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Radebaugh shares breach effect with congressional delegation

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COLUMBIA, S.C., and RALEIGH, N.C. (2/7/14)--John Radebaugh, CEO of the Carolinas Credit Union League, shared credit union concerns about data security with congressional delegations from North Carolina and South Carolina.
Prior to this week's lineup of committee and subcommittee hearings on data security and cybersecurity, Radebaugh sent a letter to each state delegation office, customized with state data.
"Credit unions...understand and appreciate the complexity of data security," he wrote, adding, "Our frustration with merchants, particularly in instances like the Target breach, is with lack of responsibility and accountability when a breach occurs" ( In the Loop Feb. 6).
Radebaugh recommended these objectives:
  • Subject merchants to the same type of data security standards that credit unions follow;
  • Require merchants to reimburse credit unions for the costs they incur as a result of merchant data breaches; and
  • Permit credit unions to identify the merchant at which a data breach occurs.
He added, "Perhaps most frustrating for credit unions is that the lack of merchant accountability leaves vulnerable the very heart of member relationships credit unions work so hard to build.
"When a merchant breach occurs and a credit union is unable to tell a member the responsible merchant's name, the member often assumes wrongly that the compromise is the result of negligence by the credit union," he said.
"It is only fair that we be allowed to offer greater reassurance and in doing so add incentive for merchants to protect consumer data."
The league will follow up with state delegations during the Credit Union National Association's Governmental Affairs Conference Feb. 23-27.
CCUL's advocacy and education efforts regarding data security going forward will include letters to the editor from Radebaugh, engaging credit unions within regional media markets and providing customizable templates for credit unions.

Ohio league makes progress on public deposits

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COLUMBUS, Ohio (2/7/14)--The Ohio Credit Union League reports that it continues making inroads with lawmakers on legislation that would permit credit unions to accept public deposits.
League General Counsel John Kozlowski and Director of Legislative Affairs Patrick Harris recently met with House Republican caucus staff to discuss The Community Access and Local Government Choice Act, the legislation that would provide credit unions with the authority to accept public deposits. During the meeting, Kozlowski and Harris asked that Ohio House Speaker Bill Batchelder (R-Medina) follow up on his support of bringing banks to the negotiating table to clear a path for public deposits legislation ( eLumination Feb. 5).
Also, with momentum building in the House, Harris and Kozlowski met with Senate Minority Leader Joe Schiavoni (D-Boardman) to discuss how the bill would fare in the Senate. Schiavoni suggested credit unions contact him should a vote in the House become imminent.
The Community Access and Local Government Choice Act is scheduled for proponent testimony Tuesday in the Ohio House State and Local Government Committee. Testifying in support of the legislation will be Ray Degraw, mayor of the city of Grandview Heights; Jim Link, former treasurer of Allen County and current clerk of courts; and Terry Scott, auditor for the city of Mount Vernon.

Harris will provide testimony on behalf of the league. Credit union staff and volunteers are encouraged to attend to show movement-wide support of the issue.

"We need to make sure we fill the room with credit union leaders so committee members understand how important this issue is to our movement," said Harris. "Banks will certainly be present in opposition."

Alabama GAC wraps up with legislative visits

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BIRMINGHAM, Ala. (2/7/14)--The Alabama Credit Union Association State Governmental Affairs Conference concluded Wednesday as credit union representatives pressed their case with state lawmakers on issues such as the state credit union act union act, patent trolling, and public deposits.
Before meetings at the State House, League of Southeastern Credit Unions staff updated attendees on bills in the Alabama legislature that are a priority for credit unions ( eSignal Feb. 6). The update to the Alabama State Act is moving forward, with the next action on the bill possibly coming next week. (See News Now Jan. 27: LSCU pushes for legislation on public deposits, foreclosures)
On the federal side, the league's federal contract lobbyist John McKechnie updated the group on tax reform, supplemental capital and regulatory issues. He said credit unions seemed very well positioned on tax reform, however unrelated business income tax (UBIT) might be on the table. He also said changing the name on the secondary capital issue to supplemental capital was a good idea because it implies helping credit unions and Congress wants to help entities.
GAC attendees were provided with a special welcome at the State House when they visited the Senate Chambers viewing gallery, where and the video board above the Senate floor read, "The Alabama Senate Welcomes the League of Southeastern Credit Unions."
Representatives from the LSCU and credit union representatives met with Rep. Phil Williams (R-Madison), who is the sponsor of a bill to limit patent trolling. Williams said he was pleased to talk to credit union representatives who have had first-hand experience with patent trolling.

CU System briefs (02/07/2014)

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  • CHARLOTTE, N.C. (2/7/14)-- Charlotte Metro CU aired two Super Bowl ads this year trumpeting the credit union's mobile banking services. The spots depicted two different couples at a tropical resort using smart phones and Charlotte Metro's mobile check deposit and person-to-person payment services ( Charlotte Observer Feb. 3). "We want consumers to know they can get the same mobile banking services at Charlotte Metro that they'd expect at a much larger institution," President/CEO Bob Bruns said. The ads, which featured the couples using mobile banking to cover for the husbands' mistakes, attempted a humorous slant. Vice President of Marketing Randall Beckwith explained that "comedy gets attention," adding that Charlotte Metro believes "these light-hearted ads will get noticed and stick with people." Beckwith also said that executives, including Bruns, played a significant role in developing the ad campaigns, as they do every year. This year, the credit union will also advertise on the radio, outdoors and online. Charlotte Metro is headquartered in Charlotte, N.C., and has $296 million in assets ...
  • BOSTON (2/7/14)-- Newly elected Boston Mayor Martin Walsh joined City of Boston CU this week. City of Boston announced Walsh's membership Thursday, saying that it looks forward to serving him and collaborating with him on community initiatives ( Daily CU Scan Feb. 6) ...
  • WICHITA FALLS, Texas. (2/7/14)-- Two credit union executives in Wichita Falls, Texas, were named to the city's Times Record News "20 Under 40" in 2013. Mark Casares , 32, loan officer at PosTel Family CU, and Teea Reed , 25, marketing and business development director at Union Square FCU, were recognized for their work, both at the office and in the community ( Leaguer Feb. 7). Casares, who became a head teller, loan counselor and loan officer for Postel Family in 2005, also works with the Big Brothers Big Sisters program. He also represents the Wichita Falls Chapter of Credit Unions through Cornerstone Credit Union League, and is said to be the youngest area chapter president in Cornerstone's 83-year history. He is also a member of the Wichita County Sheriff's Citizen's Academy Alumni Association, and has volunteered with the Zavala Hispanic Cultural Initiative and the Boys & Girls Club. Reed, a Cache, Okla., native, has worked with Children's Miracle Network, United Regional Healthcare System and has also volunteered with Big Brothers Big Sisters ...
  • PORTSMOUTH, N.H. (2/7/14)-- Peter Kavalauskas, president/CEO of Northeast CU, Portsmouth, N.H., Thursday announced his retirement . He will continue to lead the credit union until a replacement is found. Kavalauskas first joined Northeast CU, then called Northeast FCU, in 1978 as an assistant general manager. He became general manager in 1984 and rose to his current position the following year. Under his administration, the $918 million-asset credit union has expanded from three branches in southern New Hampshire to 15 statewide branches. "It has been both an honor and a privilege to serve such an outstanding organization and its membership for over 35 years," he said. Kavalauskas has also volunteered with the New Hampshire Credit Union League since 1982, the Vermont Credit Union League, and the New England Credit Union Executive Society ...

Electronic lien titling on N.J. legislative agenda

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HIGHTSTOWN, N.J. (2/5/14)--Electronic lien titling is among the top legislative priorities for the New Jersey Credit Union League during the new session of the state's Legislature, Chris Abeel, NJCUL director of government affairs told News Now .
Electronic lien titling (ELT) is moving on an administrative level within the state, and the league hopes to avoid legislation on the issue.
"We've been working with Motor Vehicle Commission, trying to nudge them along," Abeel said. "There is some legislation that would mandate that they complete it by a certain time, but we've stayed neutral on that legislation because we've developed what we think is a good relationship with MVC."
The greatest benefit of electronic titling is the efficiency gained in the elimination of the paper filing. Rather than storing titles in a vault, a credit union can locate a title electronically and have it ready for a member once the car loan is paid off. Credit unions can also eliminate some of the expenses required to handle and process paper titles. Under a paper process, a staffer may have to take a large batch of titles, look them up in a loan system and then match the two. ELT allows for an automated matching process based on the vehicle identification number.
That increased efficiency can save credit unions both time and human resources, Abeel said.
Legislation that would authorize credit unions to offer prize-linked savings to their members could also be introduced this session, Abeel said. "I'm optimistic in one respect: I don't think bankers would oppose it."
At the same time, credit unions are flush with deposits, Abeel said, and momentum for another deposits bill could wane after New Jersey credit unions helped pass legislation that authorized them to become eligible to accept municipal deposits in 2011.
Abeel also said a data breach bill that has been introduced in each legislative session since 2006--but not pushed because of heavy opposition from retailers--has been prefiled for the 2014 session, "and it might have legs," because the bill's sponsor is now the Assembly Speaker Vincent Prieto (D-32).
The bill would restrict the information that a retailer can retain from a card's magnetic strip. In case of a breach, it would allow the card issuer to identify who is responsible for the breach, and also allow the card issuer to recoup card replacement and fraud costs.
The league is also laying the groundwork for state charter modernization, which Abeel said will likely be a multi-session initiative. The league and state credit unions have yet to determine whether they will press for a complete rewriting of the state credit union act or changes on individual items.
Abeel said the league will take a defensive posture on foreclosure-related issues in two areas. One concern is legislation that would a require lender to provide maintenance to a foreclosed property. "While we want to be good corporate citizens," Abeel said. "We do not want lenders to be held to a different standard than homeowners are held to."
Two New Jersey municipalities--Orange and Newark--have also moved forward with plans to use eminent domain to buy properties that are in foreclosure. "That concerns us," Abeel said. "The towns can pay us less than is owed on the properties, and then turn around and give it back to the person that the lender foreclosed on."

Maine Senate president praises CUs for hunger assistance

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PORTLAND, Maine (2/7/14)--The president of the Maine State Senate praised credit unions this week for their efforts to mitigate the effects of childhood hunger.
Sen. Justin Alfond (D-8th District) said that state credit unions' initiatives are "very impressive and an important example of what the private sector can accomplish." Alfond made the comments at a meeting with charity leaders, educators and private sector organizations at Riverside Elementary School in Portland.
"I have been pleased to hear of the long-term commitment that Maine's credit unions have had to ending hunger, and I am really excited about the leadership that credit unions have put forth with their recent pledge to provide significant funding to support childhood hunger in Maine," he added.
Alfond also said that he is planning to meet with government agencies, food banks and private sector partners to discuss ways to combat childhood hunger, and has invited Maine's credit unions to participate.
The Maine Credit Unions' Campaign for Ending Hunger last fall committed a three-year $75,000 contribution toward expanding school backpack and pantry programs. The program, which was spearheaded by the Maine Credit Union League in 1990, has raised more than $4.8 million since its creation. In that time, Maine credit unions have raised almost $95 million toward hunger eradication, according to the MCUL.
Alfond pointed out that student hunger is a "major problem in Maine," and praised the backpack program for alleviating hunger over weekends and holidays. "It is not enough to provide meals during school. Hunger is seven days a week," he said.
More than four out of 10 children under the age of 12 in Maine show evidence of hunger, and 68,950 children are food insecure, according to MCUL. The league said that new data shows 15% of the state's households, containing some 200,000 people, are food insecure. The state is 13th in the nation and first in New England in food insecurity.
MCUL President John Murphy said that he appreciates Maine credit unions' participation and "the significant role credit unions have had in raising awareness and funds to end hunger in Maine for many years."