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CUs good press on fees picked up by IUSA TodayI Detroit paper

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DETROIT, Mich., and NEW YORK (5/17/11)--The good press credit unions have received for their role in helping consumers avoid fees--while banks make it harder to avoid them--was reported in Friday's Detroit Free Press and picked up by USA Today's website. The story, by Detroit Free Press business writer Katherine Yung, discussed the trend amongst banks such as Bank of America and Chase Bank to be creative in raising their fees on checking accounts. One Chase customer, Jennifer Amilivia, when hit with a $12 a month checking account fee because she needed a single monthly direct deposit of at least $500--pulled her account, noting she "shouldn't have to pay to use your bank," said the article. She joined Dearborn, Mich.-based DFCU Financial, where she isn't required to pay such fees. The situation, said the article is "likely to drive more consumers to community banks and nonprofit credit unions." It cited Michigan credit unions' growth as an example and quoted Michigan Credit Union League statistics on the growth of members. The state's credit unions gained more than 2,600 members in first quarter, in addition to the 96,000 new members gained the past two years. According to Michigan league President/CEO David Adams, the story in the Free Press drew hundreds of consumer comments, "predominantly, incredibly supportive of credit unions." The original article was facilitated by an earlier story that reacted to credit union membership growth in Michigan, prompted by the league's call report news release, he said. To view the article and the comments in either the Free Press or USA Today's website, use the links.

Police shoot CU robbery suspect during chase

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DES MOINES, Iowa (5/17/11)--A credit union robbery suspect accused of leading police on a car chase, carjacking a van, and ramming a police cruiser and other cars with the stolen van is in stable condition at a Des Moines, Iowa, medical center after he was shot by police Friday afternoon during the chase. Robin Terry Brooks, 27, faces charges of attempted murder, first-degree theft and second-degree robbery (The Des Moines Register (May 14). The incident began after noon when a man walked into Tradesmen Community CU, told a clerk he had a gun and demanded money. A credit union employee triggered a silent alarm. The robber fled in a white sedan. Police gave chase onto a nearby interstate highway and Brooks allegedly ditched the car and fled on foot. About a block away, he dragged a woman from her van and drove away. The woman was not injured, and police recovered a handgun at the scene of the carjacking. Witnesses and police said Brooks allegedly rammed a police cruiser and another car. Four police officers fired on the van and the injured Brooks was captured. Brooks did not fire his gun, said a police spokesperson. Officers involved in the shooting are on administrative leave pending an internal investigation--standard practice when police weapons are fired.

Two Sioux Falls CUs to merge

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SIOUX Falls, S.D. (5/17/11)--Two credit unions based in Sioux Falls, S.D., have announced they are merging to create a new credit union. The merger is between the $33 million asset Bell FCU, which serves 5,046 members, and the $28.8 million asset Midwest Partners FCU, with 4,704 members. Both serve Lincoln/Minnehaha Counties and have offices on the same cul de sac. Midwest Partners FCU's members voted May 11 in favor of the merger, with 94% of votes cast approving the proposal. "Unlike some mergers, ours was one of choice and not of financial need," said the credit union on its website. "Midwest Partners FCU and Bell FCU are both well capitalized and positioned for the future." The combined organization will assume a new name, and both boards of directors will combine into a seven-member board. Midwest Partners FCU President Jeff Schmidt will assume the role of chief operating officer. Bell FCU CEO Darla Erb will remain CEO of the merged credit union, according to a member letter on Midwest Partners FCU's website. The merger will provide more branches and more services, the credit unions said. Members will experience business as usual for the next several months until the transition is complete. Information about branch usage, the new credit union's name, and data processor conversions will be available later, the website said. With more than $60 million in combined assets, the newly combined credit union will be the fourth largest in the Lincoln/Minnehaha County area in asset size.

Seven more charged in St. Paul Croatian FCU collapse

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CLEVELAND, Ohio (5/17/11)--Seven more people were charged last week with fraud that led to a $170 million loss for--and the eventual collapse of--Eastlake, Ohio-based St. Paul Croatian FCU. The indictments bring the number of people charged for fraud related to the credit union's liquidation to 16. Arben Alia, 34, of Eastlake, was charged with 11 counts of bank fraud, one count of bank bribery and five of money laundering for allegedly obtaining $4.5 million in loans from the credit union with assistance from the credit union's chief operating officer at the time, Anthony Raguz (US Fed News May 13). Raguz, 51, of Mentor, Ohio, is one of nine people indicted in March and accused of bank fraud for their roles in the credit union's collapse (News Now March 4). Alia's loans allegedly were made from 2006 through 2009 and funded gambling excursions and renovations to a bar and grill. The indictment also charged Alia with giving about $100,000 to Raguz in exchange for approving and facilitating the fraudulent loans for Alia, his friends and relatives. Charged last week with assisting Alia were:
* Ilir Marku, 34, Willowick, Ohio, three counts bank fraud and two counts money laundering; * Vaso Shani, 36, Eastlake, one count of bank fraud and two counts of money laundering; * Alban Sulkaj, 35, Clinton Township, Mich., one count each of bank fraud and money laundering; * Zoge Ahmetaj, 68, Eastlake, one count bank fraud, two counts money laundering; and * Qerim Ahmetaj, 74, Eastlake, one count each of bank fraud and money laundering.
In a related case last week, a seventh person--Skender Demiri, 36, North Ridgeville, Ohio--was charged with one count of financial institution fraud, one count of bribery in connection with the business dealings of a financial institution and one count of money laundering. The indictment said that from June 24, 2004, through March 2, 2010, Demiri, aided by Raguz, obtained several loans totaling $1.6 million from the credit union by making false representations and saying the loans were to start a business. The credit union lost the full $1.6 million on the deals. Demiri was also charged with providing $50,000 in checks and cash to Raguz for approving and facilitating the loan approvals, and with three counts of money laundering, including a September 2009 wire transfer to a bank account in Germany. In addition to Raguz, others charged in March include: Koljo Nikolovski, 48, Eastlake; Rose Ann Nikolovski, 48, Eastlake; Marko Nikoli, 33, Eastlake; John Cendol Jr., 48, Kirtland; Ruth Cendol, 55 of Kirtland; Daniel Kocher, 72, of Euclid; Edward Watral, 37, Creston; and Jennifer Cerjan, 33, Orrville (News Now March 4). The credit union was placed into conservatorship by the National Credit Union Administration (NCUA) April 23, 2010 and shuttered May 1, 2010. At the time of its closing it held $238.8 million in funds from 5,400 members. NCUA's Office of the Inspector General reported last year that fraudulent loans pushed the credit union into liquidation.

Georgia CU Affiliates honors pro of the year

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DULUTH, Ga. (5/17/11)--Cassandra Brown of Credit Union of Atlanta has been named the Georgia Credit Union Affiliates’ Professional of the Year.
Cassandra Brown, assistant vice president of marketing and business development at Credit Union of Atlanta, was awarded the Professional of the Year Award at the Georgia Credit Union Affiliate’s (GCUA) annual meeting. From left, Mike Mercer, president/CEO, GCUA; Bill Cheney, president/CEO of the Credit Union National Association; and Brown. (Photo provided by Georgia Credit Union Affiliates).
Brown, assistant vice president of marketing and business development at the credit union, is the first African-American female to receive this honor from Georgia Credit Union Affiliates. The award is given to individuals who have made significant contributions to their credit union, chapter and the credit union industry in Georgia and the nation. It highlights individuals nominated by their peers as examples of the dedication and professionalism that help credit unions succeed. Brown began her credit union career more than 15 years ago working in the areas of regulation, operations, consulting and marketing. In her three years with Credit Union of Atlanta, Brown has led the organization through the process of redefining its field of membership. These efforts resulted in a 5% increase in membership. She also spearheaded the implementation of a rebranding campaign that included a name change, logo update and a new Web site. In 2009, she received the credit union development educator designation.

CU Direct elects officers recognizes CU achievements

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NEWPORT BEACH, Calif. (5/17/11)--CU Direct Corporation, a credit union service organization (CUSO) that provides lending solutions, last week announced the results of its board of directors elections and the winners of its 2011 Best Practices Awards. Joe Brancucci, president/CEO of GTE FCU, Tampa, Fla., was elected the new chairman of CU Direct. Two board members of CU Direct’s nine-member board were up for re-election. Both board members, Jeff March, president, Citadel FCU, Exton, Pa., and Barry Jolette, president/CEO, San Mateo (Calif.) CU, were re-elected to three-year terms. The board also elected board member John Lund, executive vice president, America First CU, Riverdale, Utah, as vice chairman of the board and March as the board’s secretary and treasurer. The CU Direct 2011 Best Practices Awards were presented last week during the CUSO’s inaugural Lending Redefined Conference . In the business development and dealer relations category, San Antonio CU, San Antonio and Hermantown (Minn.) FCU, were awarded the CU Direct Best Practice Award. In the marketing to members category, Point Breeze CU, Hunt Valley, Md. and Erie (Pa.) FCU were recognized. Vantage West CU, Tucson, Ariz. was recognized for collections. Service CU, Portsmouth, N.H. was honored in both the risk management and collections categories.

Volunteer Corporate W.Va. Corporate plan merger

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NASHVILLE, Tenn., and PARKERSBURG, W.Va. (5/17/11)--The boards of directors of Volunteer Corporate CU (VolCorp) and West Virginia Corporate FCU (WVCFCU) Monday announced their intent to enter into a merger agreement. The agreement calls for Nashville, Tenn.-based VolCorp to be the survivor, with the name and primary office location being maintained. Following regulatory and member approval, the corporates intend to merge operations for the benefit of the current members of both institutions. The plan also provides for a continued presence in West Virginia by maintaining operations and staff at WVCFCU’s current base in Parkersburg, W.Va. “After months of review of multiple proposals and due diligence, our board has determined that this decision to merge with VolCorp will provide the best future opportunity for our members and will bring excellent value,” said Tom Brewer, WVCFCU’s board chairman. "The combined institution will provide a greatly increased number of enhanced service offerings to the West Virginia credit unions,” he added. Hank Flury, VolCorp’s board chairman, said he believes the merger “will create synergies that result in a win-win for all members. Together, we will move forward, creating a stronger VolCorp to further meet the changing needs of our member credit unions.” Creation of a merger timeline is under way.

PCUA presents lifetime achievement awards

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HARRISBURG, Pa. (5/17/11)--The Pennsylvania Credit Union Association (PCUA) 2011 Annual Convention ended last week with a banquet honoring its lifetime achievement winners. Fran Muto, CEO of People First FCU, Allentown, received the 2011 William W. Pratt Professional of the Year Award. Muto recently announced his retirement from the credit union after 36 years (Life is a Highway May 16). Jim Stere, director of Wheatland FCU, Lancaster, was presented the 2011 Joseph A. Moore Volunteer of the Year Award. PCUA’s 2012 convention is scheduled for May 20-22 at the Wyndham Grand Pittsburgh Downtown.

N.J. league staves off bankers in publishing battle

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HIGHTSTOWN, N.J. (5/17/11)--The New Jersey Credit Union League has once again set the record straight in response to two letters to separate editors from the New Jersey Bankers Association. In letters to the Courier News (May 6), the Home News Tribune (May 9), and The Times of Trenton (May 13) New Jersey banks claimed that credit unions have “overstepped their mission” and should pay taxes because they “act like banks.” New Jersey Credit Union League President Paul Gentile responded with letters of his own explaining how credit unions:
* Are financial cooperatives with volunteer boards of directors; * Fulfill the basis of their tax exemption with better rates and lower fees than banks; * Have not cost taxpayers any money, unlike banks using Troubled Asset Relief Program funds during the financial crisis; and * Saw lending increase by 7.6% from December 2007 to September 2010 while it decreased by 6.5% at banks.
Gentile also noted credit union efforts to extend the business lending cap will help the U.S. economy and New Jersey credit union efforts to pursue legislation allowing them to accept municipal deposits--currently a monopoly held by state banks. “It’s important to respond to these baseless claims by bankers about credit unions expanding beyond their mission,” Gentile told News Now. “These claims about ‘mission” have been mispresented by bankers for years. We exist to serve our members with the best loan and saving products.” Gentile’s letters appeared in the May 16 editions of the Courier News and the Home News Tribune. Another letter was scheduled to appear in the Trenton Times today. This is the second round of attack on credit unions from New Jersey bankers in the last two months A March 6 article in the Bergen Record, titled "Credit union cutbacks," hinted that credit unions are slipping in satisfaction and some are starting to charge fees. Gentile defended credit unions' safety and soundness and reiterated customer/member satisfaction reports showing consumers are confident in doing business with credit unions in a letter that appeared in the the Bergen Record March 31. An editorial later in March by New Jersey Bankers President John McWeeney to njbiz.com claimed banks and credit unions don’t compete on equal footing. Gentile volleyed back with a letter to the editor published April 4 noting credit union structural differences, the lower rates they offer consumers, and their positive effect on the economy. New Jersey Credit Union League President Paul Gentile wrote an editorial in the April 4 edition of njbiz.com in response to an editorial by New Jersey Bankers President John McWeeney.

Maurice Smith named CU Hero of the Year

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MADISON, Wis. (5/17/11)--Maurice Smith, president/CEO of Local Government FCU, Raleigh, N.C., has been voted Credit Union Magazine’s Credit Union Hero of the Year. Smith is helping his members confront a difficult economy by providing alternatives to subprime debt, mortgage loan modifications and unemployment protection options. Much of North Carolina is rural. Often local banks aren’t interested in making small loans to the inhabitants. And that reluctance extends to small loans for critically needed equipment, such as fire trucks, Smith told Credit Union Magazine. While the credit union serves the employees of local government units, it formed a credit union service organization (CUSO), LGFCU Financial Partners, in 2006, to meet the needs of the state’s local municipalities. “In North Carolina, local government units can only deposit funds in banks, savings and loans, and trust companies because of state investment laws for units,” Smith told the publication. “The CUSO was a perfect match for us. It made sense for us to provide services to the towns. They came to us.” LGFCU Financial Partners is a wholly owned subsidiary with separate governance from the credit union’s board, to provide limited liability. About 76% of its lending is to fire departments, 22% to emergency medical services, and 2% to city/county units. In the four years since it launched, 139 borrowers from 53 counties have borrowed roughly $38 million. The CUSO has had no losses. Smith will be honored at the Credit Union National Association’s America’s Credit Union Conference & Expo in San Antonio, June 19-22. Credit Union Magazine also honored three other credit union leaders this year:
* Ron Amstutz, executive vice president, Desert Schools CU, Phoenix. He faced a personal challenge when his son was diagnosed with Guillain-Barre Syndrome. His son recovered and Amstutz paid it forward; helping Desert Schools become the No. 1 U.S. credit union for Children’s Miracle Network Hospitals fund raising. * Michael Bittle, CEO, Vanderbilt University Employees’ CU, Nashville, Tenn. When his neighbors and members sustained damage from the May 2010 Nashville floods, he created a suite of flood-relief loan products to help victims through the ordeal. * Carol Schillios, founder of Schillios Consulting Group, Seattle. A microfinance entrepreneur, she has helped establish cooperative programs in countries worldwide. Her peers refer to her as “Ms. Credit Union.”

Freiberg to keynote at N.Y. convention

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ALBANY, N.Y. (5/17/11)--Kevin Freiberg, recently named one of the “Top 30 Best Minds on Leadership” by Leadership Excellence Magazine, will present the closing keynote speech at the Credit Union Association of New York’s Annual Meeting & Convention, June 5 in Lake Placid, N.Y. Freiberg is the author of Nuts! Southwest Airlines’ Crazy Recipe for Business and Personal Success. He has also co-authored Boom!: 7 Choices for Blowing the Doors Off Business-As-Usual; Guts!: Companies that Blow the Doors off Business-as-usual; and the forthcoming Nanovation: How a Little Car Can Teach the World to Think Big. Freiberg is the president of San Diego Consulting Group, Inc., a professional speaking and consulting firm dedicated to equipping leaders for a world of change. In his keynote, Freiberg will share with credit union leaders his views on the links among leadership, corporate culture, innovation and exceptional customer loyalty; how those links have played out in companies such as Southwest Airlines and Motorola; and how to translate those strategies into success. The Credit Union Association of New York’s 2011 Annual Business Meeting & Convention will also feature an expo with more than 60 industry vendors, and education sessions led by industry experts. Attendees can choose from 14 sessions during the three-day event, with topics ranging from compliance, to risk management, to growth strategies. For under-30-year-old attendees, there will be a reverse panel with the “Crashers” led by members of the association’s Young Professionals Commission.

CU System briefs (05/16/2011)

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* SPRING VALLEY, N.Y. (5/17/11)--Cynthia Vaughan, 54, CEO of Rockland Employees FCU, Spring Valley, N.Y., pleaded guilty Thursday to bank fraud in the embezzlement of $150,000 from the credit union. She faces up to 30 years in prison and a maximum fine of $1 million or twice the gross gain or loss from the fraud (The Journal News May 14). According to the U.S. Attorney's Office, Vaughan accessed the credit union's computer system to transfer funds from its operating accounts into her personal accounts. The embezzlement occurred from October 2000 to July 2006 … * BATON ROUGE, La. (5/17/11)--Linda S. Dunn, 59, of Zachary, La., a former loan officer and assistant manager at East Baton Rouge (La.) Teachers FCU, was sentenced Thursday to eight years in federal prison for fraud and money laundering that cost the credit union $150,833. Chief U.S. District Judge Ralph E. Tyson also ordered Dunn to pay full restitution to the credit union and its insurer (The Advocate May 13) … * MANSFIELD, Texas(5/17/11)--Texas Trust CU has selected James Minge as the Mansfield, Texas-based, $700 million asset credit union's new president/CEO, effective May 31, announced board chairman Larry Skinner. Minge succeeds retiring CEO Jim Gray, who provided executive leadership to Texas Trust CU for the past 20 years. Minge, a certified public accountant, previously was senior vice president/chief project officer at the $4 billion asset Randolph Brooks FCU, Live Oak, Texas. His position there included being responsible for leading a core system conversion for more than 325,000 members. He also served as senior vice president of operations, responsible for the performance of 37 branch locations, at Randolph Brooks FCU … * NEW CASTLE, Del. (5/17/11)--J. Michael Dunlap of Wilmington, Del., died May 7 at the age of 57 of heart complications (The News Journal via Legacy.com May 10). Dunlap was a credit union volunteer for more than 30 years, including serving on the boards of the New Castle, Dela.-based Delaware Alliance FCU and the former WILDUPCO FCU, said the Delaware Credit Union League (Together May 16). He currently was the financial officer for Delaware Alliance FCU. Dunlap also previously served on the league board, said the league …