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CUNA To Testify Wednesday On Duplicative Regs, More

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WASHINGTON (12/2/13)--The Credit Union National Association will testify Wednesday on a number of credit union issues, including duplicative and inconsistent federal rules.

Rose Bartolomucci, president/CEO of Towpath CU, a state-chartered, privately insured credit union in Akron, Ohio, will testify on CUNA's behalf before the House Financial Services subcommittee on financial institutions and consumer credit.
 
The hearing will focus on:
  • A bill to require federal financial regulators, including the National Credit Union Administration and CFPB, to assess whether proposed rules are duplicative or inconsistent with other federal rules, to take steps to address the duplication or inconsistency, and report to Congress within 60 days of issuing the rules;
  • A CUNA-supported bill that would permit privately insured credit unions to join a Federal Home Loan Bank; and,
  • A bill that would adjust the Consumer Financial Protection Bureau's rural designation to align with the definition used by the U.S. Department of Agriculture.
Rose is a member of the CFPB's Credit Union Advisory Committee. In 1998 she testified before the House Financial Services Committee on the landmark credit union bill, the Credit Union Membership Access Act.

NCUA Prohibits Three From Future CU Work

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ALEXANDRIA, Va. (12/2/13)--The National Credit Union Administration has banned three former credit union employees from participating in the affairs of any federally insured financial institution.

The NCUA said the orders involve the following individuals:
  • Carrie Bomyea, a former Glass City FCU, Maumee, Ohio, employee who pleaded guilty to embezzlement charges. Bomyea was sentenced to 18 months in prison, five years supervised release and ordered to pay restitution in the amount of $199,576.35;
  • Armelinda Castillo, a former WesTex FCU, Lubbock, Texas, employee who was convicted of misapplication of funds by a bank employee. Castillo was sentenced to 37 months in prison, five years supervised release and ordered to pay restitution in the amount of $690,000; and
  • Yolanda O'Keefe, a former Connecticut Community CU, Pawcatuck, Conn., employee who entered into a pretrial rehabilitation program for the charge of larceny. O'Keefe has been ordered to attend and complete a Gamblers Anonymous program, stay away from the credit union's premises, and complete 50 hours of community service. She is also prohibited from all casinos.
Violation of a prohibition order is a felony offense punishable by imprisonment and a fine of up to $1 million.

NCUA web site users can now access a new tool for searching agency administrative actions. Through the new tool, they can search prohibition and administrative orders by name, institution, city, state and year, the agency said.

Use the resource link to access all NCUA enforcement orders.

Freddie, Fannie Conforming Loan Limits Steady For Another Year

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WASHINGTON (12/2/13)--As Federal Housing Finance Agency acting director Edward DeMarco hinted in late October (News Now Oct. 28), 2014 maximum conforming loan limits for mortgages acquired by Fannie Mae and Freddie Mac will remain at $417,000 for one-unit properties in most areas of the country.
 
DeMarco said back in October that the FHFA would give at least six months' notice before lowering the statutory maximum, and said that it won't act until at least next spring. He said that any rule change would be "measured" to minimize market shocks.
 
The maximum conforming loan limits for one-unit properties, for loans purchased in 2014 and generally originated after Oct. 1, 2011 or before July 1, 2007, are $417,000 in most locations, but are as high as $625,500 in certain high-cost areas in the contiguous United States.  These numbers reflect the 2013 levels.
 
The loan limits are established under the terms of the Housing and Economic Recovery Act of 2008 (HERA) and are calculated annually.
 
HERA requires the loan limits to be set as a function of median home values in local areas: While some counties saw increases in home prices in 2012, no loan limit increases were evident after other HERA terms such as the statutory ceiling and floor were taken into account.

CUNA/CFA: Holiday Spending Expected To Increase This Year

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WASHINGTON (12/2/13)--More consumers plan to increase their spending during this year's holiday season, and fewer consumers plan to spend less than they did last year, according to the 14th annual holiday spending survey conducted by the Consumer Federation of America (CFA) and the Credit Union National Association.

Click to view larger image Credit Union National Association Chief Economist Bill Hampel (left) and Consumer Federation of America Executive Director Stephen Brobeck announce the results of their 14th annual joint survey on consumer holiday spending expectations. More than half (51%) of respondents with annual incomes below $25,000 said they would use most of a $5,000 windfall to pay down debt. Less than one-third (32%) of those with incomes above $100,000, said they would do the same. (CUNA Photo)
Since 2012, the percentage who said they would spend more than the previous year rose from 12 to 13, while the percentage who said they would spend less declined from 38 to 32. These changes continue the trend from 2011, when only 8% said they would spend more while 41% said they would spend less.

Nearly one-in-four (24%) said their financial situation was better this year than in 2012, while 29% said their financial situation was worse. The percentage of those who said it was worse was the smallest since CFA and CUNA began asking the question in 2009.

This year, 1,002 persons were interviewed by landline or cell phone between Nov. 7 and 10. 

The results are the strongest that the CFA/CUNA survey has seen since 2006, two years before the recession began, CUNA Chief Economist Bill Hampel noted. "Put differently, our holiday spending survey has shown five years of improvement in a row following the abysmal readings of 2008," he said.

"The survey suggests that holiday spending will increase at least as fast as last year. It is also encouraging that fewer Americans see their economic status as worsening, despite on-going federal budget issues in Washington," Hampel added.

The survey also revealed:
  • Men (15%) are more likely to increase spending than women (12%);
  • Respondents between the ages of 18 and 34 are more likely to increase spending than any other age group, with 27% saying they were likely to do so; and
  • African Americans (20%) and Hispanics (17%) were more likely to report increased spending plans than non-Hispanic Whites (12%).
Upper-income households were also marginally less likely to report an increase in holiday spending plans, and were also least likely to report a planned decrease in spending.

About one-half (51%) of survey respondents said recent controversies over federal government spending and borrowing had affected their holiday spending plans. Lower-income families were more likely to be affected by federal budget problems than high-income families.

The CFA and CUNA suggested that consumers looking to spend less this holiday season avoid impulse buying by sticking to a predetermined budget for gifts and other holiday items, use the Internet to comparison shop, and pay off any debts quickly.

Starting a holiday savings account or curbing spending by finding low- or no-cost ways to celebrate the holidays are also options, CFA Executive Director Stephen Brobeck said.

CUNA and CFA's tips to help consumers manage holiday debt, which traditionally accompany the survey findings, also note that holiday club accounts can be found at many credit unions, as can credit cards that typically have lower rates than those of other financial institutions.

Spending Survey Again Receives Strong Press Coverage

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WASHINGTON (12/2/13)--The release of the Credit Union National Association's and Consumer Federation of America's 14th annual projection of consumers' holiday spending plans garnered widespread press coverage, including a live broadcast on C-SPAN. Over the weekend, clips from the pre-Thanksgiving press conference unveiling the survey results were also broadcast regularly on NBC's Channel 4 in Washington, D.C.


Click to view larger image Cameras are set up for live and taped coverage of this year's CUNA/CFA spending survey release. (CUNA Photo)
Other broadcasting and print groups that attended or covered the press conference included:
  • NBC;
  • Hearst Television;
  • Fox Business Channel
  • The Washington Times;
  • Epoch Times; and
  • Cronkite News.
Westwood One Radio and CNBC's Big Data Download followed up with CUNA after the event. The event was also noted in the Wednesday morning edition of Politico's Morning Tax column, and National Public Radio's Planet Money.

The survey, which was unveiled during a Wednesday event at the National Press Club in Washington, D.C., found that more consumers plan to spend more than they did last year, while fewer plan to reduce their 2013 holiday spending. (See related story: CUNA/CFA: Holiday Spending Expected To Increase This Year.)

Paul Gentile, CUNA's executive vice president of strategic communications and engagement, said the survey release "helps spread the word about credit unions and reinforce that credit unions are a trusted resource for consumers."