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CU System Briefs (08/01/2013)

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  • VACAVILLE, Calif. (8/1/31)--A federal judge Friday ordered a trial for a Fairfield, Calif., man charged with felony vandalism for allegedly damaging an ATM and breaking a window with concrete chunks at Travis CU on Feb. 13 (TheReporter.com July 31). A security officer for Travis CU, Vacaville, Calif., testified that after receiving a report of vandalism at the branch he found chunks of concrete near a damaged ATM and a broken window with more concrete chunks nearby. The ATM machine's video surveillance system showed a man wearing what looked like a white robe and a jersey with the number 1 on it strike the ATM machine before moving toward the credit union's glass window. Police later located David G. Loflin about two blocks away, wearing the same jersey ...
  • ST. LOUIS (8/1/13)--An Arnold, Mo. man was charged Saturday with one count of robbery in the second degree and one count of possession of a controlled substance in connection with the June 24 robbery of First Missouri CU, St. Louis. Edward W. Starns, 30, was arrested Friday after a tip led police to an area hotel (ArnoldPatch.com July 29). He is being held in the St. Louis County Justice Center in lieu of a $100,000, cash bond. St. Louis County police released photos from video surveillance of a man believed to have fled the credit union in a small to mid-size yellow Chevrolet. No weapons were displayed in the robbery. Police confiscated a substance they believed to be heroin during the arrest ...

NEW: N.Y.'s Gov. Cuomo Signs ATM Disclosure Bill

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ALBANY, N.Y. (8/1/13, UPDATED 3 p.m. ET)--New York Gov. Andrew Cuomo today signed credit union-supported legislation that eliminates the requirement of physical fee disclosures on ATMs and brings state law into conformity with the federal law signed last December by President Barack Obama.
 
The Credit Union Association of New York said it has been advocating aggressively for this legislation, citing burdensome ATM fee disclosure regulations that created legal and financial issues for many credit unions.
 
The Assembly bill was introduced by Assemblywoman Annette Robinson (D-Metropolitan), and Sen. Joseph Griffo (R-Utica-Rome/Central) introduced the Senate bill.
 
"We commend Gov. Cuomo, Assemblywoman Robinson and Sen. Griffo for their outstanding leadership and support on this important issue," said CUANY President/CEO William J. Mellin. He acknowledged "the grassroots efforts of many credit union leaders, which played an important role in this legislative victory."
 
Credit unions and other financial institutions across the nation had experienced nuisance lawsuits from people who would remove the notices from the ATMs, then claim disclosure violations. The Credit Union National Association and state leagues advocated strongly for an amendment to the Electronic Funds Transfer Act, and the Consumer Financial Protection Bureau in March implemented a rule to eliminate redundant ATM disclosures.

CU Member Loyalty Rises At Banks' Expense

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MADISON, Wis. (8/1/13)--Members' loyalty to credit unions has risen sharply in recent years at banks' expense, according to the Credit Union National Association's 2013-2014 National Member and Nonmember Survey Results.
 
The August edition of Credit Union Magazine provides an in-depth look at the survey findings.
 
Nearly 60% of members now say a credit union is their primary financial institution (PFI), up considerably from 42% in 2009. Meanwhile, banks' numbers declined from 56% in 2009 to 38% this year.
 
"The financial crisis of 2008 and 2009 caused many consumers to question their loyalty to banks, which many consumers blamed for triggering the economic collapse," said Jon Haller, CUNA's director of corporate and market research.
 
Since that time, many consumers have embraced credit unions' not-for-profit, cooperative business model. The financial crisis spurred many members to shift their primary loyalties from banks to credit unions.
 
Loyalty has become the Holy Grail of marketing because highly loyal members use more credit union products and services than other members, and are the cooperatives' most passionate advocates.
 
Credit unions prevail in another key measure of loyalty: active referrals. Overall, 57% of members say they're "extremely likely" to recommend their credit union to others, while only 40% of members who also use banks say they're "extremely likely" to recommend their banks.
 
Also, an overwhelming majority of credit union members (84%) say they "definitely" or "probably" will contact their credit union the next time they need financial products or services.
 
At the same time, credit unions have a considerable opportunity to develop deeper business relationships with their members, as 85% also have accounts with banks while only 15% don't use banks.
 
Members are just as likely to use credit unions as they are banks for checking and online banking, the survey results indicate.
 
On the upside, 59% of members now use credit union checking accounts, up from 51% in 2009.
 
"This represents important wallet share growth opportunities for credit unions," Haller said, "because the checking account is an important product that determines PFI status. As your members' PFI, there's a strong likelihood they'll give you the first shot at meeting their product needs."
 
In addition to increasing checking account penetration, credit unions also made gains with online banking penetration. CUNA's research shows that 50% of members use their credit unions' online banking services, up from 32% in 2009.
 
However, 49% of members also use banks' online banking services.
 
Another article from CUNA's surveys, CUs Must Improve Awareness Among Nonmembers, will be in Monday's News Now.  For more information, attend the Grow Your Membership webinar on Sept. 18 or use the links.

More CUs Share the Message: 'Don't Tax My CU'

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MADISON, Wis. (8/1/13)--

Click to view larger image San Antonio Citizens FCU in San Antonio, Fla., made its position clear--"Don't Tax My Credit Union"--in this advertorial in the Tampa Bay Times. Pictured are staff members with CEO Tim Baldwin, bottom left. "You would think that if there were this huge advantage [from credit unions' tax status]' that some bank somewhere would want to change charters and take advantage of it," he said. (Photo provided by San Antonio Citizens FCU)

Taxation of credit unions is a bad idea because it takes money out of the pockets of millions of credit union members, said San Antonio (Fla.) Citizens FCU in an advertorial, "Local credit union urges 'Don't Tax My Credit Union,'" in the Tampa Bay Times' Pasco County edition (July 26).

That is "96 million members to be exact, and 4.6 million of those are Florida credit union members," said Tim Baldwin, San Antonio Citizens' president, quoted in the advertorial, which urged members and non-members to contact their congressional representatives as part of the Credit Union National Association's and state leagues' national campaign to preserve credit unions' tax-exempt status.

The credit union is one of many sharing the "Don't Tax My Credit Union" message.

For example, the Missouri Credit Union Association reported that many credit unions in the state participated in Don't Tax My CU Tuesday on July 23 by using Twitter and Facebook to share the #DontTaxMyCU message (The Missouri Difference July 25). Between May 22 and July 24, Missouri's U.S. lawmakers received 9,634 contacts in support of credit unions' efforts.

BluCurrent CU, CommunityAmerica CU, St. Louis Community CU, Anheuser-Busch Employees' CU, Vantage CU and Arsenal CU tweeted multiple messages, as did MCUA and Credit Unions of Missouri Twitter accounts, and 11 credit unions in the state used their Facebook pages.  Many included original content specific to DTMCU Tuesday. CSD CU, Kansas City, shared members' stories, explaining how the credit union helps them financially.

Arsenal CU in Arnold, Mo., and Electro Savings CU in St. Louis sent e-mails to thousands of members urging them to write Congress. "The question isn't why did we engage our members in this battle and ask for their support, the question is why not?" Electro President/CEO Stan Moeckli told MCUA.

"Our members are our owners and stakeholders. It is our responsibility to them to engage them in this fight. How would we explain it to them if we lose the fight and they did not know what was on the line? As a member-owner of Electro Savings, I would be upsett with my credit union if I wasn't made aware," he said.

League of Southeastern Credit Unions President/CEO Patrick La Pine told The Anniston Star (July 25) that if the tax exemption is removed, credit unions will face extreme uncertainty. Credit unions are built on a member-owned cooperative model that would have to be revisited if the exemption were removed and the change would force many to merge or convert their charters, he told the publication.

He noted that credit unions' tax exemption is not based on products and services they offer but on their not-for-profit, member-owned, cooperative structure.

Preserving the tax status is part of the "removing barriers" and "raising awareness" goals in the Unite for Good campaign toward the strategic vision in which "Americans choose credit unions as their best financial partner."

Illinois Young Professionals Advisory Committee Established

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NAPERVILLE, Ill. (8/1/31)--The Illinois Credit Union League Tuesday announced the members of its Young Professionals Advisory Committee.
 
The committee was established to help create a state-wide program that encourages young credit union employees to establish life-long involvement with credit unions. 
 
It will examine activities and initiatives of other state leagues, similar organizations such as chambers of commerce or charitable groups, and past programs of the Illinois Youth Involvement Council. 
 
Serving one-year terms, effective July 1, are:
  • Jana Stevens, CEFCU, Peoria;
  • Wednesday Medlen, Community Plus FCU, Rantoul;
  • Scott Leiser, Cornerstone CU, Freeport;
  • Derrell Walls, CTAFC FCU, Chicago;
  • Diara Bradley, First Financial CU, Chicago;
  • Parease Alexander, Maroon Financial CU, Chicago;
  • Melissa Clopper, Members First Community CU, Quincy;
  • Aaron Heldt, NuMark CU, Joliet; and
  • Jennifer Riebold; Scott CU, Edwardsville.

Malware Report: 1.8 Million Virus Detections In Q2

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CEDAR RAPIDS, Iowa (8/1/13)--Computer virus infections increased 39% during second quarter from the previous quarter, with 1.8 million virus detections, according to a new quarterly malware (malicious software) report.
 
Of the viruses detected, 25% exploited Java vulnerabilities in their attempt to gain access to computers, said the SecureIT Quarterly Malware Report for second quarter, released Wednesday by SecurityCoverage Inc., a  Cedar Rapids, Iowa-based provider of mobile and desktop security software and data support services.
 
Credit unions aware of cybersecurity issues impacting themselves and their members can caution members about keeping their Java software up to date to help protect their information.
 
Problems such as fraud generated with the use of malware and viruses have prompted the introduction of several laws, including the  Cybersecurity Act of 2013 (S. 1353), which passed out of a committee on  a voice vote Tuesday (News Now July 31).
 
The Credit Union National Association and other trade groups in a letter Tuesday in support of the bill noted that national cybersecurity efforts require active participation of the government, business and every consumer.

The bill would encourage the private and public sectors to collaborate on standards, guidelines and best practices; increase research and development for the design and testing of software; upgrade education so the work force and students will be better prepared to stimulate and support innovation in cybersecurity; and promote a national cybersecurity awareness campaign.
 
Other findings in the SecureIT report included:
  • A 57% hike in Zeus Trojan or Zbot detections. The Zeus Trojan has been used to steal millions of dollars from U.S. financial institutions and consumers.
  • A 34% increase in adware, viruses that bog down a computer with pop-up ads. Adware, though not generally malicious,can cause overloads and crashes on already infected computers, said SecurityCoverage.
  • Roughly 82% of total malware detections were Trojan-based. Leading the pack were the Trojans OpenConnection, Kazy, ZeroAccess, PasswordStealer and Medfos, the report said.
"We anticipate malware authors will continue to evolve their attention to fast-growing mobile platforms in the months to come, but we expect to see an active malware environment in the desktop space as this remains a viable business and personal platform for many users," said Ed Barrett, vice president of marketing and communications at SecureCoverage Inc.

Jury Elected To World Council Exec Committee

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OTTAWA, Canada (8/1/13)--Patrick S. Jury, CEO/president of the Iowa Credit Union League, is the newest member of the World Council of Credit Unions' Executive Committee.
 
Jury, one of four representatives of the Credit Union National Association to the World Council's board of directors, was elected the committee's secretary last month during the World Credit Union Conference in Ottawa, Canada.
 
Others already on the executive committee include:
  • Chair Grzegorz Bierecki of the National Association of Cooperative Savings and Credit Unions in Poland;
  • Vice chair Anne Cochran, president/CEO of the Louisiana Credit Union League and representing CUNA;
  • Second vice chair David Burns, Credit Union Central of Canada; and
  • Treasurer Louise Petschler, Customer Owned Banking Association, Australia.
Jury has served as CEO/president of the league since 2006 and has worked there for more than 20 years.  He is also CEO and board chairman of Affiliates Management Co. providing oversight of The Members Group, TMG Financial Services, PolicyWorks and Coopera.

Newly elected to World Council's board of directors were Steven Stapp, president/CEO of San Francisco FCU, representing CUNA, and Oswaldo Olivia of the National Association of Credit Unions of Guatemala.

15 Detroit CUs' Rewards Program Boosts Commerce

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WYANDOTTE, Mich. (8/1/13)--Fifteen Detroit credit unions Tuesday rolled out Shop Main Street, a merchant-funded rewards program, with the hope of sparking a lagging local economy.
 
 About 250,000 credit union members who have a credit or debit card tied to a loyalty program offered by one of the credit unions earn bonus rewards when they shop at local merchants participating in the program. The rewards are in addition to the rewards members already earn from their loyalty program when using their card for purchases.
 
"This year marks our 75th anniversary, and we're a community credit union now," said Jan VanWassehnova, executive vice president of NuPath Community CU, Wyandotte, Mich. "We can mark that anniversary by supporting our merchants downtown and rewarding our members for shopping locally."
 
The program offers participating merchants a suite of online marketing tools. Shop Main Street lets participating merchants choose from more than 20 different offers to address their business objectives.
 
The program also features content, including merchant news, and links to Facebook and Twitter, which bring "word-of-mouth" marketing to a wider audience.  Shop Main Street gives merchants information about their customers and their purchasing behavior.  Since Shop Main Street is integrated into local credit unions' loyalty programs, merchants benefit from increased consumer awareness and interest.
 
With her credit union entering into the business services market this month, VanWassehnova, said the Shop Main Street program came at the right time for her credit union. "We view it as a partnership with our local merchants," VanWassehnova said. "We promote for our local businesses and we drive our members to shop at their locations. And the merchants provide whatever offers they want."
 
Shop Main Street was developed by RewardsNOW and Zavee LLC. Both companies are developers of member loyalty programs.
 
Rewards programs are one way credit unions help local businesses. Credit unions also offer member business loans. The Credit Union National Association and credit unions nationwide are urging Congress to pass bi-partisan legislation to increase their member business cap to 27.5% of a well capitalized credit union's assets--up from the current 12.25% cap. CUNA estimates that lifting the MBL cap would create 140,000 jobs and inject $13 billion in new funds into the economy, at no cost to taxpayers.

League Staffer Elected Chairman Of Calif. Jump$tart Coalition

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ONTARIO, Calif. (8/1/13)--Tena Lozano, the California and Nevada Credit Union Leagues' consumer advocacy manager and executive director for the Richard Myles Johnson (RMJ) Foundation, has been elected chairman of the board of the California Jump$tart Coalition--the state chapter of the national not-for-profit organization that promotes financial literacy among the nation's youth.
 
"The coalition's mission very much parallels the Richard Myles Johnson Foundation's goal of improving the personal financial education of young people," said Lozano.
 
The 19-member board implements the mission and vision of the National Jump$tart Coalition for Personal Financial Literacy in the state. It assists the personal finance education community and supports the implementation of personal finance education from Kindergarten through 12th grade. The board consists of professionals from education, finance and accounting, business and government.
 
The California Credit Union league has been associated with the state Jump$tart Coalition since its organization in 2000. Lozano became a member of the coalition in 2007 through her work with the foundation. The RMJ Foundation for California and Nevada for credit unions supports youth financial education and continuing education for credit union leaders.
 

Three Ways To Connect With Millennial Homebuyers

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DALLAS (8/1/13)--As they mature, Gen Y members are becoming prime targets for the mortgage market.
 
Here are three ways credit unions can position themselves to serve Gen Y's mortgage needs:
  • Offer education on home-buying opportunities. Provide rent vs. buy calculators to help them see the savings in purchasing a home, advised CU Members Mortgage Senior Vice President Linda Clampitt. First-time homebuyer seminars also help motivate buyers and set proper expectations.
  • Make products available. Most Millennials don't have large sums of cash at their disposal, yet they don't want to delay their housing needs to save a large down payment, Clampitt said. The Federal Housing Authority (FHA) is still a low down payment option for them. If credit unions aren't offering FHA assistance, they need to know Gen Y has a growing need for this program.
  • Provide technology solutions. Gen Y members want their needs met on demand, even with home loans. An online home loan application provides the opportunity to apply at their convenience, she said.