Jackie Buchanan, Theresa Mann, Todd Marksberry and Greg Mitchell Re-elected; Benson Porter of BECU to Serve a Second Year as Board Chairperson
May 17, 2022 – Harold Roundtree, President/CEO of UNCLE Credit Union of Livermore, California, has joined the Board of Directors of Co-op Solutions following the company’s annual meeting of shareholders held May 3. Four other credit union leaders were re-elected to their posts on Co-op’s 11-member Board.
Elected to a first term on the Co-op Board, Roundtree has served as UNCLE’s President/CEO since joining the credit union in 2011. Prior to that, he was SVP at Technology CU, working there from 1994 to 2011. His career in financial services also includes work with World Savings and First Interstate Bank.
Four other Board positions were up for election, with four members re-elected, including Jackie Buchanan, President/CEO of Genisys CU from Michigan; Theresa Mann, VP/Chief Risk Officer of NASA FCU from Maryland; Todd Marksberry, President/CEO of Canvas CU from Colorado; and Greg Mitchell, President/CEO of First Tech FCU from Oregon.
“I want to congratulate the five Board candidates on their elections, each to serve three-year terms,” said Benson Porter, President/CEO of BECU in Washington state, and Co-op’s Chairperson of the Board. “Jackie, Theresa, Todd and Greg have made significant contributions to the oversight of Co-op. And, we welcome Harold to the Board, bringing more than 30 years of financial services experience to the table.”
Following the annual shareholders meeting, the Co-op Board held an organizational meeting that confirmed the body’s current leadership for another year – Porter, Board Chairperson; Joan Opp, President/CEO of Stanford FCU of California as Board Vice-Chairperson; Buchanan as Treasurer; and Mann as Chairperson of the Board’s Audit Committee.
In addition to the seven Board members mentioned above, Co-op’s Board includes four additional members – Robert Chavez, Sandia Laboratory FCU, from New Mexico; Bob Falk, Purdue FCU, from Indiana; Wayne Grosse, Bethpage FCU, from New York; and Rudy Pereira, Premier America CU, from California.
Co-op Solutions is the market-leading financial technology platform whose mission is to connect credit unions to the technology, strategic partnership and scale they need to best serve their members now and into the future. Co-op partners with credit unions to unlock their potential so they can compete; does the hard work of innovation, creating a one-stop opportunity to help credit unions grow; and offers knowledge and expertise in a world where everything must be integrated. For more information, visit coop.org.
NACUSO presented variations of the prestigious CUSO of the Year Award to four CUSOs at their 2022 annual conference. The award presentations took place on Day 3 of the conference: Wednesday April 27 in Orlando, FL at Disney’s Yacht & Beach Club Resorts Convention Center.
The CUSO Awards have evolved over the years as they date back to 1998, but the core purpose of the awards remains; to recognize CUSO’s with stories of great accomplishments and innovation that push for advancements within the industry.
CUSOs nominated for the awards are then evaluated by NACUSO’s award committee which is no easy feat. The awards committee conducted interviews with each nominee and ultimately chose four CUSOs to be awarded for their cooperative efforts.
For 2022, the legacy CUSO of the Year Award was separated to honor two different CUSO models; one of which is a Contemporary CUSO Model and the other a Traditional CUSO Model. The additional awards for 2022 were for NEW CUSO of the Year as well as the CUSO of the Year –Distinguished Service Award that was introduced in 2021. See below for the Award Winning CUSOs of 2022:
CUSO of the Year – Contemporary CUSO Model: LenderClose
LenderClose has taken a very contemporary approach to raising capital, leveraging technology and managing their CUSO while having a significant and growing impact in helping credit unions serve their members’ mortgage needs. Focusing on and helping their client base led to automating the mortgage origination process so the system moves through the workflow automatically, and only notifies the loan officer if there is an issue or an exception! We also thought their Board Governance was impressive with the experienced and insightful leaders they have on their Board, challenging and encouraging Omar Jordan and the LenderClose team.
CUSO of the Year – Traditional CUSO Model: Prodigy
Prodigy’s story is inspiring, especially when you consider its humble beginnings. In the 1990’s an old core was going out of business and users had very limited options, so 9 small credit unions (each under $50 million in assets) decided to buy the source code out of the bankruptcy court and formed CU Data Processing. They hired some programming staff and ran their own core system so they could influence their own destiny. Prodigy has reinvented themselves by re-writing their core system, and again by adopting a fully cloud based model. Today they have 24 credit unions owners and 41 credit unions who use their core system, all of whom volunteered to an increase in pricing to support increased staffing at Prodigy, since Prodigy was saving each CU so much through automation. A wonderful example of collaboration and providing consistent value to their credit union partners
NEW CUSO of the Year Award: Zest AI
Zest AI has leveraged technology to help credit unions better serve their members by utilizing over 300 elements of non-traditional criteria when determining credit worthiness. Zest AI helps credit unions get more members while helping them approve 25% to 30% more members for loans. Each model is unique to each credit union and is essentially that CU’s model, so it helps them to be more efficient in their lending while helping to serve more members. Zest AI really impressed us with how they work so collaboratively with each of their 30 current credit union clients. In the last three years, Zest AI has delivered 121 models, helping to decision $5 billion in loans to 5 million members and delivering $1 billion in improved earnings from reduced credit losses!
Distinguished Service Award: Member Driven Technologies
This special award recognizes CUSOs who have provided substantial value and help to credit unions and their members over a long period of time. We believe that Member Driven Technologies falls into this unique group of industry leaders.Member Driven Technologies accomplishments are significant, including serving credit unions for nearly two decades and growing from the 7 founding credit unions to 120 credit unions, serving 2 million members with $20 billion in assets, all done by referrals from existing credit union owner/clients is amazing! We loved the collaboration MDT uses with their CEO Forum to help set priorities, and how they share the benefits of economies of scale with all MDT credit union clients is truly living the People Helping People vision of the credit union movement
Congratulations to all four of our award winners for 2022, and a sincere thank you for the continued forward movement of CUSOs and Credit Union services.
The tenth annual Next Big Idea Competition took place on Tuesday April 26, during the NACUSO Network Conference at Walt Disney World Resorts. Six finalists were chosen by a selection committee as they presented innovation and drive for advancements within the industry thus making it to the top six out of twenty-six competitors. It was a close competition with a voting difference of 2% separating winner and runner-up.
Ultimately claiming the winning title of the 2022 Next Big Idea Competition was Illuma Labs who presented on stage with Posh Technologies and received 29% of attendee votes. Illuma and Posh have partnered together to enable credit union members to securely access their accounts by voice recognition verification. This is a result of integrating the Illuma Shield™ passive voice authentication solution with conversational AI IVR from Posh.
Coming in close behind was QCash Financial who was named the runner-up of this year’s competition. QCash puts members first with their innovative, relationship-based lending platform that provides no credit check loans in under 60 seconds. The idea is to work with credit unions to advance financial inclusion through access to lending resources when members need it most.
In addition, this is the third year in which CO-OP Solutions sponsored the competition with a total prize pool offering of $10,000. Illuma Labs received $7,500 as the first-place winner of the competition and the remaining $2,500 was awarded to QCash Financial as the second-place winner.
Special recognition goes out to the additional four finalists: ChangEd CUSO, Dora, JUDI.AI, and Quilo. Additional coverage related to the competition and the NACUSO Network Conference will be released at nacuso.org in the coming weeks.
The 2023 Next Big Idea Competition will be held at the Encore Las Vegas Resort in April of next year, during the next NACUSO Network Conference.
Orlando, FL (April 26, 2022) –The National Association of Credit Union Services Organizations (NACUSO), announced the results of their 2022 Board Election in the Annual Membership Meeting on April 26, 2022 at the Disney Yacht & Beach Club Conference Center in Orlando, FL.
Each member of the NACUSO Board of Directors serves three-year terms and six terms expired in 2022. Of the six expired terms; four incumbents were re-elected and two newly elected directors joined the NACUSO Board as replacements for two members who did not run for re-election.
The two members who did not run for re-election were Jay Johnson, of Callahan & Associates, and Mike Hales, of CU Revest, LLC.
Filling the two open seats were newly elected directors: Seth Brickman, CEO of QCash Financial, and Mike Haggerty, President of CommunityAmerica CUSO & Copper Financial Network.
Four incumbent members were re-elected for additional three-year terms. This included our Board Chairman, Ray Crouse, CEO of Parsons Federal Credit Union, as well as the following three Directors:
Tom Davis, CEO of Trellance
Phil DuPree, Chief Revenue Officer of CU Direct
John Janclaes, CEO of NYMBUS CUSO
Jack Antonini, CEO of NACUSO said: “NACUSO is very fortunate for the service and dedication of each of our board members and is looking forward to the next three years with Seth Brickman and Mike Haggerty joining the four re-elected directors and the rest of our Board.”
In introducing a panel session discussion on crypto here, one person pointed out it had been deliberately named, while another observed that credit unions reporting their members aren’t asking for crypto-services, those members aren’t going to ask. They are just going to go elsewhere.
“The session is called ‘The Crypto Craze: Where and How Should CUs Get Started,” said Lou Grilli. “It’s how and when. Not if.”
Grilli, an innovation strategist with PSCU, served as moderator of the session during the NACUSO Network Conference here, where the four panelists all reinforced Grilli’s observation in different ways, emphasizing that every credit union should be well into its strategy for crypto by now—with one CU CEO further suggesting it’s not about the crypto at all.
From left, Becky Reed, John Ainsworth, John Wingate and John Ungerland at NACUSO Network.
Participating as panelists were Becky Reed, CEO of Lone Star Credit Union; John Wingate, CEO and founder of BankSocial John Ainsworth, CEO of Bonifi, and John Ungerland, CIO of DaLand CUSO.
Grilli, who said he’s been in payments for 20 years and “nothing I’ve worked with has been in the news cycle so frequently,” had the following questions for the panelists.
Grilli: As CEO of a credit union, your primary responsibility is to your members. Why is this in the best interests of members?
Reed: The first thing I think you should do as a credit union leader is look at your data. I think you will all be surprised to find out your members are already trading in crypto. We are just $165-million in assets, but in any given month we have about 100 transactions going out to Coinbase and other digital wallets. I don’t consider my membership any different than the rest of you.
My personal opinion is crypto is the shiny object. I don’t think crypto is what we need to be paying attention to as financial institutions. I believe the important part is how crypto moves on the blockchain. It’s going to revolutionize payments as we know it and also digital IDs. Soon, members will be demanding a safer way to be identifying themselves. It will no longer be about date of birth or Social Security numbers. All of those things are already out there in the universe. It’s really the blockchain we need to be paying attention to.
Wingate: I would even take it even further. When we looked at the primary regulatory framework for these decentralized, distributed networks, we saw credit unions as the analog defi. And we said we could take these decentralized distributed ledgers—you’re already doing defi (decentralized financial institution) but in analog way—we can digitize this and bring this concept of a credit union into the 21st century. It’s really a step above a revolution. It’s an evolution. Once we step through it I don’t see people stepping back. There is a huge opportunity to essentially revamp the credit union model ecosystem.
Lou Grilli
Ainsworth: The first term I will throw out is ADT– It’s about damn time. My first conversation on this was back in 2018. In 2019 we did our first use-case. So, here we are talking about should we get involved. The answer is a definitive yes. If you look at your balance sheet right now you’re going to see impacts in deposits. But you are also going to see it in interchange. Interchange is going to go away. There will be no interchange.
Ungerland: The answer to how to get involved in the crypto space is to understand that these networks are being discussed, that they are decentralized ways of storing data. Your institution is a natural analog to a decentralized way to house data. But why would you get involved? Why does it matter to your members? We aren’t in the early days of bitcoin and blockchain. We are in the early days of institutional adoption. We have to ask ourselves as FI leaders, are we in the late days of something else, like an electronic dollar and SWIFT system? Are your members interested in ways to safely store their data. Human beings will always look for secure and trustworthy places to store the fruits of their labor. A lot of them are already exploring it. It’s very plausible that the way to get involved as a credit union is that you can store and control that data on a core. Then you can be plugged into the future of your members by storing their wealth. Centralized systems are great for a time. We’ve lived through 50-60 years of a very powerful centralized banking system. But don’t put all your eggs in one basket. There comes a point in time when in communities it’s better to distribute out the data and the wealth and to store it in a different way.
Grilli: This is a completely new world. How do we stay compliant?
Wingate: It’s not as complex as one would think. We have been looking at solutions with Bonifi that we really love. You can reduce the compliance with self-sovereign identification solution. You were holding all this data in your systems. You are essentially saying, ‘Hey, I’m the door you need to come kick down.’ The idea is that you can still be fully compliant and still do full KYC and AML and you don’t have to layer on these significant costs that exist today. I would say that it is actually as big a barrier as most people make it out to be. The other thing is with these decentralized platforms the focus should be on how to you get revenue out of it, reduce risk and liability and create a great member experience. That should be the paramount questions with any new technology.
Wingate: PayPal is a digital currency if you think about it. A Starbucks card is stored value. They are just 1’s and 0’s. You are already in it. If we are the one to legitimize it, what a great state.
Ungerland: When we talk about regulation, please bear in mind that as local, decentralized FI, you are this natural fit for these networks that are being built out because people aren’t trust in centralized institutions. These give you a way to plug in. From a regulatory perspective you have a very important part to play in this. You have to get vocal about this space. Absent your local institutions advocating for the value of local decentralized money, you can pretty much rest assured the trend will be toward a hyper-centralized form of this technology, like a central bank digital currency. Members are going to be in direct-to-Fed relationships. That’s why it is crucial.
Grilli: Fraudsters love crypto currency. How do you provide security?
Reed: it doesn’t have to be complicated. At my credit union we had to get together and say, ‘OK, members are buying and selling crypto today and all of them are exposed to fraud in some way. All of them have bad guys coming after them. Those things we are required to report.’
So, where does crypto come into that if members are being taken advantage of by bad guys? Crypto was originally used by bad guys trying to circumvent the traditional financial institution. How can we be compliant with AML/BSA? It’s really about looking at your data. If something doesn’t look right, it’s probably something you should be reporting. Right now, there are not a lot of fraud mitigation tools out there to protect consumers.
Grilli: You stated crypto is the payment of the future.
Reed: Again, it’s not the crypto, its blockchain. At the end of the day the U.S. dollar is just a stablecoin. This is going to be so disruptive in our space. It’s about creating a completely new type of financial institution in which the foundation is something different than analog. We have to pay attention to this. It is going to disrupt traditional ways of doing things.
Wingate: Is it much easier to track blockchain transactions once you know what you’re doing. You have to start looking at the ability to provide not just security but the ability for people to trade value in a secure and trusted way in real time. The Lightning Network can transfer 50x what Visa and Mastercard can do right now. When you take all these things into consideration, there is no case against it not being the pay rails of the future.
Ungerland: Crypto is already larger than the entire credit union industry. That’s another good reason to get plugged in and educated about this stuff. (Ungerland shared one person’s observation) “There is more risk in 180,000 seconds than there is in 3 seconds.’ That’s the two to three days.
Grilli: What does custodial mean? Digital assets all need a digital wallet to store them. NCUA has provided some guidance and said credit unions are not allowed to be custodians of digital assets yet. What is your take on custody and should CUs be involved?
Wingate: When we started looking into this and had some discussions and it didn’t sound like it was so much about the custody of crypto. It was, ‘Can I hold it on your balance sheet?’ The answer is no. So, in the question of custody or non-custody, is the risk worth the reward? I personally don’t think so. I think there are other ways to monetize the ecosystem. The last thing you want is to be a credit union where you are one of the first ones to have a big hack. I’m not a big fan of giving my crypto to be held by someone else.
Ainsworth: You can store assets like diamonds in the safe deposit box. You are the custodian, but that is not on your balance sheet. With the safe deposit box, it’s not easy to get in unless you have both keys. The access to the wallets is where the risk is, and there’s no recourse. So, the importance is we’re protecting you. You have to know the parties on both sides. You may know one party, but can you validate the other with assurance?
Ungerland: I don’t disagree. Right now in this space consumers have two options. They can use an online exchange or a distributed software wallet or a hardware wallet, and if lose that, you lose all crypto. I’m a big believer that in the future there is going to be a wealth of opportunity for local financial institutions.
Grilli: Can you share your takeaways?
Reed: I think that when you understand something complex and are able to understand something in simple way, you truly understand. As credit unions and CUSOs, educate yourself. Understand what’s happening at your own credit union with what your members are doing. Pay attention. It’s not just the bright shiny object that is crypto.
Wingate: Be intentional and educate. Lean on people who have the ability to break it down and provide meaning to you. That’s how you get into it successfully.
Ainsworth: I hear credit unions say, ‘My members aren’t asking for it.’ They aren’t going to ask you. You are going to see it in their behavior. We talk about inclusion—that demographic is the most active in this space.
Ungerland: My eight-year-old son has no money in the credit union. All his money is in crypto. You want to know who you should be serving? You need to be serving him, those people holding capital outside your institution.
