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CU System Briefs (03/22/2013)

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  • BROOKSVILLE, Fla. (3/22/13)--Jennifer Hoefler, 41, of Floral City, Fla., has been charged with organized fraud related to the theft of more than $49,125 from member accounts while she was branch manager at the Brooksville branch of Tampa-based Suncoast Schools FCU. She had been employed by the credit union since 1993. The thefts occurred between Sept. 25, 2012 and Feb. 13 in transactions from $100 to $5,000. The thefts allegedly supported a prescription drug habit, said the Hernando County Sheriff's Office(Tampa Bay Times March 20) …
  • EL PASO, Texas (3/22/13)--El Paso-based evolve FCU has formed a young adult team to increase its visibility in the community (LoneStar Leaguer March 20). The evolve project team for 2013 includes (pictured) Antonio Marquez, a film student at New Mexico State University; Christopher Valverde, a journalism graduate  of the University of Arizona and marketing assistant for Valor Hispano Magazine, and Ashley Ann Hernandez, a senior at Bel Air High School.  They will provide monthly "Man on the Street" videos educating the public about the differences between credit unions and banks, and will assist with evolve FCU's social media efforts. (Photo provided by the Texas Credit Union League) …
  • BURNSVILLE, Minn. (3/22/13)--For the 10th year, US FCU, Burnsville, Minn., has partnered with AccountAbility Minnesota (AAM) to provide free tax filing assistance for low-income qualified residents in the Twin Cities metro area through the Volunteer Income Tax Assistance (VITA) program. In 2012, USFCU employee volunteers processed 146 returns resulting in $209,009 in refunds. So far in 2013, volunteers have helped complete more than 100 returns. Volunteers also understand many of the specialized tax credits such as the Earned Income Tax Credit, Child Tax Credit, and Credit for the Elderly or the Disabled. This helps ensure individuals are taking advantage of all credits available to them, said the credit union …

NY Advances Bill To Protect CUs From Nuisance ATM Lawsuits

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ALBANY, N.Y. (3/22/13)--A Credit Union Association of New York-backed bill that would protect New York's credit unions from nuisance ATM disclosure lawsuits has been introduced in the State Assembly.

CUANY announced Thursday that "important legislation that CUANY has been fighting for has been introduced in the New York State Assembly by the chair of the Banks Committee, Assemblywoman Annette Robinson."

The bill (A.6234) addresses an issue that has created legal and financial issues for many credit unions--ATM fee disclosure regulations-- by eliminating the requirement for physical fee disclosures to be placed on ATMs.

Current state law requires ATM operators to display notices in two locations, both physically on the ATM and on the electronic notification on the screen, informing consumers they might be charged fees for withdrawing cash from the ATM.

In some cases, vandals have removed the physical disclosure and then sued the financial institutions for noncompliance. To protect themselves from lawsuits, credit unions have had to spend time and money documenting their compliance and fighting frivolous lawsuits, said CUANY.

Assemblywoman Robinson's bill would eliminate the requirement of physical fee disclosures on ATMs, which would bring New York State law into conformity with federal law signed by President Obama last December.

The Credit Union National Association strongly backed the federal law, with CUNA President/CEO Bill Cheney noting that the law represented a "substantial realization of regulatory relief that will have an impact on every credit union that owns an ATM" while having no adverse effect on consumers (News Now Dec. 12)

CUANY President/CEO William J. Mellin noted that CUANY has been advocating aggressively for state passage of this legislation.

"Our state's law on this issue needs to be modernized, and the introduction of this bill is a significant step in the right direction. We commend Assemblywoman Robinson for her leadership, and we will continue to advocate for advancement of the bill in both the Assembly and the Senate," Mellin said.

Last month a similar bill to eliminate the requirement for a physical disclosure on ATMs about fees passed the Nebraska State Legislature, 47-0.  That will was supported by credit unions and the Nebraska Credit Union League (News Now Feb. 12).

Nebraska, New York, Illinois, Nevada, Vermont and Wyoming are the only states that require dual disclosures.

Ohio CUs On Sales Tax Watch

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COLUMBUS, Ohio (3/22/13)--The Ohio Credit Union League is among the groups voicing concerns over impacts from the proposed state sales tax provision in the state's budget proposal. The provision is seeing activity in the state legislature.

The league "continues to aggressively monitor legislative activity" on the provision included in the governor's proposed budget, it said (eLumination Newsletter March 20).

"Led by the State Budget Impact Work Group, the league is better grasping the true impact of an expanded sales tax base, which would include taxes on services utilized and offered by credit unions," the league said.

Last week the league sent two letters to key legislators, sharing credit unions' concerns and highlighting how the proposed changes could hamper credit unions' ability to serve their members and impact the state-charter system.

The league is one of many trade groups voicing opposition, it said.  Roughly 75 interested parties testified in budget related committees last week, with the majority strongly opposing the sales tax proposal, the league said. During the first week of March more than 50 witnesses testified on the proposal.

Gov. John Kasich's biennium budget would expand the products and services subject to sales tax and lower the overall rate to 5% from 5.5%. The State Budget Impact Work Group consists of 16 Ohio credit union leaders and league staff who are researching the bottom-line impact on credit unions.

16 CUs On 'Cool Vehicles' List

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MADISON, Wis. (3/22/13)--What do a Zamboni, a Volkswagen bug, a VW bus, a Honda Cube, a Smart Car, a Hummer, and a day-glow minivan have in common? They all have been dubbed "cool" as promotional vehicles for credit unions and banks.

Click to view larger image CommunityAmerica CU based in Kansas City, Mo., has two vehicles featured on the "25 Coolest Vehicles" list, including the "Getaway Car."  (Photo provided by CommunityAmerica CU).
The website of The Financial Brand, which offers marketing insight to credit unions and banks, noted while most financial institutions have a vehicle fleet with a sticker or two, some institutions took their vehicles to a new level. It listed, with photos,  25 of the "coolest vehicle designs" from financial institutions. Vehicles from 16 credit unions are on the list, including the Zamboni from Fort Wayne, Ind.-based MidWest America FCU.

Other vehicles from credit unions highlighted were:

  • Lathrup Village, Mich.-based Michigan First CU's "Young & Free" Ride;
  • Kansas City-based CommunityAmerica's "Getaway Car," which urges consumers to "unbank yourself" and "liberate your money,"  and its "Escape Mobile," which says "remove the bank cuffs" and "go bankless."
  • Bridgeton, Mo.-based Vantage CU's  turquoise wrapped Honda Cube touting Young & Free;
  • Ridgecrest, Calif.'s AltaOne CU  banana colored  "Good Deeds Mystery Wagon";
  • Idaho Central CU's green-flamed van in Pocatello, Idaho;
  • Knoxville, Tenn.-based UT FCU's "Orange & White: Volkswagen bug;
  • Cheyenne, Wyo.'s Warren FCU  "It's Not a Bank" auto;
  • Brockton, Mass.-based HarborOne CU's  Smart Car;
  • Bristol, Pa.-based Bucks First CU's "Project Flipside vehicle;
  • Edwardsville, Ill.-based Scott CU's "Big Barkers Kidz Club" Hummers;
  • Global CU's vehicle in Spokane,Wash.;
  • Five Star CU's "Patriotic SUV" in Dothan, Ala.;
  • Illawarra CU (in Australia)'s "Red Camouflage";
  • Jax FCU's "Blue Scion" in Jacksonville, Fla.; and
  • Seasons FCU's "Do You Kasasa" vehicle in Middletown, Conn.
To view all the the colorful vehicles, use the link.  The Financial Brand offers marketing insights for credit unions and banks.

CU's Get Naked Campaign Touts Free Checking

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WICHITA, Kan. (3/22/13)--Wichita, Kan.-based Central Star CU's has bared the essentials of its latest ad campaign for its free checking service, Naked Checking. It urges members to Get Naked Checking, and its tagline is: "It's free, so there's nothing to hide."

Click to view larger image Click for larger view
The campaign notes the $75 million asset credit union's free checking has no service charge, no hidden fees, free debit card with cash-back incentives and no annual fee, free e-statements, unlimited check writing, and free online banking and bill pay.

The campaign features a hairless cats and dogs in YouTube videos, print ads and billboard ads. 

To watch the "Feel Good Naked--Get Naked Checking" and "Nothing Wrong With Naked--Get Naked Checking" videos, use the YouTube links.

In the first, a man walking his "naked" dog gets a series of  jaw-dropping and second-takes from bystanders as they pass by. A second video features the man in a bathrobe searching empty drawers, shelves and closets for clothes while the dog looks on. Finally the man goes outside and finds a trail of clothes to the dog house.

The campaign also asks members to "Get Naked & Give Back," by raising funds for the Kansas Humane Society. Members can donate items on the society's wish list. For every item donated, Central Star will give $1 to the Humane Society, up to $2,000.

ATM Group Publishes Best Practices To Prevent Mobile Fraud

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SIOUX FALLS, S.D. (3/22/13)--The ATM Industry Association has published a new best practices manual for preventing mobile banking fraud, with special reference to applications linked to ATMs.

Due to the increasing popularity of mobile phones--in particular smartphones and tablet computers that offer Internet access--mobile banking and related mobile commerce has become an important channel for the financial services industry, including the ATM industry, ATMIA said.

Mobile device interactions with an ATM can include:

  • Cashing out transactions initiated on a mobile device;
  • Alerting consumers to transactions performed at an ATM;
  • Receiving an electronic receipt for a transaction performed at an ATM; and
  • Providing a one-time password to authorize an ATM transaction by replacing the traditional card and personal identification number used to perform an ATM transaction.
"In a time when the ATM can be used to complete transactions begun on a mobile phone, and as cardless ATM transactions gradually replace ones initiated by plastic cards, it is important to check out any security vulnerabilities associated with mobile phone banking applications," explained Mike Lee, ATMIA CEO.

The manual also is designed increase understanding of the relationship between the mobile and ATM channels.

"Downloadable apps for smartphones and some tablet computers are creating new, more sophisticated interactions between the mobile device and the consumer's bank accounts, so we fully expect mobile banking to grow significantly," Lee said.

CU Consolidation Continues With M&As

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MADISON, Wis. (3/22/13)--Continuing a trend of consolidation in the credit union industry, several credit union mergers and acquisitions have been announced or completed across the nation in March.

Northwest Community CU in Springfield, Ore., with $766 million in assets, announced the completion of its merger with Coos Educators CU in Coos Bay, Ore., with 14 million in assets.

Coos Educators' lone branch began operating March 16 as Northwest Community CU. For smaller struggling credit unions, a merger can fulfill commitments to loyal members and improve access to financial services, Northwest Community said in release.

"We chose to pursue a potential merger with Northwest community CU as a way to strengthen our organization during a challenging economy, and ensure continued service of excellence for our members," said former Coos Educators FCU Board Chair Chuck Inman. "We chose Northwest Community CU because of its long history of caring about the local communities they serve, and their successful track record as a stable organization."

Other recent mergers and acquisitions include:

  • Houston-based InvesTex CU, with $117 million in assets, plans to purchase a Houston branch of Star Trust FCU's (formerly Enron FCU, which once serviced the now-defunct Enron Corp.) StarTrust has $51.6 million in assets. The acquisition is subject to regulatory and member approval.
  • The $1.89 billion asset Summit CU, based in Madison, Wis., said it is acquiring Milwaukee-based Veteran's Administration CU (VACU), with $14.8 million in assets (Milwaukee Business Journal Online March 19).  The acquisition is slated for completion in September and is contingent on approval of regulators and VACU membership.
  • Kinecta FCU in Manhattan Beach, Calif., with $3.17 billion in assets, Wednesday absorbed Inglewood, Calif.-based I.C.E. FCU, which was liquidated March 15 by the National Credit Union Administration. NCUA determined I.C.E. was insolvent and had no prospects of restoring viable operations (CUinsight.com March 20).
  • Plymouth, Minn.-based TruStone Financial FCU (formerly Teacher FCU), with $861 million in assets, announced an agreement March 1 to merge with  Ladish Community CU (formerly Ladish  Employees CU)  in Cudahy, Wis., with $13.4 million in assets. Starting April 1, the combined entity will operate as TruStone Financial FCU (Marketline March 4 and PlymouthPatch March 6).
  • A merger of $32.7 million asset U.S. Coast Guard Community CU in Baltimore into Tower FCU, based in Laurel, Md., with $2.52 billion in assets, was approved by Coast Guard Community members at the end of last month (Washington Business Journal Online March 5). The proposed merger is scheduled to be finalized by June 30, pending regulatory approval (SNL.com March 2). 

MSUFCU Awards $25K To Biz Model Contest Winner

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EAST LANSING, Mich. (3/22/13)--Michigan State University FCU (MSUFCU) in East Lansing, Mich., awarded $25,000 to Kymeria Advance Materials, the grand prize winner in its business model contest.

Click to view larger image Michigan State University FCU in East Lansing, Mich., awarded $50,000 in prizes to start-up business ventures--including $25,000 to Kymeria Advanced Materials, the grand prize winner in its business model contest. (Photo provided by Michigan State University FCU)
The 2013 Greenlight Business Model Competition, created by Spartan Innovation and the $2.34 billion asset MSUFCU, allowed entrepreneurs statewide to pitch their business ideas. There was more than $50,000 in available prizes, sponsored by MSUFCU.

MSUFCU sponsored the Greenlight Competition this year and the program "will bring new businesses to Michigan to help improve our economic conditions statewide," said panel judge April Clobes, MSUFCU executive vice president and chief operating officer.

During the first round of the competition, participants were asked to complete an application and business plan. Then 25 finalists pitched their business ideas in front of seven judges. Prizes were awarded based on best pitch, fastest growth potential, best idea for Michigan, most creative, and most needed in the marketplace. Three endowments were designated for undergraduate students.

Kymeria Advanced Materials was created by Cameron Smith, Vincent Alessi, Dave Hatfield and Reed Shick. The start-up is developing new chemistry for ceramics, which brings the benefits of existing advanced ceramics to new parts and markets.