FCU) … * ALBANY, N.Y. (8/11/09)--Miles Kucera, former founder and board director of Suffolk FCU in Medford, N.Y., and who was killed last week in a car crash, was also former chair of the Credit Union Association of New York, said the association Monday. Kucera began the credit union from the trunk of his car more than 40 years ago. He served on the association's board from 1986 to 2000 and as its chair from 1995 to 1997. He was inducted into the association's Hall of Fame in 2004. In 2007, the credit union's new headquarters was dedicated in Kucera's name. His death was reported in Monday's News Now

CU System briefs (08/07/2009)

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* MERIDEN, Conn. (8/10/09)--Connecticut Credit Union League President/CEO Tony Emerson was scheduled to appear on WVIT TV’s “Connecticut Newsmakers” program Sunday alongside of State Rep. Ryan Barry (D-Manchester) to talk about a student loan program that state credit unions are participating in with the governor’s office. He was slated to discuss the benefits of credit union members and the impact credit unions have had on the state’s economy ... * MEDFORD, N.Y. (8/10/09)--A former founder and board director of Suffolk FCU in Medford, N.Y., died in a car crash Thursday. Miles Kucera was one of several county employees who founded the credit union in 1967 and served on its board until his death. He also worked full-time at Suffolk after he retired from public works. In 2007, the credit union’s Medford headquarters was dedicated in his name ... * ROCK HILL, S.C. (8/10/09)--A 70-year-old man lost $2,300 in cash after three men got into the car he was driving and took the money. He had just cashed two checks at Family Trust FCU, Rock Hill, S.C. The robbers unlocked the passenger side door of the man’s car and took the envelopes, which were sitting on the seat (The Herald Aug. 7). The robbers are still at large ... * PHOENIX (8/10/09)--Todd A. Pearson has been selected president/CEO of Arizona Central CU. He replaces Roland Livermon Jr., who retired in January. Pearson had been serving as interim CEO when Livermon retired. Prior to that, Pearson was senior vice president and chief operations officer. He also has worked for the Arizona Credit Union League. Arizona Central has $420 million in assets ...

Corporate Centrals PIC offering nets 47 million

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MUSKEGO, Wis. (8/10/09)--Corporate Central CU members have contributed more than $47 million to Paid in Capital (PIC), indicating a strong commitment of ownership, announced Corporate Central. As of July 31, the closing date, 155 members of the corporate participated in the offering, with an ending total of $47,363,996. "Corporate Central CU's members have spoken; they have determined the value of Corporate Central, and they have expressed their desire to set the course and direction for their corporate credit union," said Corporate Central's press release. The corporate had hoped to raise $60 million but still termed the PIC contributions a success. "While the goal of $60 million was not achieved during this initial PIC offering, that amount was only what we were targeting to get back to the 4.35% core capital level prior to the impairments at U.S. Central," said President/CEO Robert W. Fouch. He said the contributions put the corporate "well above the regulatory minimum of 2% core capital. Our members have demonstrated the commitment and responsibility of ownership by ensuring that Corporate Central CU stands strong." In April, the corporate sent a PIC offering with a closing date of July 31 to its Membership Capital Share Deposit members. A letter from Fouch noted they had been informed earlier that the corporate's balance sheet would reflect impairment charges as a result of U.S. Central's conservatorship. "The math is such that Corporate Central still has retained earnings and none of your Membership Capital that you have with us is impaired," Fouch's letter said. "Due to regulatory restrictions, we are now forced to get our core capital levels back above the minimums." After the offering, the corporate held discussion and question-and-answer sessions. "The response was overwhelming," said the corporate. "The overall tone was one of commitment and support as members vowed to stand behind their credit union." All of Corporate Central's board members participated in the PIC offering, said Daniel Ige, board chairman, in a letter in early July. The corporate also added a website for members with an animated wall of building blocks to show where the corporate stood in its PIC goal. As the wall got higher, momentum picked up and commitment forms starting pouring into the corporate. Members' testimonials can be found on the corporate's "Building Our Future Together" website by using the resource link.

CUs address pulling back vs. outreach to new markets

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WASHINGTON (8/10/09)--The National Credit Union Foundation (NCUF) and all six CUNA Councils are inviting credit union leaders to participate in a multi-media conversation on a strategic question during this volatile economy: “Is now the time to hunker down, or is now the time to aggressively pursue market share?” Answers can be shared in writing, on video, or via audio podcast. Where credit union leaders see an online icon for “REAL Credit Union Voices,” they can prepare an “Executive Monograph” to be posted on NCUF’s REAL Solutions Impact Center and six CUNA Councils’ websites. (Use the links.) “The REAL Credit Union Voices series will feature diverse opinions about business strategies during these interesting economic times,” said NCUF Executive Director Steve Delfin. “Every week, in collaboration with the CUNA Councils, we hope to receive new Executive Monographs to present the latest perspectives on this timely and relevant topic. The initial comments we’ve received are very revealing. We look forward to seeing more credit union leaders’ insights as we open these conversations on impact.” Of the 58 credit unions who have responded in writing, 59% say now is an opportunity to capitalize on increasing awareness and trust that consumers are placing in credit unions. “The majority of credit unions are aggressively targeting emerging markets and increasing product offerings to grow membership and assets,” said REAL Solutions National Program Director Lois Kitsch. The fastest-growing emerging markets for credit unions include youth (ages 11-18), young adults (19-30), and recent immigrants. Credit unions providing REAL Solutions offer up to 26 innovative products to serve those consumers who are working to save and build assets (News Now, July 13). The other 41% of early respondents believe now is a prudent time to focus inwardly and reduce expenses. Many of these credit unions serve regions that have been hit hard by the recession. As their communities face severe unemployment, rising consumer loan delinquencies and unprecedented foreclosures, their credit unions are working to control asset growth. Credit unions can share their strategy and vote in the REAL Credit Union Voices survey.

N.C. regulator still independent takes budget hit

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GREENSBORO, N.C. (8/10/09)--The North Carolina state budget has been announced and indicates that the state Credit Union Division will remain independent, according to the North Carolina Credit Union League. The Credit Union Division was removed from the state’s general fund. However, the division’s reserves of $760,411 will be transferred to the General Fund. “We consider the removal of the Credit Union Division’s budget from the General Fund a win for state-chartered credit unions,” said Lauren Whaley, league director of state legislative affairs. “The division has escaped the budget cuts and political influence it would have been subjected to under control of the legislature. Allowing the division to maintain its autonomy is vitally important with the current conditions of the financial industry and economy.” Whaley also noted that no furloughs or layoffs of examiners in the division are planned.

BECU consolidates branches in Seattle

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SEATTLE (8/10/09)--Boeing Employees CU (BECU) in Seattle is no longer operating branches in Safeway stores in Thurston County. Instead, the credit union has consolidated those operations into a new stand-alone branch that opened Aug. 1. The Safeway branches were closed in west Olympia and in Lacey at the end of July. The stores still have BECU ATMs, BECU spokesman Todd Pietzsch told the newspaper (The Olympian Aug. 7). He said that credit union members can access their accounts through a shared branching network. Closing the former Safeway branches that were small made sense because the new branch is larger and is in a high-growth area, Pietzsch said. Some BECU members told the newspaper that they were happy about the new branch because it was nicer than previous locations. One member also said he didn’t mind driving the extra distance to get to the new branch. BECU is still operating some locations in Safeway stores in other parts of the state, including Tacoma, Puyallup and Bonney Lake.

Texas teller saves member held hostage

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SAN ANTONIO, Texas (8/10/09)--A teller with Security Service FCU in San Antonio helped a member avoid a potentially dangerous situation after receiving a withdrawal slip from the member asking for help because she was being held against her will. The teller was working at the credit union’s drive-through window July 29 when a female member drove up to conduct a transaction (San Antonio News-Express July 29). She gave the teller a withdrawal slip that said, “Don’t give me any money. Help.” The teller alerted her supervisors, who called the police. She also stalled the member until police arrived 10 minutes later. Police surrounded the vehicle. Hiding in the backseat of the woman’s car was a man who had approached her earlier. The man had taken the woman’s car keys and forced her to drive to the credit union.

Oregon CUs testify on MBL

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BEAVERTON, Ore. (8/10/09)--Rick Hein, president/CEO of OSU FCU in Corvallis, Ore., testified Aug. 4 on member business loans (MBLs) before a congressional subcommittee at the invitation of U.S. Rep. Kurt Schrader (D-Ore.). Hein testified at a field hearing in Salem of the U.S. House Subcommittee on Finance and Tax about how credit unions can help small businesses access capital. Hein said the 12.25% cap on MBLs needs to be removed because it has no economic, safety and soundness, or historical rationale. Credit unions could make up to an additional $10 billion in business loans in the first year if there were no lending cap, Hein said, citing Credit Union National Association statistics. “Removal of the cap on member business lending could be a significant step toward getting capital flowing again in our region,” Hein said. H.R. 3380, the Promoting Lending to America’s Small Businesses Act, was recently introduced in Congress. The bill would raise the MBL cap to 25%. The bill also would raise the “de minimus” threshold for a loan to be considered an MBL and exempt loans made to non profit religious organizations and in qualified underserved areas.

Rev up thumbs for fastest texting contest

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HONOLULU (8/10/09)--Tech-savvy consumers in Hawaii are revving up those thumbs. To highlight the launch of its new brand, Honolulu-based Hawaii Central CU is conducting Hawaii's first Fastest Texting Contest with two events. On Aug. 29, about 200 people will compete in the preliminary texting rounds at HCCU's South King Street branch. Texting finals will be held Sept. 12 at 1 p.m. at Kahala Mall. The winner receives $1,000 plus other prizes. The new branding campaign centers around a new tagline: "Connect. Inform. Belong." "Connect" refers to how the credit union links business partners to others looking for services or assistance. "Inform" refers to a series of forthcoming seminars by local community experts and management staff on topics such as building credit, ID theft, basic budgeting and financial literacy. "Belong" points to the array of benefits the credit union's members can enjoy. Applications are due Aug. 21. Participants are asked to donate non-perishable items to benefit Catholic Charities Hawaii.

CUNA celebrates 75th anniversary today

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WASHINGTON and MADISON, Wis. (8/10/09)--Today the Credit Union National Association (CUNA) is blowing out 75 birthday candles. It was Aug. 10, 1934, when CUNA's Constitution and Bylaws were signed in Estes Park, Colo., less than two months after the Federal Credit Union Act was signed and 25 years after the nation's first credit union was established.
Click for slide show These pioneers of the U.S. credit union movement met at Estes Park, Colo., Aug. 8 -10, 1934 to form a national association--today's Credit Union National Association. Its constitution and bylaws were signed on Aug. 10. (Photos provided by CUNA)
"Seventy-five years ago, an extraordinary group of credit union pioneers held a 'meeting of the minds' in Estes Park, Colo., about a national association that would enhance the movement throughout the land and help it become self-reliant," said CUNA President/CEO Dan Mica. "Ultimately, 52 delegates from 21 states and the District of Columbia exchanged views in a 'constitutional convention' of sorts. Over four full days, the delegates debated (sometimes in heated terms), cooled off in the mountain air, and debated again," Mica said. Mica noted that historians wrote years later: "Most of those present felt a deep sense of satisfaction at having at last developed the organizational framework for an association which hopefully would advance the credit union movement to new heights of usefulness and service. "Today, it is an honor for all of us at CUNA to continue the work set out by those leaders three-quarters of a century ago. Our focus is completely on advancing this great movement to new heights--through leadership, advocacy and services," Mica said. "Next month, when the CUNA Board meets in Estes Park as a tribute to our organization's founders, all will have 75 years of credit union progress on our minds--and a determination to ensure the next 75 years of progress and prosperity for credit unions," Mica concluded. For a highlighted history of the movement's progress, use the link.

CUs student loan efforts recognized in IWall St. JournalI

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NEW YORK (8/7/09)--A Dow Jones Newswires personal finance column carried in Thursday's Wall Street Journal discusses the increase in credit unions offering student loans as a response to consumer demand in a tight-credit market. Jilian Mincer's "Getting Personal" column notes that many private lenders are abandoning the business as access to credit tightens. However, credit unions are in a better position to make loans because they did not engage in speculative financial practices. The column cites several credit union programs, including the Credit Union Student Choice program, which has more than 80 credit unions participating; New Jersey credit unions' new network for student loans; and Connecticut credit unions' new program in which the state partially guarantees loans made by 25 credit unions. Paul Gentile, president/CEO of the New Jersey Credit Union League, told Mincer that banks have exited the student loan market in a big way and that the league's new network of credit unions making student loans is getting an "overwhelming" number of applications. Tony Emerson, president/CEO of the Credit Union League of Connecticut, says the response to credit unions' program in that state has been "outstanding." He noted some credit unions are maintaining rates of 5.75% or 6% for 10 years or more. Those in the program commit to the rates for the first five years. In the article, Mark Kantrowitz, publisher of FinAid, a website tracking the college financial aid industry, says credit unions loans are "worth considering once government loan options have been exhausted."

First Iowa CU IDA saver buys first home

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ESTHERVILLE, Iowa (8/7/09)--Christy Mart's dream of owning a home is now reality. She closed on her first home in Wallingford, Iowa, on July 21, becoming the first Iowa credit union Individual Development Account (IDA) saver to buy a home.
Click to view larger image Posing in front of the new home purchased by the first Individual Development Account (IDA) saver in Iowa credit unions' IDA program are, from left: Marybeth Foster, executive director, Iowa Credit Union Foundation (ICUF); Christy Mart, the IDA saver and new homeowner; and Lana Ross, executive director of Community Action Agencies and board member of ICUF. (Photo provided by the Iowa Credit Union Foundation)
Mart's savings was matched by $4,000 through the Iowa Credit Union Foundation's Credit Union Family Partnership IDA program. She used the amount for the down payment on the home. As part of the program, Mart receives financial education through Employees CU, based in Estherville. An IDA participant's savings is matched by a grant from another organization. The individual can use the savings and matching funds to purchase a specific asset such as a home, start or expand a small business, pay for education or job training, or purchase a vehicle to get to work. "The goal of the program is to help demonstrate to low-income Iowans the importance of savings in an effort to end poverty and to help working Iowans become financially independent," said Employees CU CEO Mark Peters. Peters noted that Mart has "learned more about money management that will guide her in the future." The credit union is one of nine Iowa credit unions in the Credit Union Family Partnership IDA program. "The whole experience has just been amazing and continues to get better and better," Mart said. "Everything worked out perfectly to help me purchase this home, and I am so lucky to have been given this opportunity and for the generous financial support provided through the credit union IDA program and Employees CU." "Christy is our first Iowa credit union IDA saver to purchase an asset, and we couldn't be happier," said Marybeth Foster, ICUF executive director. "She is such a hard worker, and we're thrilled to have helped her become more financially secure."

Article CUs an alternative to Wis.s payday loans

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MADISON, Wis. (8/7/09)--Wisconsin credit unions are striving to be an alternative to costly payday loans for state residents in need of cash, said an article about the state’s lack of a ceiling on payday lending rates. Credit unions are attempting to meet the need for small, short-term loans, said Christine Henzig, director of communications for the Wisconsin Credit Union League (The Capital Times Aug. 5). A 2008 survey indicated that 60 Wisconsin credit unions offer loans that in essence are alternatives to payday loans, even though they are not uniformly marketed that way, Henzig told the newspaper. The article also mentioned the national initiative to help credit unions develop products to improve their members’ creditworthiness and build wealth---REAL Solutions. The program is offered by the National Credit Union Foundation. University of Wisconsin CU, Madison, Wis., told the newspaper it is encouraged by members’ responses to its Paycheck Advance program, which lent more than $21,000 in 51 loans to members since its inception in June. Through the program, members can borrow up to $500 at a 21.75% interest rate. They must pay back a $50 minimum each month. Borrowers must be members of the credit union, maintain a positive balance in their accounts for six months, and have their paychecks directly deposited into their accounts, the paper said. “Compared to payday loan interest, [the program] offers significant savings to members who have trouble qualifying for a traditional loan,” Mike Long, the credit union’s executive vice president and chief credit officer, told the paper.

New Ohio Latino CU awarded 50000 from Toledo foundation

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DUBLIN, Ohio (8/7/09)--A Toledo, Ohio, foundation has awarded a grant to an Ohio-based credit union that is being established to help Latinos in the Northwestern part of the state. The credit union, Nueva Esperanza (New Hope) Community CU, would be the first new state-chartered credit union in Ohio in more than 20 years that serves an area in which more than half of area households are low-income. Toledo Community Foundation provided $50,000 to Nueva Esperanza on the condition that the credit union raises an additional $100,000, receives its charter, and obtains federal deposit insurance, said the Ohio Credit Union League (eLumination Aug. 5). The application was written by a grantwriter funded by the Ohio Credit Union Foundation, which obtained a $69,500 Innovation Grant from the National Credit Union Foundation (NCUF) for the credit union earlier this year. "Nueva Esperanza Community Credit Union will be a real asset to South Toledo," said Steve Bosack, NCUF deputy dirctor. "The credit union's presence will help residents achieve financial literacy, establish credit, and build savings. With so much support coming from within the community, the credit union will also serve as a source of community pride."

Fraudster targets shared branches

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BEAVER, Pa. (8/7/09)--WESTAIRCOMM FCU, Beaver, Pa., is alerting credit unions on its shared-branching network about a fraudster who has hit several western Pennsylvania credit unions. The individual opened an account with WEST-AIRCOMM in early June. Over the next few weeks, he deposited checks at two other credit unions on the shared branching network. The checks looked like payroll checks, but were from closed accounts (Life is Highway Aug.5). The fraudster knows the workings of shared branching, said Bill Gandjos, director of collections and security for WEST-AIRCOMM. “He’s definitely a pro. He went to two different shared service centers--one in West Mifflin, Pa., and one in McKeesport, Pa.--and deposited checks on the same closed accounts,” Gandjos told News Now. “My gut feeling is that he thought we wouldn’t do anything about it. I talked to him Monday.” The credit union sent the man a letter, required by Pennsylvania law, informing him that he had 10 days to make good on the checks or be subject to prosecution. That 10 days passed July 31, Gandjos said. “I gave his name to the Beaver (Pa.) police to prosecute him,” Gandjos added. Sandy Shenk, Pennsylvania Credit Union Service Centers Inc. state coordinator, suggested to the Pennsylvania Credit Union Association that credit unions delay access to shared branching for new members until the members have established a relationship with the credit union.

Alabama-based CU placed in conservatorship

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BIRMINGHAM, Ala. (8/7/09)--The senior staff of Mutual Savings CU, Birmingham, Ala., is working with the Alabama Credit Union Administration(ACUA) to get the credit union out of conservatorship, Sonja Purvis, senior vice president of marketing and development, told News Now. The state-chartered credit union was placed into conservatorship by ACUA July 31. Its board, supervisory committee, and CEO have been relieved of their duties at the credit union. Members of the senior staff remain, Purvis said. Tom Tatum has been named acting CEO of the $191 million asset credit union. Tatum has more than 40 years of experience in the credit union industry and is the former CEO of Jefferson County Teachers FCU.

CU System briefs (08/06/2009)

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* JACKSONVILLE, Fla. (8/7/09)--Thieves tried to steal a credit union's ATM with a stolen backhoe early Wednesday morning, according to the Jacksonville Sheriff's Office ( Aug. 5). The incident, which occurred at a VyStar CU stand-alone ATM in Mandarin, was discovered by a passerby who called police at 4:30 a.m. A tractor with a backhoe pulled the ATM out of the ground and damaged the machine. For a video report of the damage use the link … * SEATTLE (8/7/09)--A substitute postman was charged last week with mail theft and bank fraud after alleged swiping business checks totaling $220,000 from his delivery route and depositing them into his wife's account at BECU (formerly Boeing Employees CU). After allegedly depositing a check for more than $208,000, Trevor L. McBee told his wife they'd won the lottery, according to court documents. The documents allege he forged the payee's name on the back of the check as endorsement or altered the payee to include his wife's name, then forged her name to endorse the check. All checks were deposited via ATMs. (The Seattle Times Aug. 5) … * MONTGOMERY, Ala. (8/7/09)--A former accountant and chief financial officer at Wiregrass FCU, a $37 million asset credit union in Dothan, Ala., was sentenced to 15 months in federal prison for embezzlement. Becky J. Hughes, 49, of Midland City, Ala., pleaded guilty March 25. She also was ordered to serve five years of supervised release. Beginning in 2000, court documents said, Hughes opened several Visa credit card accounts in her and relatives' names, and increased the credit limit of one account in her name from $5,000 to $50,000. Hughes owed $137,000 on the cards when Wiregrass discovered the problem in 2008 (US Fed News_Aug. 6) … * LANSING, Mich. (8/7/09)--The Michigan Credit Union League has promoted Marcia Hune to vice president of governmental and public affairs, and Michael DeFors as vice president of information
services, effective immediately. Hune will oversee all legislative advocacy and external communications, while DeFors will oversee regulatory affairs, education and member communication. They will split the duties of former Executive Vice President Patrick La Pine, who became president/CEO of the League of Southeastern Credit Unions Monday. Hune has more than nine years' experience in state legislature as staff for two speakers of the house, two majority floor leaders and the House Republican Policy Office. DeFors, an attorney, was the league's director of regulatory affairs for five years. He has 16 years' experience as senior vice president of governmental and public affairs with the Michigan Bankers Association … * BATON ROUGE, La. (8/7/09)--Kids under 12 enjoyed the Sixth Annual Free Kids Bike Race sponsored Saturday in Denham Springs by Pelican State CU, with help from North Oaks Health Systems and Anytime Fitness (eWeekly Aug. 5). According to the Louisiana Credit Union League, more than 100 children and their families attended the event, which was created to give the community a completely free day of fun. Each bike racer received a medal of completion and a bag of goodies. Free bicycles were raffled off in three age groups: Winners were Juliana Girona, 4; Nicolas Girona, 6; and Blayne Chapman, 10. (Photo provided by the Louisiana Credit Union League) …

CUNA Management School graduates 55

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MADISON, Wis. (8/7/09)--CUNA Management School graduated 55 students with 27 designated as honors students. The school took place on the University of Wisconsin-Madison campus.
Click to view larger image Mark Bohdaynk (left), president of the CUNA Management School Madison Class of 2009, receives the Al Jordan Award from Eddie Hamp, director of campus activities at the school’s graduation in Madison, Wis. (Photo provided by CUNA)
Of the 155 students attending the three-year program, 41 were first-year students, 59 were second-year students, and 55 were third-year students. Sixteen graduated with honors, nine with high honors, and two with highest honors. Kristina Grebener, director of editorial staff and strategic development at the Credit Union National Association and Kathleen O’Brien, Casco FCU in Gorham, Maine, received highest honors. High honors graduates were:
* Marlene Curtis, Munising (Mich.) Community CU; * Laura Eblen, Central Missouri Community CU, Warrensburg, Mo.; * Jay Gostonczik, General Mills FCU, Minnetonka, Minn.; * Chris Kleckner, Cornerstone CU, Freeport, Ill.; * Michelle Merkley, Keystone FCU, West Chester, Pa.; * Tracy Molander, Linn Area CU, Cedar Rapids, Iowa; * Daniel Rajsic, First Trust FCU, Michigan City, Ind.; * Brett Rinker, Industrial Centre FCU, Muncie, Ind.; and * Craig Sanders, America First FCU, Ogden, Utah.
Honors graduates were:
* Matthew Beaulieu, Holy Rosary Regional CU, Rochester, N.H.; * Scott Byron, Dow Chemical CU, Midland, Mich.; * Julie Cash, Associated Healthcare CU, St. Paul, Minn.; * Suanne Debski, UP Catholic CU, Marquette, Mich.; * Dawn Dunkelberger, North Memorial FCU, Robbinsdale, Minn.; * Michele Goebel, Dale ECU, Columbus, Neb.; * Willian Jarvis, Valley Communities CU, Mosinee, Wis.; * Carol Judd, Tinker FCU, Midwest City, Okla.; * Jewell Konieczny, Bangor (Maine) FCU; * Adam McGowan, Jax FCU, Jacksonville, Fla.; * Angela Muxworthy, New Mexico Educators FCU, Albuquerque, N.M.; * Patricia Puckett, Rapid City (S.D.) Telco FCU; * Beth Putnam, CFCU Community CU, Ithaca, N.Y.; * James Sole, Jax FCU, Jacksonville, Fla.; * David Thone, Fox Communities CU, Appleton, Wis.; and * April Lynn Watts, Market USA FCU, Laurel, Md.
Mark Bohdaynk of Table Rock FCU, Shell Knob, Mo., received the Al Jordan Leadership Award. Phil Hellmuth, associate dean emeritus, Colleges of Letters and Sciences at the University of Wisconsin, received the Achievement of Excellence Award for his service and leadership to CUNA Management School. The third-year graduating class also presented $21,246 to the CUNA Management School Scholarship Fund. The money will help smaller credit unions and individuals without financial resources attend the management school. CUNA Management School in Madison offers students a three-year course of study involving academic training and practical applications for credit union management personnel who wish to achieve senior management and leadership positions.

Financial Trends in CDCUs reports economys impact

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NEW YORK (8/6/09)--The economy's impact throughout 2008 on community development credit unions (CDCUs) was mixed, according to a new report released by the National Federation of Community Development Credit Unions. CDCUs experienced overall increases in total assets and membership served, and modest growth in real estate, commercial and industrial, and member business lending. But the economy resulted in the loss of 18 CDCUs due to mergers and liquidations last year, said the federation's "Financial Trends in Community Development Credit Unions: 2008." Assets of the CDCUs grew 5.2% or $224 million on a base of $4.3 billion. This figure outpaced the 2.13% growth in their net worth, causing their aggregate net worth-to-asset ratio to decrease to 9.99% from 10.29%. Managing operating expenses continues to be an area of difficulty for many CDCUs. "It is the nature of the CDCU business that expenses exceed those of credit unions that do not primarily serve low-income populations," said federation President/CEO Cliff Rosenthal. "The driving factors include small average share and loan balances, limited payroll deductions, the typically small size of the institutions themselves, and the high level of personal service required in low-income communities," Rosenthal added. The 18 credit unions liquidated or merged represents a loss of 9% of the federation's membership--on par with the highest losses of the past 10 years. Even though they did not engage in the toxic lending that caused the economic turmoil, the impact on CDCUs with their mission of serving low-income communities has been disproportionately high, said the report. "The loss of so many CDCUs…represents a terrible blow for the underserved communities these institutions serve," said Pablo DeFilippi, federation director of membership services. "Without them, many communities will be left without access to affordable financial services, not to mention vital developmental services such as financial education and asset-building programs that these institutions have historically provided." When CDCUs merge with other CDCUs, "we have invariably witnessed the closing of branches in the lowest-income neighborhoods, further disfranchising those communities," DeFilippi said. Sustaining growth while controlling delinquencies and operating costs will continue to be a major challenge for CDCUs. Alice Greenwald, federation community development investments director, explained that the low interest-rate environment means many CDCUs are having trouble generating sufficient income from their loans and investments to offset their expenses. "We're doing all we can to help CDCUs weather the financial crisis, such as providing our members with secondary capital, which is deeply subordinated debt that can be counted as institutional net worth, but the demand from our members far exceeds our resources," Greenwald said. The federation said that $17 million in grants recently awarded to nine CDCUs by the Treasury Department's Community Development Financial Institutions Fund will help. The federation also is pressing the National Credit Union Administration to convert low-interest loans from its Community Development Revolving Loan Fund into secondary capital to help boost the CDCUs' net-worth ratios. Other key findings for 2008:
* CDCUs' membership grew 2% to 1,036,779; * Their profitability (return on average assets) decreased to 0.06% from 1.01%; * Net worth rose $9 million or 2.13% but net worth-to-assets ratios declined; * Loans rose by $208 million or 6.27% with loans to assets rising to 77.75% from 76.98% the year before; * Delinquent loans as a percentage of total loans rose to 2.88% from 2.25%, with the net charge-off rate increasing to 1.20% from 0.76%. The media ratio in 2008 was 3.79%, up from 3.43% in 2007; * Operating expenses were 5.16% of average assets, an eight basis point increase from year-end 2007; and * Shares/deposits increased by $250 million or 6.58%.

Mortgage-loan docs fraud insurance launched

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MADISON, Wis. (8/6/09)--CUNA Mutual Group is introducing the credit union industry’s first fraudulent mortgage loan documentation coverage as part of a new release of its Bond policy. This new coverage will help credit unions manage losses from increasing fraudulent acts committed by residential mortgage borrowers, CUNA Mutual said. Fraudulent Mortgage Loan Documentation (FMLD) coverage applies to material misrepresentations, through alterations by the borrowers, on certain residential mortgage lending documents used by credit unions to make lending decisions. These include verifications of income and employment, offers to purchase and/or appraisal reports. U.S. mortgage fraud is escalating, according to the Federal Bureau of Investigation (FBI). Mortgage fraud reached an all-time high in 2008, with more than 64,000 reported incidents, said a recent report by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN). “When it comes to mortgage lending, even the most vigilant credit unions can be duped by their members,” said John Wallace, product executive for CUNA Mutual’s Credit Union Protection division. “Whether the loan is a first or second mortgage or a home equity line of credit, today’s technologies make it easier than ever for members to create or alter documents that credit unions rely on for their lending decisions.” Here is a typical loss scenario: A member seeking to purchase a home alters documents to represent her employment status to secure a mortgage loan beyond her means. Eight months later, after the member defaults on the payments, the credit union discovers the documents were altered fraudulently. The credit union is forced to foreclose on the property and incurs a loss. The analysis of FinCEN’s suspicious activity reports filed between 2007 and 2008 indicates a 23% increase in the number of mortgage fraud reports filed. Two categories contributed primarily to the increase:
* Misrepresentation of income, assets and/or debt; and * Forged or fraudulent documents.
Amid the current mortgage crisis, fraudulent activity that goes undetected can cause devastating losses for credit unions, said CUNA Mutual. “Even if credit unions sell their mortgages into secondary markets, they’re still at risk,” Wallace said. “When fraudulent documentation is used as the basis for the original lending decision, buyers such as Fannie Mae or Freddie Mac can require the credit union to repurchase the loan and absorb the loss.” A robust mortgage loan underwriting process is the most effective way to avoid fraudulent loans altogether, Wallace said. CUNA Mutual’s risk management group recommends taking several steps to help avoid such losses:
* Request verification of employment directly from the borrower’s reported employer(s); * Request verification of deposit directly from the borrower’s reported financial institution(s); * Request tax history directly from the Internal Revenue Service using Form 4506 or 4506-T (two-year history for self-employed borrowers); and * Secure current credit scores from a third-party credit reporting agency.
FMLD is part of CUNA Mutual’s Bond program, a key component of the Credit Union Protection insurance and risk management portfolio designed exclusively for credit unions to manage their financial, operational and personal risk exposures. In addition to the Bond, other Credit Union Protection policies include:
* Plastic Card; * Management & Professional Liability; * Property & Business Liability; * Business Auto; and * Plus, additional policies.
The Bond program is underwritten by CUMIS Insurance Society, Inc., a company of CUNA Mutual Group. More information is available at the link.

CEOs letter to editor discusses interchange issue

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CARTERET, N.J. (8/6/09)--A credit union CEO's letter to the editor of a New Jersey newspaper outlines why credit unions oppose changes that would allow merchants to renegotiate changes in interchange fees with financial institutions. In the letter, published Wednesday in, MidState FCU President/CEO Tracy Sussman responded to an earlier letter on the fees. MidState FCU is a $16 million asset credit union based in Carteret, N.J. "If merchants have their way and succeed in changing the current terms of interchange fees, we may no longer be able to provide this convenience (credit and debit cards) for our members. Interchange fees cover the costs associated with credit and debit cards--things like delinquent payments, fraud, and those who just plain default on their credit cards," Sussman wrote. She noted that the credit union assumes the risk so merchants can accept credit cards. Merchants get paid quickly--often the same day--while the credit union must wait up to 30 days to be paid for the same transaction. "Interchange fees are just part of the cost of doing business, much like postage and advertising, and they are certainly less costly than returned check charges. What the merchants aren't saying is that the change in the current structure will not benefit the consumer, but will benefit merchants." She noted the driving force behind the merchants are big box stores, not local "mom and pop" shops. "While it is true the merchants are paying more in interchange, it is not due to raised fees, but simply volume," said Sussman. Two bills in Congress on the issue have not seen action. H.R. 2695, the "Credit Card Fair Fee Act of 2009" offered by Reps. John Conyers Jr. (D-Mich.) and Bill Shuster (R-Pa.), would permit merchants to negotiate fees with financial institutions via an antitrust exemption. Another bill, S. 1212, The Credit Card Fair Fee Act introduced in June by Sen. Richard Durbin (D-Ill.), would establish a panel of three Electronic Payment System judges to intervene in fee disputes between card service providers and merchants using the system. The Credit Union National Association (CUNA) is monitoring progress of the bills. CUNA opposes legislation that would affect interchange fees because it believes such action would adversely limit consumer options, competition and technological innovation. CUNA says that interchange fees allow business costs, including the risk of consumer nonpayment, to be shared by the payments participants. Discussions regarding what value should be placed on the use of electronic payments should be within the purview of the industry participants. CUNA has also recommended that legislators wait for the results of a Government Accountability Office review of interchange fees before acting on any interchange legislation. To review the letter to the editor, use the link.

CU System briefs (08/05/2009)

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* DALLAS (8/6/09)--Southwest Corporate FCU is lowering the registration costs for credit unions attending this year's 32nd annual Economic Forum Oct. 27-28 in Dallas. "We understand this is a challenging year for many credit unions, so Southwest Corporate is reducing the Economic Forum registration fee to make it easier for credit unions to attend," said Kathy Garner, the corporate's executive vice president of member services and business development. The early bird registration fee is $375, down from $425 charged for last year's event. Click the link for more information … * SACRAMENTO, Calif. (8/6/09)--The Golden 1 CU announced Monday it will offer Federal Housing Administration (FHA) loans for the first time (The Sacramento Bee Aug. 4). The loans, often used by first-time homebuyers, require a 3.5% down payment. During May, FHA loans financed 40.9% of all home purchases in Sacramento County, according to research firm MDA DataQuick. The Golden 1 CU, based in Sacramento, has more than $6.9 billion assets … * HARAHAN, La. (8/6/09)--Louisiana credit unions broke their record by raising more than $111,900 for the Credit Union Legislation Action Committee (CULAC) to date, with more than $25,900 raised during the Louisiana Credit Union League's 75th Annual Meeting and Convention July 30-Aug. 1 in New Orleans. Nine credit union chapters competed to raise the funds. The Alexandria Credit Union Chapter received the "CULAC Challenge Champion award for raising 735% of its goal. West Orleans Chapter raised the most money--$21,900. Susan Leake, president/CEO of La Capitol FCU, Baton Rouge, was the highest individual contributor. Eight of the league's nine chapters, plus league staff, surpassed their 2009 CULAC goal, said the league …

CUs must do more than marketing to reach Hispanics

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MADISON, Wis. (8/6/09)--Roughly 20% of U.S. credit unions already have or are planning Hispanic outreach programs, according to the Credit Union National Association (CUNA) and its new Hispanic outreach partner, Coopera Consulting. In 2006, credit unions spent $37 million in marketing to Hispanics. But not all of that money may have been effectively spent, because credit unions who want to reach Hispanic consumers need to do more than just translate their slogans and marketing materials from English to Spanish, according to Warren Morrow, Coopera Consulting CEO. During a briefing of CUNA staff about its partnership with Coopera, Morrow provided examples of how Coopera helps credit unions that are ready to serve Hispanics to culturally translate their marketing messages, instead of literally translating them. Credit unions’ Hispanic outreach efforts should engage in more than just translations, he said. To help credit unions more effectively reach Hispanics--which present a significant growth opportunity for the credit union movement--CUNA is working with Coopera to develop products and services credit unions can use for Hispanic outreach, including:
* Assessments; * Training; * Consulting; * Translations and * Hispanic Consumer Products.
Credit unions in today’s economy face challenges like declining membership growth, increased regulatory scrutiny, aging memberships, growth of the fringe financial service providers and corporate challenges--which can divert their attention from the future. But it’s important for them to seek and take advantage of new opportunities--such as reaching Hispanics--to find “new vital members and employees,” Morrow said. Hispanics are important to credit unions because they are the largest, fastest-growing, youngest and most underserved population in the U.S. By 2050, the Hispanic population is expected to reach 103 million. Hispanics also represent about half of people entering the U.S. work force and have a purchasing power of nearly $1 trillion, Morrow said. Though Hispanics represent a significant part of the U.S. workforce, they are financially underserved. Only about half have traditional relationships with mainstream financial institutions--compared with about seven of eight individuals in the U.S. general population. Many Hispanics use fringe service providers such as check cashers, remittance shops and pawn shops--which charge high fees, Morrow said. Helping Hispanics not only fulfills the credit union philosophy--it also presents credit unions with revenue and growth opportunities. Financially healthy members can lead to financially healthy credit unions and leagues, Morrow added. CUNA recently created a strategic partnership with Coopera, a subsidiary of the Iowa Credit Union League, to provide products and services to help credit unions serve the Hispanic market. For more information, use the link.

Louisiana pro volunteer marketing awards announced

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HARAHAN, La. (8/6/09)--The Louisiana Credit Union League has announced the
Glen Beard, Louisiana Credit Union League board chairman, presented Kathi Gill, president/CEO of Neighbors FCU in Baton Rouge, with the league’s Professional of the Year Award.
Kenneth Villemeratte (left) received the Louisiana Credit Union League’s Volunteer of the Year award. Glen Beard, league board chairman, presented him the award at the league’s annual convention last week. (Photos provided by the Louisiana Credit Union League)
recipients of its credit union professional, volunteer and marketing awards. The awards were presented at the league’s annual meeting and convention last week. Kathi Gill, president/CEO of Neighbors FCU in Baton Rouge, received the Professional of the Year Award. Kenneth Villemeratte with Lafayette Schools FCU was named “Volunteer of the Year.” Villemeratte has volunteered at the credit union for 18 years. The league also recognized six credit unions with Excellence in Marketing Awards for outstanding credit union marketing and communications efforts. In the $20 million assets and under category, winners included:
* Barton Plant FCU, Boutte, Best Newsletter; * CUSA FCU, Covington, Best Annual Report; and * St. Jules CU, Lafayette, Best Website.
Winners in the $20 million to $60 million asset category were Access of Louisiana FCU, Westlake, Best Newsletter and Best Annual Report; and Keypoint FCU, Baton Rouge, Best Website. Awards in the $60 million asset category were given to CSE FCU, Lake Charles, Best Newsletter and Best Annual Report; and Louisiana FCU, LaPlace, Best Website.

Western CUNA Management School honors graduates

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CLAREMONT, Calif. (8/6/09)--Four students graduated with “High Honors” and were inducted into the Academic Hall of Fame, while nine others graduated with “Honors” at the 48th session of Western CUNA Management School (WCMS) held July 12-23 at Pomona College in Claremont, Calif. Of 330 students attending this year, 78 were first-year students, 125 were second year and 127 were third year. During a three-year period, students have five opportunities to earn academic honors. Honors and High Honors are awarded to the highest achievers on both examinations taken at the end of each school year and the analysis of each of their two projects. To be inducted into the Academic Hall of Fame, students must receive honors in five out of five categories. Students earning High Honors were:
* Michael Gay, California; * Michael George, California; * Ryan Olsen, Washington; and * Karen Zerger, Oregon.
This year’s Honor students were:
* Jana Ayres, Washington; * Richard Dugan, California; * Jennifer Evans Thompson, Washington; * Krista Ferndelli, Colorado; * Brandy Fielding, California; * Maile Gushiken, Hawaii; * Jennifer Kato, California; * Steve Pratt, Utah; and * Daryl Rother, Washington.
This year’s Charles M. Clark Memorial Award went to Wayne K. Jorgensen of America First CU, Riverdale, Utah. Each year, the senior class nominates one student who best represents high moral character, leadership, credit union dedication and academic achievement to receive this award.
Click to view larger image Brett Martinez, president/CEO of Redwood CU in Santa Rosa, Calif., received the James D. Likens Alumni Recognition Award at the 48th session of Western CUNA Management School, July 12-23 in Claremont, Calif. (Photo provided by the California Credit Union League)
The third-year graduating class donated $56,200 to WCMS, in addition to $12,175 raised from this year’s silent and live auctions. Brett Martinez, CEO of Redwood CU in Santa Rosa, Calif., and current California Credit Union League chairman, was named the 19th recipient of the James D. Likens Alumni Recognition Award, founded by the Alumni Association of Western CUNA Management School. Martinez was recognized for his credit union career and commitment to the Children’s Miracle Network’s CU for Kids program. Troy Stang, president/CEO of the Credit Union Association of Oregon, delivered the commencement address at the July 23 graduation ceremony. “Our management skills are being tested,” he said. “We all have an important lesson to learn, and that is to respect ourselves. We have to also remember, it’s not our abilities, but our choices in life that matter.” This year’s students were from 17 states.

Fraud report Call center fraud is evolving

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BEDFORD, Mass. (8/5/09)--Cybercriminals are infiltrating the call center, with scams evolving into a new criminal professional call service that can spoof any number in the U.S. and offer cash out in multiple languages. According to RSA Anti-Fraud Command Center's monthly Online Fraud Report for June, the service enables phone numbers to be customized depending on the state where the account holder resides. It also enables fraudsters to accept incoming calls, posing as the genuine account holder. "Service providers in the underground have evolved phone fraud services into a singular location to provide other fraudsters with the ability to conduct phone channel fraud to any destination and in any language," the report said. The service helps the cybercriminals to increase their profits while significantly lowering the risk of exposure, said RSA. Other findings for June:
* More than 13,000 phishing attacks were identified, a 10% increase from May and the highest in 11 months; * Attacks against credit union brands remained constant--at 18%, the same as in May. After peaking at 38% of attacks in February, attacks against credit unions dropped to 22% in March and 14% in April. * Attacks against regional bank brands increased 60% while national brand attacks dropped more than 50%; and * Fast-flux attacks, the denial of service using sophisticated networks of computers called botnets, increased by 5% to make up 56% of the hosting methods of attacks. Hijacked websites accounted for 26% of the attack methods.

CUSO applauds NCUAs letter on short-term loans

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LENEXA, Kan. (8/5/09)--A credit union service organization (CUSO) that specializes in payday lending alternative loans is commending the National Credit Union Administration's (NCUA) letter encouraging federal credit unions to service their members' small loan needs. The letter was released last week. The number of credit unions offering payday lending alternative loans has grown from about 50 a few years ago to more than 250 now, according to NCUA. Lon Neofotist, managing director of XtraCash LLC, the CUSO, said the letter underscores the reasons why the organization was formed: to provide a risk-free, affordable alternative to payday lenders, and to make a difference for the members by providing a lower-cost alternative and a pathway to financial stability. Nationally, more than 19 million U.S. households use payday loans, which total more than $42 billion annually, said XtraCash. "Credit unions should indeed 'step to the plate' and offer small dollar loans to their members," said Neofotist. "However, at 18% APR (annual percentage rate), the interest earned on a $100 loan computes to roughly 69 cents for a standard 14-day loan term. While credit unions should make it as affordable as possible, they should do so without having other members absorb the cost. At 18% APR, other members must subsidize the costs to process and service these loans," he added. The CUSO noted that payday lending APRs are much higher than standard loan rates because they are short-term, high-risk, high-loss loans. "Xtracash fully discloses fees as a dollar amount and as an APR on its website, as well as in all loan documents, so members are fully aware of the costs of the loans and are not misled," Neofotist said. Neofotist said that the CUSO has saved members and credit unions more than $1 million and assisted in providing member financial literacy. Members using XtraCash can complete more than 800 hours of online financial education. "Through this education and counseling, we are striving to move the member away from short-term loans and turn them toward more mainstream, lower-cost products and services," he said. He noted that XtraCash is already following several suggestions in NCUA's letter, which mirror the Community Financial Services Association of America (CFSA) Best Practices. They include:
* Clear and full disclosure of cost, both as a dollar amount and as an APR; * No false, misleading or deceptive advertising; * Encouragement of consumer responsibility; * Limit on the number of roll-overs allowed; * Right to rescind at no cost; and * Repayment over a longer time period/extended payment plans provided to consumers.

Efforts add depth to IUSA TODAYI payday loan update

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WASHINGTON (8/5/09)--Efforts by the credit union movement Monday resulted in a second, more comprehensive and more positive article in Tuesday's USA TODAY about credit unions' short-term loans or payday loan alternatives. The newspaper received a number of comments from consumers questioning an article in Monday's issue, which quoted a consumer group as saying that some loans at credit unions weren't a good deal. Many thought the article was prompted by banks; others criticized basing the article on a single credit union example. Tuesday's article, which features broader credit union perspectives, included Credit Union Development Educator Lois Kitsch responding to the consumer group's criticism. Kitsch is program coordinator of the National Credit Union Foundation's (NCUF) REAL Solutions program. The program helps low- and moderate-income people with their finances so they can accumulate more wealth. Some credit unions working with REAL Solutions offer short-term loans or payday loan alternatives to help get people off the payday loan debt cycle. NCUF Executive Director Steve Delfin spent part of the day Monday providing background perspective about the program to personal finance writer Sandra Block, author of both articles. In the second article, Block wrote that credit unions provide options to payday loans "in response to concerns that many low-income credit union members were relying heavily on payday loans. "Ideally, a credit union loan should offer a low-cost alternative to a payday loan, and many do." But she also advised scrutinizing the details. Credit unions' short-term loan programs featured in the article, included Kinecta FCU, Manhattan Beach, Calif., and Prospera CU, Appleton, Wis. Kitsch noted that virtually all credit unions offering the loans prohibit rollovers, many give members longer time to repay their loans, and many tie their short-term loans to financial education programs to help members out of the debt cycle. Monday, the Credit Union National Association worked to help leagues and credit unions address requests from other media responding to the initial USA TODAY article. Scott Earl, CEO of the Arizona Credit Union League, told a local station KTAR Monday that borrowers come out ahead by using a credit union payday loan alternative--even with minimal fees that cover the cost of staff time with the loan. "If you borrow money for 30 days versus borrowing it for five years, the staff time to get that done is still about the same," Earl said. He also noted that credit union loans work to help the member boost their credit score. NCUF also is appealing to credit union development educators to spread the good news about credit unions by posting comments on any column related to credit unions, using the newspaper's Twitter account, and weighing in on the discussions on blogs and listservs. It also advised putting a human face on such complex issues, by using first-person stories from members and entering them in REAL Solutions' video contest, and noted it has a Payday Lending Toolkit with examples of credit unions offering sound payday lending programs.

Savings challenge pays off for six Wisconsin families

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RACINE, Wis. (8/5/09)--Six families who embarked in September on a Savings Challenge created by Educators CU in Racine Wis., have increased their savings by more than $21,000 and reduced their collective debt by more than $49,000. The families also increased their collective credit scores by 533 points, said the $1 billion asset credit union (The League Aug. 4). With help from a financial coach, all the families set a goal to increase their savings by 10% and reduce their debt by 3%. Each family developed a spending plan and attended monthly financial education workshops conducted by the credit union. The family that achieved its goals would be awarded a grand prize of $10,000. However, when four families reached their goals, Educators’ board of directors decided to award each family $10,000. “It was wonderful to see what families did and how much they achieved,” said Educators spokeswoman Shannon Huot. “We just wanted to reward all four families for their hard work.” The other two families each were awarded $2,500. To involve its membership and community in the challenge, the credit union shared monthly interviews with each family through videos, podcasts, blog posts and webinars posted on the credit union’s website and also provided an at-home version of the challenge. The at-home version asked participants to fulfill requirements similar to the main challenge. They included creating a spending plan, setting a financial goal, opening and maintaining a VIP savings account and attending three of the credit union’s financial education workshops. At the end of the challenge, at-home participants had a chance to win $1,000, $750, $500 or $250. Although the first challenge has ended, the credit union intends to help more members during its second Savings Challenge, which is slated to begin this fall.

Maine CUs grow during first-half 2009

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WESTBROOK, Maine (8/5/09)--Maine credit unions experienced significant growth in the first half of the year and even more robust growth during the past twelve months, according to statistics from the Maine Credit Union League. For the six-month period ending June 30, combined assets of Maine’s 67 credit unions topped $5 billion for the first time, increasing 5.95%. Loans grew 1.16% despite a slowdown in loan demand. Shares/savings climbed 7.75% with members depositing more than $307 million in the state’s credit unions during the first half of 2009. Also, membership at the credit unions rose by more than a full percentage point to 608,187--the largest membership growth in several years. The state’s credit unions had a net gain of 6,328 new members since the beginning of the year. Since June 2008, assets at Maine credit unions have increased 7.77%, loans increased 4.00% and shares/savings surged 7.82%. Nationally, Maine has been ranked the fifth strongest credit union state for the past seven years. John Murphy, league president, called the statistics “validation of the positive impact and leadership role of credit unions during this difficult economic period. “As we move forward and begin to emerge from this recession, Maine’s credit unions are well-positioned as sound financial institutions that will be remembered for developing a number of creative programs to provide valuable assistance to members during a period of great need,” Murphy said. “Credit unions will be an important participant in the new economy offering consumers a full menu of the latest technology-based products available, the convenience of shared branching, a surcharge-free ATM network, along with a comprehensive offering of consumer, mortgage and small business loans and related services,” he continued. He noted, “A recent study, which found that Maine consumers saved $73 million last year by using a credit union, underscores the value of using a credit union.”

CU System briefs (08/04/2009)

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* HARRISBURG, Pa. (8/5/09)--Norb Kaczmarek, Pennsylvania Credit Union Association (PCUA) director and president/CEO of Erie FCU, and Mary Beth Wilcher, Erie FCU chief operating officer, met with U.S. Rep. Kathy Dahlkemper (R-3) to discuss credit union issues (Life is a Highway Aug. 4). They discussed member business lending (MBL), interchange legislation, fraud and small business lending. PCUA also encouraged credit unions to meet with their constituents for support for an MBL bill introduced by Rep. Paul Kanjorski (D-Pa.). The bill would more than double the current MBL cap of 12.25% for credit unions ... * FRESNO, Calif. (8/5/09)--Despite a troubled economy, Pacific Service CU in Fresno, Calif., donated more than $50,000 to nonprofits throughout Northern California between January and June 30. The donations helped provide more than 1,500 meals and 2,000 hygiene kits at Sanctuary Youth Services, the credit union said. Pacific Service also donated to the Easter Seals Child Development Center, City of Fresno Crime Prevention, Diabetic Youth Foundation and the Salvation Army. The credit union has more than $1 billion in assets ... * LANSING, Mich. (8/5/09)--Ninety-five Michigan credit union golfers participated in the CURE Golf Outing July 29 in East Lansing, an event to boost legislative advocacy and sponsored by 40 sponsors (Michigan Monitor Aug. 3). They raised $29,025 for scholarships for credit union staff to attend key grassroots advocacy events. Last year's event raised $28,425. The first place team, pictured here are, from left, Ron Darling of Lansing Automakers FCU (LAFCU); Doug Burroughs of CUNA Mutual Group; and Tommie Culpepper and Robin Frucci of LAFCU. ((Photo provided by the Michigan Credit Union League) … * DES MOINES, Iowa (8/5/09)--A man wearing a black veil robbed Federal Employees CU in Des Moines, Iowa, Mondaye. The man took an undisclosed amount of money. He did not use a weapon ( Aug. 4). Federal Employees CU of Des Moines has $13.7 million in assets ... * LANSING, Mich. (8/5/09)--Cheryl L Hurley, president/CEO of Motor City Co-op CU, died July 26 after a short illness, according to the Michigan Credit Union League. Hurley began her career at the $104.5 million-asset credit union based in Clinton Township in 1971 as a part-time teller. Seventeen years later, she was named CEO. She held various positions at the credit union, including payroll clerk, assistant manager and executive vice president. Hurley served as a director on the board of Mortgage Center LLC and on the executive committee of the Northeast Chapter (now Metro East). She is survived by her husband Drew, two children and four grandchildren (Michigan Monitor Aug. 3) …

La Pine takes helm of League of Southeastern CUs

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TALLAHASSEE, Fla. (8/5/09)--The League of Southeastern Credit Unions (LSCU) welcomed Patrick La Pine to its Florida offices Monday to begin his tenure as president/CEO of the league, created by the consolidation of the Florida and Alabama Credit Union Leagues. La Pine replaces retiring CEOs Guy Hood of the Florida league and Gary Wolter of the Alabama league. La Pine, previously executive vice president of association services at the Michigan Credit Union League, said he believes strongly in advocacy and service to LSCU's members. "Everything we do as a league will begin and end with what is in the best interest of our member credit unions in mind," said La Pine. "'Advocacy and Information' (legislative, regulatory/compliance, communications and education) will be the cornerstone of our new association." La Pine will spend the first several months dividing his time between the Tallahassee and Birmingham offices to get to know staff and better understand both leagues' functions. The league is also setting up town hall meetings across both states to provide opportunities for credit unions to meet and spend time with him. "I look forward to working with staff and our members as we mold the new LSCU," he said. "I start this job with two very strong and solid beliefs: a profound love for credit unions and the job they are doing every day to enrich the lives of their members, and the pride I feel in being given the opportunity to lead this organization and the people who work for it." The combined league represents 332 credit unions with $55 billion in total assets.

CU System briefs (08/03/2009)

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* FLORENCE, S.C. (8/4/09)--A local newspaper gave Health Facilities FCU, based in Florence, S.C., a "thumbs up" for its "Don't Just Save a Tree, Plant One" campaign. This past spring, the credit union offered members a chance to sign up for eStatements and give back to the city, Keep Florence Beautiful and The Arbor Foundation by planting trees. "I never would have imagined that we would be planting 155 trees in Florence," Michelle Bailey, the credit union's marketing manager, told Morning News (Aug. 3) … * TALLAHASSEE, Fla. (8/4/09)--Three families are leading Florida Commerce CU's weLiveFIT! Challenge competitions, announced the credit union at a live show July 26 at a local Sam's Club in Tallahassee. Seven Tallahassee families are halfway through the 10-month competition toward financial fitness, which began in March. The households are competing to save money, reduce debt and improve their credit scores. More than 100 families applied for the competition. Each of the seven families chosen are assigned a financial coach to help them develop a personalized plan. They share their progress with the community through blogs and monthly webisodes. The household that improves finances the most at the end of the challenge will receive $10,000. Ann Nucatola, host of the weLiveFIT! Challenge reality show, announced the three families leading so far: David and Linley Paske, Karen Rubin, and Diana and Michael Grosh. Winners will be announced in January … * HARRISBURG, Pa. (8/4/09)--Belco Community CU based in Harrisburg is celebrating the one-year anniversary of its Critter Club, an account created for pets. To celebrate, employee and members donated $1,272 to three local animal shelters. In addition to the funds raised, they filled two truckloads of supplies, which were delivered to the Lancaster Humane League, Humane Society of the Harrisburg Area and Adams County SPCA. Employees raised funds through jeans days. Also, a team of employees took part in the Humane Society of Harrisburg's Run/Walk for the Animals (Life is a Highway July 30) … * RALEIGH, N.C. (8/4/09)--State Employees' CU (SECU) foundation, SECU Foundation, presented a $10,000 four-year college scholarship each to three Edgecombe County 2009 graduates for a total of $30,000 in award money. Recipients are SouthWest Edgecombe graduate Morgan Danielle Drake, North Edgecombe graduate Tierra Shadeh Hammiel and Tarboro High graduate Cassie Dieterich Hutaff. Drake will attend North Carolina State University; Hammiel will attend University of North Carolina at Chapel Hill, and Hutaff will attend University of North Carolina at Charlotte. SECU, a $17 billion asset credit union, is based in Raleigh, N.C. …

Members United reports 81.9M in OTTI

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WARRENVILLE, Ill. (8/4/09)--Members United Corporate FCU reported an $81.9 million loss in other than temporarily impairment (OTTI) funds in its June financial report, just released. That means its net loss for the month will be $79.3 million. At the time of the report, Members United had not applied the losses to member capital because it was waiting for the audited financials from U.S. Central FCU. Members United attributed the losses to the downgrading of several monoline insurers who continue to experience significant losses from guarantees they made on credit default swaps (CDS) and collateralized debt obligations (CDO) backed by residential mortgage securities. The corporate does not own any CDOs or hold any CDS contracts. Two monoline insurers, FGIC and Syncora Guarantee (SGI), were deemed permanently impaired and RMBS securities wrapped by these insurers were subjected to OTTI. Also, MBIA and Ambac have experienced ratings downgrades and their credit spreads are trending unfavorably, said the corporate's financial statement. Assets at Members United as of June 30 totaled $8.4 billion. Cash and overnight deposits at U.S. Central FCU totaled $2.8 billion, fair value of marketable securities represented $3.5 billion, loans to members totaled $0.9 billion, and term deposits at U.S. Central totaled about $1.1 billion. Members United's capital ratio stands at 3.93%--below the 5% regulatory requirement. However, the National Credit Union Administration issued an order recently allowing corporates to reference their Nov. 30, 2008 capital levels, which exceeded the 5% requirement for Members United. To access the report, use the resource link.

Guard fires shot robber flees

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ROCKFORD, Ill. (8/4/09)--A would-be robber fled the Rockford, Ill. branch of a credit union, after a credit union guard shot at him and missed. Rockford police said a man in his late teens to early 20s entered the branch of the Rantoul, Ill.-based Credit Union 1 at about 1 p.m. Friday, pointed a long-barreled handgun at the uniformed guard who was seated at a desk, and told her to "freeze." Instead, the guard drew her gun and shot at him, hitting a front window. The man fled, without any money ( July 31).

Suspicious powder in envelope turns out to be drywall

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TUSTIN, Calif. (8/4/09)--A suspicious white powder found in an envelope deposited at a California credit union has turned out to be drywall dust, officials said. Authorities were called to Schools First FCU at 8:15 a.m. Monday after an employee found the powder inside a deposit envelope (The Orange County Register Aug. 3). Two people exposed to the powder were isolated and checked by paramedics as a precaution. They did not experience any illness symptoms, said Sgt. Jeff Blair of the Tustuin Police Department. At 11:35 a.m. the hazardous materials crew determined the substance wasn't hazardous.

CUNA CUs consumers rebut IUSA TODAYI item

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NEW YORK (8/4/09)--The Credit Union National Association (CUNA) is providing resources so leagues and credit unions can answer questions that may be prompted by a front-page article in Monday's USA TODAY that was critical of some credit unions' payday loan alternatives. The article cited the loans of a single credit union in Nevada. The article alleged that some payday loan alternatives at credit unions are "not a good deal." The article quotes an attorney for the National Consumer Law Center (NCLC), who said many credit union payday loan alternatives really help consumers but others are only marginally cheaper than traditional payday loans. The story was sparked by an NCLC statement about the National Credit Union Administration's letter of guidance to credit unions on payday lending (see News Now July 30). Lois Kitsch, national program director for REAL Solutions, a program of the National Credit Union Foundation (NCUF), was interviewed for the article and countered the negative claim. Many credit unions offering the alternative loans encourage savings and allow up to 90 days to repay the loan, instead of the traditional 14-30 days, she told the newspaper. She also was interviewed Monday morning on CBS about the programs, according to NCUF. CUNA, in providing statistics, background papers and talking points for the leagues, noted that between 10% and 20% of credit union members opt to do at least some business with a payday lender, for a variety of reasons. "Consumers clearly show a need for short-term cash loans they can access quickly. Credit unions are offering reasonable and more consumer-friendly alternatives to the typical payday loan," said Dan Mica, CUNA president/CEO. He noted credit unions are a logical choice--they have a history of providing small loans to help their employer-based memberships get by until payday. "Credit union alternative payday loans are designed to help members break their payday loan habit by helping them pay off the loan," Mica said. No two short-term loans are alike at credit unions because they are customized to fit their membership's needs, which vary from credit union to credit union, he added. Of the credit unions offering payday loan alternatives, roughly 60% use open-end credit terms, while closed-end terms extend to 30, 60, or even 90 days, according to CUNA's statistics. More than nine out of 10 credit unions offering the loans require them to be paid in full before the member is provided another advance. NCUF told News Now that when the article's author contacted the organization Friday, it did not have the opportunity to provide significant background information or links to other credit unions' payday loan alternatives. On Monday, NCUF provided additional information to the writer about credit union payday lending alternatives for a future article. A few state leagues noted the newspaper article in their daily newsletters. "The story unfortunately did not do a good job in capturing all the great work credit unions do to make affordable short-term loans available. It sourced only one credit union," said New Jersey Credit Union League President/CEO Paul Gentile (The Daily Exchange Aug. 3). "The issue of whether a fee should be viewed as APY (annual percentage yield) has been debated for years with overdraft programs and short-term loans. The fact is many credit unions are making short-term loans that others won't and they are doing them to help their members through tough times." He pointed out that the article "does not provide an example of a credit union using a true payday loan alternative." Readers clogged up the newspaper's comment blog with a variety of opinions on the article. Many were favorable to credit unions. While no one professed to like their bank's products, several said they preferred their credit unions. "I've been with credit unions for almost 30 years. A bank will NEVER get my business," said one commenter.

Moving company loses box of CUs data

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MEDFORD, Mass. (8/4/09)--A moving company lost a box last year containing account information of nearly 10,000 Massachusetts members of Members Plus CU, Medford, Mass., the credit union said. Members Plus hired Olympia Moving and Storage to manage a 2008 move to a new location and rented boxes for the move from Rent-A-Crate, the credit union said in a letter sent to the state’s Office of Consumer Affairs and Business Regulation (The Boston Globe Aug. 3). On Sept. 19, Rent-A-Crate notified the credit union that one of it boxes wasn’t returned. Initially, Members Plus thought the box company’s count was incorrect. But then on April 1, the credit union discovered that a box containing unencrypted discs of account statement images--including Social Security numbers of some former credit union members--was missing, the newspaper said. After searching all of its offices, including its previous location, Members Plus could not locate the missing box. In May, the credit union told the state it had “no evidence or reason to believe that the lost information had been misused, accessed or acquired by unauthorized access,” the paper said. Members Plus did not return a phone call to News Now by press time.

Michigans Save to Win garners prominent coverage

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PLYMOUTH, Mich. (8/4/09)--The Michigan Credit Union League’s Save to Win program was the topic of a recent Fox Business News story in which league President David Adams was interviewed. The program also has been noted by The New York Times and the Wall Street Journal. Save to Win is a program piloted by eight Michigan credit unions that offers credit union members the opportunity to win prizes for each $25 they deposit into savings accounts. Since the pilot launched in January, $4 million has gone into savings, with an average deposit of $300. Many of the people participating are individuals who have never saved before and played the lottery or gambled with their money. The pilot is appealing to individuals’ desires to play a game--but in a productive way, Adams said. “People need incentives to save,” Adams told Fox Business News. “We are borrowing too much, and saving too little. [But] the more we save, the more prepared we’ll be for the future.” The Save to Win program was made possible through a partnership with the Filene Research Institute and the D2D fund. For more information, use the links.

MnCUN to IStar TribuneI CUs well capitalized

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MINNEAPOLIS (8/4/09)--Credit unions are well capitalized, Mark Cummins, Minnesota Credit Union Network president/CEO, said in a response to a recent article in the Minneapolis Star Tribune. The newspaper published an article July 27 that highlighted some of the lending challenges credit unions have recently encountered. The newspaper said some credit unions engaged in risky lending and are losing money. The article did not clarify that those credit unions’ difficulties were anomalies in the industry, as only a handful were involved in risky lending practices, Cummins said. “Minnesota credit unions have a long and proud history of lending conservatively to their members,” Cummins said. “In fact, only 2.5% of the state’s credit unions have capital levels that are below what regulators consider to be adequately capitalized.” As of March 31, the capital ratio for Minnesota credit unions was 9.8%, above the 7% threshold set by the National Credit Union Administration, he added. Money that credit union members have on deposit is insured up to $250,000. “There is no problem that could occur in the credit union industry that cannot be handled by the existing deposit insurance system,” Cummins said.

First Global Womens Leadership Forum held

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BARCELONA, Spain (8/4/09)--About 40 women leaders in the global credit union movement met last week as part of the Global Women's Leadership Network, immediately following World Council of Credit Union's (WOCCU) World Credit Union Conference in Barcelona, Spain.
Click to view larger image Kimberley Ney of Alterna Savings & Credit Union in Canada, and forum facilitator Susan Mitchell applaud the comments of another participant at a one-day forum of the Global Women's Leadership Network, held after World Council of Credit Unions’ (WOCCU) World Credit Union Conference in Barcelona, Spain, last week.
Click to view larger image Chetna Sinha of Mann Deshi Women's Bank in India shared her leadership experiences with fellow Global Women’s Leadership Network forum participants. (Photos provided by World Council of Credit Unions)
The network, launched earlier this year by WOCCU with the Canadian Co-operative Association (CCA), is the first of its kind. It brings together women credit union leaders from more than 15 countries to connect, share ideas and participate in a peer advisory program. Network members met during an inaugural one-day forum Thursday to discuss leadership issues vital to credit union growth and development worldwide. Members included CEOs, executives and board directors from credit unions and industry partners. Countries represented ranged from Australia and Belarus to Mexico and Zimbabwe. “Women worldwide play an active role in finance and economics,” said Chetna Sinha, founder and chair of India's Mann Deshi Women's Bank, network member and forum participant. “It is very important that women occupy a leadership role in this industry because women's financial leadership capabilities are extraordinary.” Despite operating in different environments, the attendees found they faced similar leadership challenges in their credit unions despite the fact their credit unions are run differently. The women discussed the critical impact they have in society and challenges they face in leadership positions. Participants also broke into small groups to discuss in-depth strategic issues such as growing market share and facilitating greater access to credit unions worldwide. WOCCU and CCA are raising funds to offer women in both developed and developing countries greater access to credit union resources that will enable them to lead in the economic development of their communities. The network provides financial support for development efforts aimed at increasing access to financial services for women in field programs. Leaders who join the network can access the peer advisory online forum and receive periodic updates on women in credit unions. “Women play a vital role in the economic well-being of families and communities worldwide,” said Brian Branch, WOCCU executive vice president and chief operating officer. “The Global Women's Leadership Network will empower women not only to increase their effectiveness, but also to bring their leadership capabilities to the forefront. And that will benefit everyone.” The 2010 Global Women's Leadership Forum will take place in Las Vegas with The 1 Credit Union Conference to be co-hosted by WOCCU and the Credit Union National Association in July. For more information, use the link.

Top 10 INews NowI stories for July

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MADISON, Wis. (8/4/09)--Here are the top 10 most requested News Now stories during July. Use the links to read the stories online. 10. CUNA pursues CARD Act compliance solutions WASHINGTON (7/30/09)--CUNA continues its efforts to address what is for credit unions a troublingly short compliance framework for new Federal Reserve Board rules implementing the Credit Card Accountability, Responsibility and Disclosure (CARD) Act. 9. Fed addresses CARD Act compliance problem WASHINGTON (7/16/09)--The Federal Reserve Board Wednesday issued an interim final rule under the Credit Card Accountability, Responsibility and Disclosure (CARD) Act and included supplementary information that addresses a problem regarding sending out statements 21 days before a payment is due. 8. CUNA sets July 28 audio call on CARD Act notice provision WASHINGTON (7/20/09)--On July 28 at 1:30 p.m. (ET), the Credit Union National Association (CUNA) will hook up interested credit union representatives with financial industry experts who will address concerns about a 21-day notice period under the Credit Card Accountability, Responsibility and Disclosure (CARD) Act. 7. Two more file suits on CUNA Mutual’s credit disability RAPID CITY, S.D., and GREENVILLE, S.C. (7/10/09)--Two more credit union members have filed suits against CUNA Mutual Group and CUNA Mutual Insurance Society regarding credit disability benefits. 6. GM, Chrysler CU discounts to continue through year-end LANSING, Mich. (7/13/09)--General Motors and Chrysler credit union member discounts as part of the "Invest in America" program will continue through the end of the year, the Michigan Credit Union League announced Thursday. 5. Class action suit filed against CU over investments MIAMI (7/7/09)--Attorneys for a Florida woman have filed a class action lawsuit against a Boca Raton-based credit union and four individuals that alleges they lost millions of dollars by investing in a now-defunct company that the suit terms was "a bucket shop rife with fraud." 4. Pope’s financial crisis encyclical cites CUs, love MADISON, Wis. (7/10/09)--Love and credit unions function in the same manner, said Pope Benedict XVI Tuesday in his third encyclical, "Charity in Truth," which focused on the economy, business and finance. 3. Fed explores big Reg Z changes WASHINGTON (7/24/09)--The Federal Reserve Board has proposed several major changes to Regulation Z (Truth in Lending) that would modify the disclosures required of lenders for closed-end mortgage loans and home equity lines of credit. 2. Four CUs hit by insider embezzlement schemes MADISON, Wis. (7/10/09)--Credit unions experienced a rash of insiders accused or convicted of embezzlement schemes this week. Four incidents involved a manager of a defunct credit union, a branch manager who also is a pastor, a loan officer and a clerk. The amounts taken totaled nearly $1.7 million. 1. Longer compliance time needed on CARD Act provision: CUNA WASHINGTON (7/8/09)--The Federal Reserve Board must give credit unions more time to comply with a provision of its expected rules to implement new credit card statutes if that provision is going to apply beyond credit cards, CUNA urged the federal regulator Tuesday.