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CU System Archive

CU System

Big Game Hunter contest winners on website

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MADISON, Wis. (3/21/08)--The Credit Union National Association has announced the winners of its Big Game Hunter Photo/Video Contest. The contest theme was "Show Us Your Big Game Hunter Strategy to Capture Your Prey." Winners are:
* First place ($500): Velocity CU, Austin, Texas, for "Mythbusters Episode 114--'Credit Unions Aren't Sexy,'" submitted by Carol Cain. * Second place ($250): Denver Community CU, Denver, Colo., "Fishing fr' Credit Unions With Bubba," submitted by Brad Blue. * Third place ($100): Transportation CU, Washington, D.C., "From Diapers to Depends--lifetime membership, submitted by Sylvia Galo.
Winner of $50 in a random drawing among credit unions who voted was Regina Lynch of 360 FCU, Windsor Locks, Conn. Big Game Hunter is a CUNA marketing initiative aimed at membership growth by using tools appropriate for different life stages. For more information, or to view the winners' entries, use the link.

Best Practices winners honored at council conference

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MADISON, Wis. (3/21/08)--Winners of the 2008 Best Practices Awards, sponsored by the CUNA Marketing and Business Development Council, were announced during the council’s 15th annual conference, Sunday through Wednesday, in Nashville, Tenn. Awards were presented in three categories:
* Business Development: Financial Partners CU, Downey, Calif., for its member contact strategy, which uses member activity triggers to create cross sales and prevent member attrition. The credit union launched the program, which sends out mailings to members who notify the credit union of address changes, closed accounts or new account openings, in August 2007; * Community Outreach and Political Advocacy: America’s Christian CU, Glendora, Calif., for its “snow much fun” event. The credit union gave its community snow, and treated attendees to a petting zoo, Santa and refreshments. About 1,500 attended the event. The credit union raised $770,000 in term share certificates through its snow day savings promotion; and * Best Practice Miscellaneous: Call FCU, Richmond, Va., for its rebranding plan. The credit union created a Be the Office Hero campaign, which used marketing tactics to recruit select employee group members. Staffers dressed as super heroes and looked through the city for the next office hero to bring credit union membership growth to an employer. The campaign’s efforts carried over into the rebrand when the credit union created its new mascot, iDude. The brand was included in advertising, community events, branch redesigns and the website. The credit union had a 30% increase in Web traffic, increases in vehicle loans and loan volume, and new member increases that doubled previous averages.
The conference also raised $9,500 in a silent auction for the National Credit Union Foundation’s Disaster Relief Fund. For more information, use the links.

Bill limiting CUs growth passes Kansas Senate

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TOPEKA, Kan. (3/21/08)--The Kansas Senate Wednesday approved a bill that would limit state-chartered credit unions' field of membership by a vote of 35 to 2. The bill, Substitute for SB 535, would limit the geographic area served by credit unions and create new regulatory standards for branching, mergers and field-of-membership changes. "We'll have credit unions that will not be able to expand in a way they could have before," said Marla Marsh, Kansas Credit Union Association president/CEO. Credit unions immediately affected by the legislation include:
* Boeing Wichita CU, Wichita; * Credit Union 1 of Kansas, Topeka; * Credit Unions United, Topeka; * Education CU, Topeka; * Golden Plains CU, Garden City; * Hutchinson CU, Hutchinson; * Kansas Super Chief CU, Topeka; * Medical Community CU, Wichita; and * Mid-American CU, Wichita.
The bill has been extensively amended and approved by the Senate Financial Institutions and Insurance Committee to reflect language agreed upon by the Kansas Credit Union Association. It was introduced by the Kansas Bankers Association. The association does not support or oppose the legislation, but said it will provide a long-term standard for interpreting the Kansas field-of-membership statute.

Is data breach insurance in the future

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MADISON, Wis. (3/21/08)--With the massive data breaches experienced in the U.S. the past year, service providers offering data breach insurance are making the rounds. But is data breach insurance right for a credit union? "Data breach insurance is more directed to the merchant" than the financial institution issuing the credit or debit card, said Chuck Cashman, director of product management with the Credit Union Protection division at CUNA Mutual Group. A merchant who is not Payment Card Industry (PCI)-compliant has a stronger case for getting that kind of insurance policy to cover fines and litigation. But if a merchant isn't PCI-compliant and has a data breach, the insurer can require the merchant to become PCI-compliant before reinsuring the merchant, Cashman told News Now. Data breach insurance would help a merchant who is PCI-complaint but still a victim of a breach--such as in the Hannaford Bros. breach that was announced this week, said Cashman. "Hannaford was PCI-compliant," he said. In that case, the insurance "might help stave off potential costs of the breach." Credit unions are covered against data breaches under CUNA Mutual's plastic cards policies, Cashman said. The policies differ according to what each credit union needs. "They are not a cookie-cutter service. A credit union can insure for losses in a range from the ground up to catastrophic losses," he said. When members' accounts are compromised in a data breach, there are hard costs and soft costs, he said. "There's the hard money of reissuing the plastic," he said. For example, at $15 per card, which is in the lower range of estimates for replacing cards, a credit union replacing 5,000 cards would spend a minimum of $75,000. "There's also the soft dollars related to making phone calls and reaching out to members," Cashman added. "Credit unions typically don't have the back-office infrastructure to do all that." Credit unions approached about breach insurance should contact their current provider, who can help them through the process so the credit union is making an apples-to-apples comparison of policy provisions. Because each policy has unique provisions to fit the individual credit union's need, it often takes a rigorous review to understand each provision in the policy, Cashman said.

CU System briefs (03/20/2008)

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* MONTGOMERY, Ala. (3/21/08)--U.S. Rep. Mike Rogers (R-Ala.), right, visits with a member of MAX, Your Community CU Tuesday. MAX CEO Greg McClellan invited Rogers to stop by the credit union's Eastdale financial center to meet members and associates, and learn more about MAX's involvement with the community and the credit union difference. MAX has a strong commitment to serving individuals and communities that are often underserved by the bbanking industry. As of Feb. 29, more than 52% of MAX's households in the underserved areas of Autauga, Elmore and Montgomery counties had at least one type of personal checking account, and 22% had at least one type of loan with MAX. The credit union has a 45% penetration rate of all underserved households in the tri-county area. (Photo provided by MAX, Your Community CU) … * CHICAGO (3/21/08)--Three credit unions are among 41 companies from 18 states chosen for the 2008 Honor Roll of Companies That Care by the Center for Companies That Care. The Chicago-based nonprofit is dedicated to enhancing the well-being of employees and communities by encouraging employers to integrate 10 characteristics into their daily business practices. Named to the honor roll were: Baxter CU, $1.3 billion in assets, based in Vernon Hills, Ill.; Mountain America CU, $2.3 billion assets, West Jordan, Utah; and The Golden 1 CU, $6.5 billion assets, Sacramento, Calif. Recipients undergo a review by an independent panel of business professionals. A media search and a review of employee survey data round out the selection process …

Filene Institute provides link to free reports

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MADISON, Wis. (3/21/08)--The Filene Research Institute has created a web page with a “guest pass” that provides all credit union executive boards access to free research and information about credit unions. The 24/7 page was created after several Filene members donated money this year to enhance Filene’s efforts to disseminate information to credit unions. “The financial services industry is clouded with competition, commoditization, and consumer inertia,” Filene says on its website. “Securing the future of credit unions as a relevant and viable choice for all consumers is a top Filene research and innovation priority.” For more information, use the link.

DFCU members waiting for hearing before proceeding

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DEARBORN, Mich. (3/21/08)--A group of members of DFCU Financial FCU (DFCU) are waiting to see what happens at the next hearing before proceeding after winning a lawsuit against the credit union. Leslie Herrick, public relations consultant on behalf of the members, told News Now that she could not comment further until she heard from members. A court hearing regarding the inspection of books and records at the credit union has been rescheduled for April 17 at 2:30 p.m. The meeting will establish the timeline for the records inspection. A Wayne County Circuit Court judge also ruled that the members have a right to call a special membership meeting. The meeting was requested by members to vote on the removal of directors from the DFCU board. Three DFCU members filed the lawsuit in the spring of 2006 during DFCU’s campaign to convince members to vote in favor of converting to a mutual savings bank. Although the vote was cancelled, members questioned the credit union board of directors’ due diligence and motives for proposing a charter change. The members sued after the credit union refused to let members review complete board meeting minutes and other materials considered by the board during the attempted conversion. The credit union later withdrew the conversion proposal and a board election was conducted. Eight of the nine directors named in the recall petition have either resigned or have been re-elected. The credit union expressed disappointment at the court decision and sat it will evaluate its options including appealing.

Two class action suits filed in Hannaford breach

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PORTLAND, Maine (3/21/08)--Two class action lawsuits have been filed against Hannaford Bros., a Maine-based grocery chain whose system was hacked in a data breach that might affect as many as 4.2 million credit and debit cards, many of them with members of credit unions. According to several reports, a Philadelphia law firm, Berger & Montague, filed suit Wednesday in U.S. District Court in Portland. The suit alleges the company was negligent and breached an implied contract in failing to provide adequate security for computer data (Associated Press via Boston Globe, Computerworld March 20). It seeks to recover damages that might be caused to consumers as a result of the breach. A second lawsuit, with similar allegations, was filed in the U.S. District Court in Bangor, Maine, by attorney Samuel Laham Jr. on behalf of Hannaford customers in all the states doing business with the grocer. That suit names Melinda Ryan as lead plaintiff. Hannaford said it has not been served with any court complaints (Computerworld,(mysuncoast.com and SouthCoastToday March 20). Hannaford has 165 stores in New England states plus 106 Sweetbay stores in Florida (News Now March 18, 19 and 20). Several credit unions in New England are already re-issuing cards to members whose accounts may have been compromised and some members have reported fraudulent activity on their accounts. Computerworld noted that credit unions and banks "are getting increasingly antsy about having to shell out tens of thousands of dollars" to pay the costs of notifying their members and customers. It reported on the Maine Credit Union League's warning that the Hannaford breach likely would have a significantly larger impact on the state's credit unions than the TJX Cos. breach (News Now March 19). It also several credit union associations around the U.S. have been pressuring state lawmakers to pass laws requiring retailers hit by data breaches to bear the costs associated with the breaches.

CNN offers inflation fighter Join a CU

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NEW YORK (3/21/08)--CNNMoney.com advises those looking to avoid the effects of inflation to join a credit union. “Beat inflation at home,” an article published yesterday, noted how the tough economy has contributed to the rise of banking fees--from overdraft fees to ATM surcharges. The article advised readers to join a credit union because they “generally have lower fees” than traditional financial institutions (CNNMoney.com March 20). The article also advised consumers to link their checking and savings accounts, pay bills online, and contact credit card companies to try and waive late fees. Other major media outlets, such as the Washington Post and Dow Jones News Service have also advised consumers to join credit unions. Dow Jones and the Post noted that credit unions tend to offer better loan rates than banks (News Now Dec. 27.). For more information, use the link.