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CU System Archive

CU System

CUs among defendants in mobile banking patent suit

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SAN FRANCISCO (9/15/10)--Four credit unions and several banks are among the entities seeking dismissal of a mobile banking patent infringement lawsuit brought by MShift against Digital Insight Corp. (now called Intuit Financial Services or IFS). The defendants' motion to dismiss alleges the patent in question is outmoded and "solves a problem that no longer exists." MShift, a company headquartered in Fremont, Calif., filed the suit initially against Digital Insight on Feb. 19 in the U.S. District Court for the California Northern District (San Francisco). In June, MShift amended its complaint to include the credit unions, eight banks and Mobile Money Ventures, a mobile banking technology provider. The credit unions named in the complaint include Meritrust CU, Wichita, Kan.; Professional FCU, Fort Wayne, Ind.; Fort Worth (Texas) Community CU; and USE CU, San Diego. MShift's suit alleges its patent for a system for converting wireless communications for a mobile device was infringed by Intuit and the others. The patent No. 6,950,881, referred to as Patent '881 in the suit, was granted by the U.S. Patent and Trademark Office on Sept. 27, 2005, to Awele Ndili, MShift's former CEO. The patent was for a "conversion engine" that provided language to translate the contents of a Web page so it could display on mobile phones. Originally mobile phones were text-based browsers that didn't speak the Web HTML language, and they could not display Web pages the same as the pages displayed on desktop computers, said the complaint. In addition to the translation language, MShift also restructured multiple text boxes, which were graphic features or "input entries," into standard links that could display on the mobile devices. According to the defendants' motion to dismiss the case, none of this technology is necessary today, and there is no "first language" and "second language" involved in conversions because most mobile devices display the pages the same as on desktop--without the need to restructure. The suit claims MShift contracted with Digital Insight as a reseller of its technology. It seeks damages for the patent infringement claim against all the defendants, a breach of contract against IFS, and unfair competition against IFS.

Study CUs make up 6 of phishes for third month

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BEDFORD, Mass. (9/15/10)--Phishing attacks spiked during July, with a 21% increase in the number of attacks worldwide over June, according to RSA's Online Fraud Report for July. Attacks against credit unions remained steady, at 6% of the attacks. July saw a total of 16,756 phish attacks, where send fake e-mails and other messages pretending to be a financial institution or other institution in hopes of tricking recipients into divulging personal financial information. That compared with 13,844 phish attacks in June. While down significantly from January's 18,820 attacks, July's attacks were 3,544 more than in July 2009, said the report. "While there was a sharp spiked in phishing attacks, our analysis shows this growth can be directly attributed to an increase in the number of attacks launched against a handful of large entities," said RSA. National banks remained the most targeted financial segment in the U.S., although they dropped slightly in the percentage of attacks--to 64% from June's 68%. That is nearly three times the number of attacks they suffered in July 2009, when they were hit by 25% of the phish attacks. Regional banks saw 30% of attacks during July, a 4% increases from June's 28% of attacks. In January, they accounted for 61% of the attacks. A year ago, regional banks suffered 58% of the attacks. Credit unions remained consistent--at 6% of attacks--for the third month in a row. That was nearly two-thirds less than the 17% of attacks they weathered in July of last year. They have dropped from 14% in January and 12% in February, to 4% in both March and April, before increasing to 6% in May. The U.S. remained the largest country for both hosting attacks--it hosted 61% of the phishing attacks--and for being targeted--it had 47% of attacks. Phishing attacks were launched against 217 brands worldwide, one brand more than in June. The number of brands targeted fewer than five times during the month was similar to June's total. For July's report, RSA fraud analysts went window shopping in the cybercriminal marketplace. They produced a shopping list, and priced the goods and services bought and sold by cybercriminals. RSA fraud analysts discovered that credit card information is being sold for less than the price of a cup of coffee. Most goods are going for less than $50, providing criminals with a strong return on investment as the products yield hundreds or thousands of dollars at victims' expense. For more details on the shopping list, use the link.

In the Media CUs grow faster than banks

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MADISON, Wis. (9/15/10)--Credit unions are growing faster than banks, as they generate lots of interest from consumers, according to several media reports. Philadelphia Police and Fire FCU, which has $3.7 billion in assets, had a 45% increase in total assets since 2007, to $8.2 billion as of June 30, reported The Philadelphia Inquirer (Sept. 12). This compares with a 12% growth in assets at area banks. Credit unions in the Philadelphia area have surged during the past three years because of friendlier service at a lower cost, the newspaper added. It also quoted Walt Ross, a Citadel FCU member who joined after banking with Susquehanna Bank. Ross was thrilled when the Thorndale, Pa.-based credit union opened a branch near his home in Chester County. Citadel FCU has $1.5 billion in assets. University of Iowa Community CU, Iowa City, Iowa, said its mortgage lending volume was more than double in August compared with last year. Refinancing demand made August one of the credit union’s best months in history for mortgage demand, Amy Henderson, vice president of mortgage lending, told The Cedar Rapids Gazette (Sept. 11). The credit union has $986.2 million in assets. John Forck of Cedar Rapids told the newspaper that he and his wife got a financing offer from the credit union to reduce the couple’s home interest rate by 1.4%, shorten their loan term and tap their home equity to upgrade their home. Refinancing demand at Collins Community CU, Cedar Rapids, was up 120% over last year. The credit union has $591 million in assets. The loan officers are “wearing thin,” Steve Shepherd, executive vice president, told the newspaper.

OnPoint Communitys new branches create 26 jobs

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PORTLAND, Ore. (9/15/10)--OnPoint Community CU in Portland, Ore., is continuing its investment and expansion in the Pacific Northwest with the addition of three new branches in Deschutes County, which will create 26 new jobs. Members of OnPoint in Deschutes County have access to a suite of personal and business banking services, including basic and interest checking, savings accounts, money market accounts, auto and residential lending, Rewards Visa credit cards, certificates of deposit and individual retirement accounts, and investment- and retirement-planning services. The new branches opened Sept. 7 but will have individual grand openings during this month. “We believe that Central Oregon is a viable and attractive area to live, vacation and conduct business--and will continue to be for many years to come,” said Rob Stuart, OnPoint president/CEO. OnPoint Community CU has more than $2.8 billion in assets.

USA FCU Navy Fed announce merger

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VIENNA, Va. and SAN DIEGO (9/15/10)--Navy FCU of Vienna, Va., and USA FCU, based in San Diego, announced Monday that they have agreed to merge. Each credit union’s board of directors approved the merger. The newly combined credit union is slated to begin joint operations as Navy FCU, Oct. 1, pending approval by National Credit Union Administration (PRNewswire Sept. 13). The combined credit union will have more than 200 branches worldwide, with 22 in Southern California, more than $43 billion in assets and more than 3.5 million members. All USA FCU’s 19 branches--eight in Southern California and 11 military base branches in Japan and Korea--will become part of the Navy Federal branch network. All USA FCU employees will be invited to join Navy Federal, and the USA FCU’s San Diego headquarters building will become Navy Federal’s West Coast operations center. Members will be notified of the merger and will have access to additional information posted on the two credit unions’ websites and in branch offices. “… Navy Federal is an excellent choice for us,” said Mary Cunningham, CEO of USA FCU. “We share the same commitment of service to our members--the men and women in uniform who serve our country and the San Diego community. We’re confident that this will provide valuable opportunities for members and employees.” “The merger with USA FCU is a great opportunity for both of our credit unions as we unite our members, employees and operations,” said Navy Federal President/CEO Cutler Dawson, noting the merger “strengthens our presence in Southern California and expands our branch access for members--here and overseas.”

Texas ads thank Congress members who stood tall for CUs

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FARMERS BRANCH, Texas (9/15/10)--The Texas Credit Union League unveiled its new series of “Congressional Thank You Ads” for member credit union newsletters to thank Texas congressional members who supported credit union issues. The ads are part of the league’s efforts to share information with millions of Texas credit union members about key issues that affect them. “We wanted a way to inform members of where their representatives stood during the most recent legislative session in Washington,” said Jim Phelps, league political and grassroots director. “Over the past several months, our credit unions engaged in a level of grassroots advocacy not seen since 1998 in the battle for H.R. 1151. “Throughout the process, many of Texas’ congressional representatives openly and publicly supported credit union positions, in the battle to preserve interchange and lift the cap on member business lending,” he added. “This is our opportunity to share that information with those most impacted by the changes--credit union members.” The ads indicate whether Texas congressional delegation members supported credit unions on interchange by publicly signing onto a critical “Dear Colleague” letter to Senate-House conferees. U.S. Rep. Kenny Marchant (R-Texas) was an original interchange letter sponsor, and more than half the Texas congressional delegation from both parties signed the letter within a week of being asked. The ads also note whether a Texas congressional delegation member publicly sponsored member business lending legislation to lift the current cap, H.R. 3380. In all, five Texas Democrats (Gene Green, Sheila Jackson-Lee, Eddie Bernice-Johnson, Solomon Ortiz, and Ciro Rodriguez) and three Texas Republicans (John Culberson, Ron Paul, and Ted Poe) co-sponsored the legislation. The legislative communication ads to credit union members are divided by region and developed to ensure compliance with federal law. Also, the ad directs readers to the league’s CUVoice website (CUVoice.com)--a credit union member advocacy forum--to learn more about key legislative issues, and thank their member of Congress by e-mail or phone for supporting their credit union. Most ads will appear in fall credit union newsletters. Phelps estimated that more than a million Texas credit union members will receive the ads this year.

CEO testifies on capital access for N.J. businesses

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TRENTON, N.J. (9/15/10)--Issa Stephan, president/CEO of First Financial FCU, Toms River, N.J., testified Monday at a New Jersey Assembly Financial Institutions and Insurance Committee hearing on access to capital for New Jersey businesses. The committee had requested testimony regarding businesses’ access to capital for improvement and expansion, and the extent to which credit is available to consumers and homebuyers, said the New Jersey Credit Union League (The Daily Exchange Sept. 14). Credit unions play a vital role in the state’s economy, Stephan said. Small business lending at New Jersey credit unions is up more than 31% year-over-year, and about 20% of the state’s credit unions now offer business loans, he said. Stephan also mentioned a push in Washington, D.C., to raise credit unions’ member business lending caps to 27.5% from 12.25%. The cap increase would enable credit unions to play a greater role in the financial well-being of individuals, small businesses and the public sector, he added. The amendment fell short of a Senate vote Tuesday, but the Credit Union National Association and credit unions will continue to push for the increase in caps.

CU System briefs (09/14/2010)

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* MINNEAPOLIS (9/15/10)--A Minnesota man has been sentenced to nearly six years in prison for the armed robbery of the Minnesota Building Trades FCU's Inver Grove Heights branch last October. Herman Wilson, 44, had pleaded guilty to stealing $21,459 from the credit union on the morning of Oct. 8 and threatening to kill employees of the $109.4 million asset credit union. During the robbery, Wilson wore a surgical mask, goggles and neon construction vest during the incident and carried a kitty-litter bucket with a black bag and a semi-automatic handgun. He was arrested Dec. 2 (Star-Tribune Sept. 4) ... * CHARLESTON, W.Va. (9/15/10)--A former teller of the now-defunct N&W Poca Division FCU in Bluefield, W.Va., pleaded guilty Monday to federal information charging her with bank fraud related to the theft of $2.4 million (Associated Press via businessweek.com Sept. 14). The theft contributed to the $6 million asset credit union's failure and the National Credit Union Administration liquidated it on Oct. 3, 2008 (News Now Aug. 5). Pamela Mullins, 47, of Bluefield, faces up to 30 years in prison and a $1 million fine for her role in the theft. In August, a federal grand jury in Beckley indicted the credit union's assistant manager, Rebecca Poe, 35, of Falls Mills, Va. The women allegedly took the money from 2003 to August 2008. Poe's trial is set for Oct. 19. Mullins is scheduled for sentencing in January (WSAZ.com Sept. 14) ... * NAPERVILLE, Ill. (9/15/10)--Joe Kregul became CEO of Naperville, Ill.-based HealthCare Associates CU, effective Sept. 1. Kregul has 30 years of experience in the financial services industry, including the past 13 in the credit union field. Since 1998, he has served as the credit union's vice president/chief financial officer overseeing its accounting/finance, member services and member support operations. Kregul has also served on the board and as secretary and chairman of the Aurora Chapter of Credit Unions for several years. He succeeds Jane Brannon as CEO ...