CHICAGO–Changes on the NCUA board. A voluntary liquidation over the issue of regulations. News that two men involved in abduction/robberies at CUs had even more planned at the time of their arrest. Those stories and more dominated the first four months of 2016. Below is an overview of some of the top stories reported by CUToday.info from January through April.
Week Of January 11, 2016
CU at Which CFO Allegedly Embezzled $20M Put Into Conservatorship
PONTIAC, Mich.–State regulators moved to take over a CU where the former CFO is claiming he stole $20 million over 12 years. The director of the Michigan Department of Insurance and Financial Services on Wednesday placed Clarkston Brandon Community Credit Union into conservatorship and appointed NCUA as conservator.
NCUA Board Member McWatters Nominated for Seat on Export-Import Bank Board
WASHINGTON—President Barack Obama Monday announced his intent to nominate NCUA Board Member Mark McWatters to serve on the board of directors of the Export-Import Bank of the United States. McWatters issued a statement saying he "intends to remain fully engaged" on matters coming before the NCUA board during the confirmation process.
Banks vs. Credit Unions? CUs Win When It Comes to One Big Category
WASHINGTON—Credit unions outpaced commercial banks across all consumer lending and asset quality categories, according to research conducted by Callahan & Associates on third quarter data released by NCUA and the FDIC. The data is based on figures for 6,216 credit unions and 5,410 commercial banks.
Week of Jan. 18
A ‘Record’ Fourth Quarter for New Regulations, Analysis Finds
NEW HAVEN, Conn.–Community financial institutions (CFIs) faced a record-breaking 125 regulatory issuances during the fourth quarter of 2015, increasing the total number of regulatory pronouncements to 329 for the full year 2015, according to the Banking Compliance Index.
Michael LaJoice at hearing.
Ex-CU CFO Urged To Undergo Mental Competency Test After Alleged $20M Theft
CLARKSTON, Mich.–The former credit union CFO who is a suspect in an embezzlement of as much as $20 million will undergo a mental competency hearing at Michigan’s Center for Forensic Psychiatry. Michael A. LaJoice, 36, the former CFO at Clarkston Brandon Community Credit Union, is currently facing 14 counts of embezzlement totaling more than $100,000 between October and December 2015. Allegedly, however, LaJoice confessed to the Oakland County Sheriff's Office that he took $20 million from the credit union over a 12-year period.
Internet Archive FCU, A Start-Up Critical Of Over-Regulation, Self Liquidates
NEW BRUNSWICK, N.J.–Internet Archive FCU here has voluntarily liquidated and paid all of its members their shares in full. The credit union, which has received media coverage from national outlets that include the New York Times over its allegations that NCUA had stymied its development and growth, has struggled since its founding in 2012. At the time it closed it had $2.25 million and served 391 members.
Week of Jan. 25, 2016
Banks Vs. CUs On Free Checking
LAKE FOREST, Ill—Free checking offerings fell in 2015 to 59.3% of all financial institutions, down from a high of 81.5% in 2009, according to a new analysis that suggests the trend is driven by differences in how banks and credit unions view consumers. The decline represents a drop of 27.2%.
Feds Say Suspects In Abduction/Robberies of CU Employees Had Plans For More
KNOXVILLE, Tenn.–The two men suspected of a string of abduction/robberies during 2015 in Tennessee in which credit union employees were confronted in their own homes had plans at the time of their arrests to attempt similar kidnappings in South Carolina, federal authorities are alleging.
Analysis Urges CUs To Strengthen Liquidity Profile As Rates Rise
DALLAS—A new report on recent economic data suggests that strengthening liquidity profiles should be a primary strategic objective now for credit unions in this rising-rate environment—and that auto lending could be slowing.
Week of Feb. 1, 2016
CFPB Warns Banks, CUs About 'Murky' World of Checking'
Jim Blaine inside SECU's offices.
WASHINGTON—Saying it is taking steps to improve checking account access amid concerns that consumers are being sidelined by inaccurate information used to screen potential customers, the CFPB is warning banks and credit unions about their “obligations” to be accurate when sharing consumer checking data to credit reporting companies.
Jim Blaine Offers Thoughts on Issue of CUNA/League Choice, Impending Vote
RALEIGH, N.C.—It’s expected that CUNA’s proposed bylaws revisions may come up for a vote soon, possibly at its Governmental Affairs Conference in Washington this month. But Jim Blaine, president of State Employees’ CU, says CUs should not just assume they will be given the option of joining a state league OR CUNA.
Where Were Regulators During Long-Term Frauds? NCUA Offers Its Answer
ALEXANDRIA, Va.—It is almost always the first question asked when long-term fraud is discovered inside a credit union: where were the regulators? CUToday.info posed that question to NCUA, which did not have anyone available for an interview at press time, but which did have an agency representative respond via email. NCUA will be discussing the issue with CUToday.info next week.
Week of Feb. 8, 2016
NCUA FOM Comment Letters Exceed 10,000
ALEXANDRIA, Va.—NCUA’s field of membership proposal had drawn 10,500 comments by Tuesday morning, NCUA reported. CUToday.info reported Monday that FOM comments by Friday had already shattered the previous record high of 3,100 comments for the Member Business Lending rule last year.
Bank Group Urges Members To Help ‘Stop the CU Grab’
WASHINGTON—Under a website banner headlined, “Stop The CU Grab,” the Independent Community Bankers Association (ICBA) has been urging its members to file comment letters with NCUA on its proposed changes to FOM rules.
CUNA Distributes Revised Bylaws To Members; Voting to Follow
WASHINGTON—As CUNA promised earlier this month, the trade association has distributed its revised bylaws to member CUs and the leagues.
Week of Feb. 22
30 Members Of House Call on NCUA To Extend Exam Cycle
WASHINGTON—A bipartisan group of 30 members of the U.S. House of Representatives, led by Reps. Frank Guinta (R-NH) and Rubén Hinojosa (D-TX), has signed a letter to NCUA Chairman Debbie Matz asking for the 18-month exam cycle to be extended to well-run credit unions.
CUNA Mutual Donates $1 Million To Underwrite First Filene Center of Excellence
MADISON, Wis. – CUNA Mutual Group has made a $1 million contribution to the Filene Research Institute to fund the first of a planned five Centers of Excellence, which will offer deeper, more focused and practical research and direction. The first Center will be the Center for Consumer Decision Making. Plans call for all five centers to be in place by 2017; sponsors for the other Centers have not been announced.
CUNA Mutual Investing In New Direct-to-Consumer Lending Platform
MADISON, Wis.–CUNA Mutual said it is investing in a new direct-to-consumer lending platform, SpringboardAuto.com. The new technology solution provides a direct online auto loan platform so credit unions can lend to members with below-prime credit ratings without creating additional credit or operational risk for the credit union, according to CUNA Mutual.
Week of Feb. 29
WASHINGTON—NCUA Vice Chair Rick Metsger Tuesday held up the “network credit union model” as one potential way to help smaller, struggling credit unions not only survive but grow.
Membership Growth Sets Record in 2015 As 105.2 Million Americans Now Belong to CUs
MADISON, Wis.–Membership growth in 2015 was the fastest in history, as some 3.8 million new members were added to bring the total number of members to 105.2 million, or 32.5% of the total U.S. population, according to CUNA Mutual’s Trends Report for December 2015.
New Record Set For Amounts Financed, Average Monthly Payment On Vehicles
SCHAUMBURG, Ill.—The average amount financed and the average monthly payment for a new vehicle continue to climb, breaking previous records, according a new report.
Week of March 7
CFO Kidnapped In Robbery Attempt Shares Details of Ordeal
NEW BRITAIN, Conn.—At about 3:00 in the morning on Feb. 22, 2015, Matthew Yussman walked up to his mother, who had been tied to her bed by two armed robbers, and refused to kiss her goodbye.For Yussman, the CFO at Achieve FCU who had been confronted and then kidnapped in his own home by the two robbers, it would be one of the worst points in what was about to become a year-long series of low points that would involve fears for his life and that of his mother, people video-recording him in case a bomb detonated so they could upload the video to YouTube and, worst of all, becoming a suspect himself in the crime by police and the FBI who didn’t believe him.
NCUA Chairman Announces Plans To Leave Post
ALEXANDRIA, Va. –NCUA Chairman Debbie Matz announced she will step down from the job on April 30, after nearly seven years in her current position. Matz’s departure could mean significant changes for the make-up of the NCUA board. Current board member Mark McWatters has been nominated for a board seat on the Export-Import Bank and, if confirmed, will also leave NCUA. That would leave Vice Chairman Rick Metsger as the only board member. The eventual make-up of the board will also be determined by the outcome of the presidential and congressional elections.
Study: CUs Twice As Likely As Banks to Offer Free Checking
NEW YORK—Credit unions are more than twice as likely than banks to offer free checking to a consumer who is new to the organization, a new study shows.
Week of March 14, 2016
BRISTOL, Penn.—One small credit union that has grown its assets by 25% over the past 18 months says the key is to have a detailed plan and be willing to take some calculated risks. With the full backing of the board, Jim Merrill has engineered sweeping changes at the $105-million Inspire FCU here, knowing the organization had to grow to survive.
Satisfaction with Regulator Exams Rises in Survey
MADISON, Wis.—More credit union CEOs are satisfied with their exams (65%) than dissatisfied (21%), according to CUNA’s 2015 Exam Survey.
Start-Up Credit Union Turning To Crowdfunding
HARRISBURG, Penn.–A start-up credit union that plans to launch later this year is turning to crowdfunding. The Tenants and Landlords Community Federal Credit Union, which is being created to serve this city’s low-income population and which plans to open by summer, has created a crowdfunding page ahead of its next fundraising event, set for April 9.
Week of March 21, 2016
NCUA Says System Should Cut Exam Time, Lengthen Exam Cycles
ALEXANDRIA, Va.—By a 3-0 vote, the NCUA board Thursday approved adding two temporary positions to lead the agency’s Enterprise Solutions Modernization Program (ESMP), which ultimately should lead to shorter on-site exams and contribute to a longer exam cycle, according to the agency. Costs are expected to be $75,000 annually for four years, which includes the differences in salary and travel expenses for the two temporary positions that will be added, compared to two field positions that are being eliminated to cut costs.
CUNA Affiliates Vote in Favor of 'Choice' On League, CUNA Membership
WASHINGTON–CUNA’s affiliated credit unions have voted overwhelmingly in favor of a new membership model that gives CUs the option of belonging to the traditional CUNA/league model, or individually to either CUNA or their respective league.
Study: Traditional FI Services Less Compelling to Millennials, But Opportunity For CUs
ANAHEIM, Calif.—A new study reveals that traditional financial services are less compelling to Millennials, who define success through their family and children. The report also suggests credit unions have a strong opportunity with this demographic, but need to increase their awareness with the group.
Week of March 28
BIRMINGHAM, Ala./TALLAHASSEE, Fla.—With CUNA’s revised bylaws now in place, expect league consolidation to pick up in the coming years as leagues seek ways to cut costs and partner in new ways.
CU Conserved After CFO's Alleged Theft Is Merged
PONTIAC, Mich.–The credit union at which the former CFO allegedly said he embezzled more than $20-million has been placed into conservatorship. The director of the Michigan Department of Insurance and Financial Services on Wednesday placed Clarkston Brandon Community Credit Union into conservatorship and appointed NCUA as conservator.
Despite Durbin, Debit Card Reward Programs Remain Vibrant
SHREWSBURY, Mass.—Debit card reward programs, once considered a dying breed as the Durbin rules took hold, are still going strong at many of the nation's largest financial institutions, a new study shows.
Week of April 4, 2016
NCUA's Mark McWatters.
McWatters Suggests There Will Be Moratorium On New NCUA Regs
LAS VEGAS–NCUA Board Member Mark McWatters said there will essentially be a moratorium on new regulations from NCUA once he’s part of a two-member board after the chairman departs, and further added he doesn’t expect the Senate to move on his nomination to the Export Import Bank.
LAKE FOREST, Ill—In battle for checking accounts, banks and credit unions are taking two very different strategies, according to one economist who believes that in the end consumers are coming out on top.
State Regulator Offers Plan to Recalculate OTR
BISMARCK, N.D.–North Dakota’s state regulator has sent a comment letter to NCUA in which he outlines ways in which the agency can correct what he sees as weaknesses in the current overhead transfer rate (OTR) methodology, which is used to determine funds transferred from the NCUSIF to NCUA’s operating budget to reflect the cost of examining state charters.
Week of April 11, 2016
NCUA Chairman Debbie Matz Shares Parting Perspective
ALEXANDRIA, Va.–When Debbie Matz steps down as chairman of the National Credit Union Administration on April 30, it will bring to a conclusion a chairmanship that will have seen perhaps more change and flux than the term of any other NCUA chairman.
BROWNSTOWN, Mich.–A new sales incentive structure that involves most of the credit union—including the collections team—is being credited for driving a 26.5% increase in lending at Advantage One FCU.
PSCU Members Forum: Look For These Key Payment Trends in 2016
NASHVILLE, Tenn.—From fintech startups eventually declining in number to the possibilities for blockchain, one analyst addressed emerging trends in payments and banking during PSCU’s 2016 Member Forum.
Week of April 18, 2016
Bob Hackney of CSCU.
DALLAS—Just six years after the Great Recession, are borrowers and lenders forgetting the (very recent) past? Analysts interviewed by CUToday.info are in agreement: the answer is yes and no for a number of questions. Are lenders taking on too much risk and lowering standards on loans just to keep the lending pipeline full? Are consumers saddling themselves with debt bordering on unmanageable levels—threatening their personal balance sheets and possibly the economy?
CSCU’s Hackney: Mobile Payments Not Addressing ‘Pain Point’
ORLANDO—Mobile payments adoption has gone slower than many expected, and a big reason is that digital wallets are not yet addressing a consumer pain point. CSCU President and CEO Bob Hackney emphasized that message during the opening session of the company’s Solutions 2016 annual conference here, emphasizing to credit unions that the slow adoption is no reason to wait to begin formalizing a mobile payments strategy.
Nearly A 400% Increase In ‘Data Exposure Incidents’ Over Last Decade
SCOTTSDALE, Ariz.–Since 2005 there has been a 397% increase in data exposure incidents across financial services, business, education, government and healthcare sectors, according to the Identity Theft Resource Center (ITRC)