News & Highlights

NACUSO Spotlight on Scott Collins, President of Xtend

Each month we are highlighting at least one NACUSO member by interviewing one of their executives. The format is meant to be fun and informative. This month we are excited to share the story of Xtend. Enjoy!

PART ONE: Life Story and Experiences

What’s your current position and can you give me a brief overview of what it is you do in your work?

xtend_fancy1I am the President of Xtend, a multi-owned CUSO headquartered in Grand Rapids, Michigan.  Xtend’s core business is providing shared resources to credit unions and developing relationships with industry partners that are looking to expand their markets in the mid-market space.  As the senior executive, my responsibilities are centered on developing and driving our vision, providing mentorship to my staff and ensuring the Board of Directors and Management are in synch tactically and strategically.

What would you say most motivates you to do what you do? What are you most excited or passionate about?

We started our CUSO 14 years ago by tossing $60K into a hat with a goal to build something special that could help credit unions survive, and even thrive in a consolidating market.  Now that we are a successful company approaching 75 employees, I am motivated by two things:  looking for that next disruptive innovation that we can bring to our mid-market customer-owners, and leading a group of credit union professionals, a significant number being millennials, to work on the business plans of those customer-owners.

It might sound a bit Pollyanna-ish, but having the opportunity to work with credit union professionals on a daily basis, both internally and externally, and wearing a bunch of hats in the process – mentor, peer, business partner and friend – keeps me motivated on the business side.  On the personal side, spending time with my family (wife of 29 years and three sons in college) and friends when everyone’s busy lives afford us that opportunity, are moments I cherish.  Time spent golfing, fishing, hunting and camping top that list.

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The CFPB, Credit Unions and Fines

imageThe CFPB fined Navy Federal Credit Union $5.5 Million as a civil penalty for violations related to collection efforts and $23 million as compensation to members who were subject to collection efforts that were allegedly contrary to applicable regulations.   This got me to thinking, what is the purpose of CFPB fines?

Some would argue that the fines are a form of punishment.  “Make the bastards pay.”  The sentiment was widespread among many Americans after the financial meltdown when no one was held accountable.  I have to admit that the notion has some emotional appeal to me.  There are people who were bad actors and designed business models that preyed upon the public and deserve to face at least a fine for their egregious conduct.   However, I do not see Navy Federal Credit Union as a predatory institution that needs a dose of vigilante justice.   Navy has the heart and soul of a true credit union that cares deeply about the financial well being of its members.   Navy Federal Credit Union did not cause the last financial melt down and will not cause the next financial melt down.  They will never be on the “get-even” list.

Some would argue that fines are a deterrent to financial service providers to not repeat bad behavior.   The theory goes that if a bank is fined, that will cut into the profits and upset the shareholders who will take up their pitchforks and make the board and management behave better.   Even if you accept this reasoning, I don’t see how that theory applies to a credit union.   The irony of the Navy fine is that in its zeal to protect the members of Navy Federal Credit Union, the CFPB is taking money from the very members it says it is protecting.   All the money in credit unions belongs to the members.  There are no profits going to “fat cats.”  So if you fine a credit union, it is the members who pay.

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The CFPB and My Fifth Grade Government Class – by Guy Messick

schoolhouse-clipartIn my fifth grade, I learned about checks and balances in our democracy.   This country was founded on the then revolutionary principle that the people are free and the people grant their government with limited rights for limited purposes.  The fear of an overreaching government is why our founders created a government with multiple checks and balances; to prevent a branch of government from making up rules without the input and consent of the people and their representatives.   When Congress created the CFPB, they forgot those concepts.

The CFPB is run by a single administrator who is appointed to a five year term and answers to no one.  The current administrator was never confirmed by Congress.  The CFPB funding comes from the Treasury Department not from the Congress.   The people’s representatives have no supervisory powers over the CFPB, an agency that Congress created to pass rules consistent with the authority granted by Congress.  Unfortunately Congress was a bit vague with the grant of authority. The CFPB exploited that vagueness to give itself the power to regulate conduct in every type of consumer financial service.  Congress gave the CFPB the keys the car and an unlimited credit card and like an entitled teenager, the CFPB is driving anywhere it wants to go.

Other financial regulators pass regulations that are first offered for public comment and then published as final regulations so that the financial institutions understand the “rules of the road” and can act accordingly.   The CFPB makes many of their new rules by ambush.   They and they alone decide among themselves what is fair and not fair.   They then give notice to a financial service provider that they are acting in a manner they determined is unfair to the consumer.   Through litigation and the mere threat of litigation, new standards of conduct are imposed.  If their new rules impose higher costs on a financial service provider that drive up the costs to consumers or adversely impact the financial integrity of a financial services provider, they do not care as they are “on the side of the angels” and will impose their view of the world on all of us no matter what the costs or consequences.

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I Want a Financial Fitbit!

Four years ago, for my husband’s 50th birthday I bought “us” the Up by Jawbone. It was a primitive Fitbit. A black band with a cap that revealed a stick you put into your iPhone to upload your data. You had to “check in” so it could judge you. It tracked your activity, your sleep patterns fairly well, you had to upload your eating so it could judge you more. It was ugly, and clunky and it had this annoying habit of vibrating when you were idle for too long. After about 2 months I ripped it off my wrist and tossed it in a drawer. My husband stayed with it. After about 6 months his first one died, and he bought another, only to have that also die outside of warranty and by the third time (three strikes and you’re out) he gave UP. Get it?

fitbit-earningsSo for Christmas last year I bought him the Fitbit – because it was the highest rated on Amazon and I got free shipping (Amazon Prime). I didn’t really know much about it. He’s a gadget guy, so anything that gives him charts and graphs and feedback is great. The Up never made him smile. He was always answering to it, and trying to coax it back to life.

Soon after he got the Fitbit he would say things like “I just got my Empire State Building badge for climbing a bazillion flights of stairs!” (The Fitbit was giving him “awards”) – hey, whatever floats your boat, right?

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We Found the CU*Answer to the Dwindling Number of Credit Unions

question

Credit unions. Not for profit, financial cooperatives owned and operated by their members. The start up stories of this 107 year-old movement are heartwarming:

Credit Union ONE began in 1938 when 15 neighbors organized the Ferndale Co-Op Credit union in a local church basement, pooling $158 and their shared commitment to “people helping people.”

TAPCO Credit Union was founded in 1934 by nine employees of the City of Tacoma. Our first branch was located under the stairs of the Old City Hall in downtown Tacoma.

TOPCU was established by City Firefighters and Chief John “Slatz” Freeman in 1935. The original branch was Fire Station One, the hours were “Whenever there isn’t a fire.” It began with 19 members and $30.75 in assets.

The original model was quite simple. Built on trust, usually involving money in a shoe box or cigar box. Ledgers kept track of deposits and loans. Our first real regulation didn’t come down until 1968, The Truth in Lending Act. Credit unions were not allowed to offer share draft (checking accounts) until the late 70’s. And that’s when things started to get more complicated.

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Wells Fargo and a Culture Out of Control by NACUSO CEO Jack Antonini

When I first heard the news that Wells Fargo employees fraudulently opened two million unauthorized or fictitious customer accounts in an effort to meet sales goals, I could hardly believe that such a fraud could occur.  Then as I learned that this happened over a period of several years, dating back to at least 2011 and that Wells Fargo continued to pressure employees to “cross-sell” (i.e. open new accounts), even after they became aware of these egregious acts, I was outraged.

stumpfAt the Senate Banking Committee hearing this week, The Wall Street Journal reported that Senators “accused [Wells Fargo CEO] John Stumpf of fostering a culture where low-paid branch employees were pressured to meet impossible sales quotas to keep their jobs, and so signed up customers for products without their knowledge. As the employees sold more products, Wells Fargo shares rose and bigger bonuses flowed in for the top executives.”

How could this happen?  In a well written article on “How Wells Fargo’s High Pressure Sales Culture Spiraled Out Of Control” the WSJ summarized it this way: “Hourly targets, fear of being fired and attractive bonuses kept employees ‘selling’ even when the bank began cracking down on abuses.”  The article went on to say: “For five years, Wells Fargo conducted investigations into improper practices, hired consultants and tinkered with sales and compensation incentives. Questionable sales tactics persisted, though, and were an open secret in Wells Fargo branches across the country … branch managers routinely monitored employees’ progress toward meeting sales goals, sometimes hourly, and sales numbers at the branch level were reported to higher-ranking managers as many as seven times a day. Tension about how to meet the sales targets was common. Former employees reported that managers asked employees who had fallen short of the targets if they could open accounts for their mother, siblings or friends.”

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The Essential Truths of Back Office Collaborations by Guy Messick

collaborate-image

I learned a few things along the way about credit union collaborations that jointly supply back-office operational services, e.g. IT support, lending, collections, compliance; etc.   Below are some common lessons learned.

  1. Scale alone is not enough. If two credit unions merge or two credit unions collaborate through a CUSO there will be an increased scale in the operation. But if there are no other changes and the credit unions continue to operate in the same manner with the same number of people, there are no savings other than perhaps through additional bargaining power with vendors.    If the processes and people issues are not addressed, a merger of credit unions or a CUSO collaboration can actually add costs.

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Advocacy Updates

Report on Advocacy Fund spending… NACUSO Working for You

Through the support of our members and partners, NACUSO raised approximately $273,000 in contributions toward its Advocacy Fund (and predecessor Legal & Litigation Fund) over the past 3 years.  The goal of the two funds together are to enable NACUSO to conduct crucial advocacy work on behalf of CUSOs and their credit union owners / partners.

In keeping with our commitment to be fully transparent and to regularly communicate our usage of these dollars (we provided detail of how the funds were spent from 2014-2015 last year, which is also included in the attached Report), we would like to provide you with the following information, which was provided in detail to each contributor in the first quarter of 2017.  NACUSO spent the following amounts from the Advocacy funds during 2016:

$24,000     Dollar Associates, LLC - paid for advocacy work with Congress and NCUA on CUSO issues
$24,000     Messick & Lauer, P.C. - paid for advocacy work with NCUA and meetings with Congress on CUSO issues
$   718     Travel to Washington DC for meetings with Congress and NCUA
$48,718    Total amount spent influencing Congress and NCUA for favorable CUSO environment

The remaining funds, out of the total $273,000 in combined contributions, equal $110,323.  This represents the balance in Restricted Cash as of 12-31-16, as per the NACUSO Advocacy and Legal Fund Analysis report (click link below).

The NACUSO Board and its Legislative & Regulatory Advocacy Committee is continuing to prioritize the advocacy of a regulatory environment that is pro-CUSO and pro-collaboration within our industry.  NACUSO needs your support for this initiative and to accomplish its purposes.  While strategies may change over time based upon circumstances and opportunities to advance the cause of CUSOs, the necessity for funding of such initiatives is essential if NACUSO is going to remain in a position to impact the decision-making process for CUSOs and the credit unions that invest in, or utilize them.

Click to Contribute

For a summary of how NACUSO has worked to maintain an environment that is supportive of collaborative investment, the following report entitled NACUSO Working For You (see below) provides a summary of the work we have done on your behalf.  To capsulize some of its key points, a summary of what we feel are the NACUSO “wins” this past year are:

  • Effectively opposing the costly extension of Vendor Authority to NCUA.
  • Worked with NCUA on the revised MBL Rule.
  • Advocating for the expansion of CUSO powers to originate loans credit unions are authorized to make, to help bring scale and expertise benefits to credit unions in all loan categories.
  • Encouraged NCUA to be transparent in its budget and rule making including the OTR calculation.
  • Working with NCUA to minimize adverse impact of the CUSO Registry and to correct the acknowledgements initially in the Registry.

To emphasize the last bullet above, initially, in its first version of the CUSO Registry documentation that CUSOs were required to submit with their data to NCUA in 2016, the agency’s acknowledgement form required CUSOs – when submitting their data – to accept responsibility under regulations that only apply to credit unions but were not intended to, apply to CUSOs.  These acknowledgments, if left unchallenged and signed by CUSO officials, could have exposed CUSOs to potential penalties under regulations that do not, and were never intended to apply to CUSOs.  Upon becoming aware of this inappropriate acknowledgement requirement, NACUSO worked directly with senior NCUA staff to bring our concerns to their attention.  NCUA agreed to the NACUSO position and made the needed changes to the acknowledgements for the CUSO Registry data submission process.  In addition, for those CUSOs who had already submitted their registration and signed the acknowledgements, NACUSO developed a letter with the appropriate wording for those CUSOs to send to NCUA to clarify this acknowledgement concern.

Effective advocacy requires ongoing diligence in following every aspect of regulatory requirements impacting CUSOs and the credit unions that invest in them and benefit from them.  It necessitates prompt response at times and the ongoing resources to interact positively on behalf of the CUSO community on issues and requirements of all types.  With a new Congress now in session, educating them on the benefits of credit unions and the collaborations that enable them to cost effectively serve their members, as well as invest in innovation, through CUSOs that help spread and minimize risk, is an important message we are delivering.  We hope that you agree such diligent advocacy initiatives are crucial to the long-term viability of the collaborative movements within the credit union community.

We hope this report helps you see how we have carefully managed the funds entrusted to us, for Advocacy purposes.  We would be happy to answer any questions that you may have.  Thank you for your support, and for giving NACUSO the opportunity to support you as you serve your members.  Please consider adding your support to our advocacy efforts by contributing today.

View NACUSO’s 2016-17 Advocacy Plan 

View NACUSO’s Advocacy & Legal Fund Analysis

 

Best Regards,

Jack M. Antonini
President & CEO
NACUSO
Jack@nacuso.org

NACUSO Working For You

Legislative & Regulatory Advocacy Update

Vendor Authority

Knowing that obtaining vendor authority was the number one legislative issue for NCUA in 2015-16, Jack Antonini and Guy Messick met with key Congressional representatives in January to tell Congress why credit unions and CUSOs oppose the extension of this expansive, costly and unnecessary authority to NCUA.  When NCUA made their official request for vendor authority, Congress was not persuaded by their arguments.

We continue to monitor the situation to ensure that the Senate and House recognize that such an unwarranted extension of regulatory and examination authority beyond the current statutory mandate of NCUA is both controversial in the industry and potentially damaging to an industry that is dependent upon third party relationships because of their smaller size in comparison to many of their competitors.  Credit unions need third party support and collaborative innovation to continue to effectively meet their members’ needs, and a burdensome regulatory and examination regime for anyone who does business with a credit union will not foster that support and innovation.

NACUSO is focused on protecting credit union collaboration through CUSOs, but we need your help, so we can continue to be vigilant in monitoring legislation in Congress, please contribute to NACUSO’s Advocacy Fund today – click here to contribute.

NCUA’s MBL Rule

NACUSO was supportive of the positive changes in NCUA’s revised MBL Rule, including the greater authority to waive personal guarantees, a more balanced approach to construction loan limitations, enhanced flexibility on counting loan participations against the MBL cap and the improved treatment of 1-4 dwelling rental property.  NACUSO also, in consultation with our business lending CUSO members, recognized that the Conflict of Interest provisions in the new MBL Rule could be misconstrued by examiners, so we have engaged with NCUA Board members and senior NCUA staff about the issue, and sent a letter to explain our concern and our recommended solution (see NACUSO’s MBL Conflict of Interest Letter to NCUA ).

Expansion of CUSO Authorized Powers

NACUSO wrote to the NCUA Board in 2015 requesting an amendment to NCUA Regulations Part 712.5 to add to the list of authorized CUSO powers to help facilitate a competitive solution to the growing Internet and peer-to-peer lending competitors for car loans and unsecured loans faced by credit unions in today’s environment (see NACUSO’s letter).  Chairman Matz responded that she was not opposed to reconsidering new authorities for CUSOs, indicating “if CUSOs can legally provide additional services to benefit credit unions and their members without compromising safety and soundness, I would strongly support those efforts.”  Chairman Matz went on to say that she had asked NCUA staff to review the policy and safety and soundness considerations relative to our request, and this review is already underway (see Chairman Matz response).

NACUSO has since asked the NCUA Board to consider updating the CUSO powers to align CUSO loan support with the loans credit unions are authorized to provide to their members  (see NACUSO’s 2017 Expansion of CUSO Authorized Powers Letter to NCUA), so CUSOs can bring scale, risk mitigation and expertise benefits to credit unions in all loan categories, not just those listed in the regulations.  While we explained the reasons for updating the NCUA Rules and Regulations Part 712.5 defining the permissible pre-approved activities a CUSO may provide, we also referred to our advocacy efforts to have auto loans and consumer loans added to the list of CUSO activities over the past two years, and the support that NCUA has communicated regarding those efforts.  We respectfully submit that now is the time to update the CUSO regulations to clarify that CUSOs are authorized to assist credit unions with any loan type that credit unions are authorized to make.

Update on CUSO Rule Implementation

Pursuant to the CUSO Rule the NCUA adopted in November 2013, CUSOs have been required to report certain information directly to NCUA pursuant to the agreement with their investing credit unions.  NCUA built an on-line reporting system that went live in the first quarter of 2016, and CUSOs updated their CUSO Registry information in the first quarter of 2017.

NACUSO continues to work with regulators minimize the regulatory burden on CUSOs and to help credit unions realize the maximum benefit from collaboration through CUSOs.  We work to ensure regulations affecting credit unions and CUSOs are as favorable as possible, but we need your help to continue this regulatory advocacy work, please contribute to the NACUSO Advocacy Fund today.

NACUSO Supported Transparency on OTR

NACUSO has long expressed its concern about the growth of NCUA and its extension of its regulatory arm, both directly and indirectly, into areas of questionable statutory authority such as the de facto regulation and examination of CUSOs through the 2013 CUSO Rule.  The extension of regulatory authority by NCUA comes with increased costs, costs that are paid for ultimately by credit union members.

NCUA takes money from the insurance fund to pay for its operations through the Overhead Transfer Rate (“OTR”).  The OTR currently funds approximately 70% of NCUA’s budget.  NCUA does not have to justify its expenses or ask permission from anyone to take as much money as it deems appropriate from the share insurance fund for its operations.  Fortunately, under new leadership, NCUA has decided to be more transparent as part of its budget process and publish details of how it calculates the OTR.

NACUSO 2016-17 Legislative & Regulatory Advocacy Plan

As we explained when we announced the formation of the NACUSO Advocacy Fund two years ago, the regulatory climate that enabled credit unions to maximize the benefits of CUSOs and collaboration is under siege, and as an industry, we need to respond.  NACUSO established an Advocacy Fund to supplement its efforts to promote and protect a collaboration/CUSO friendly regulatory climate.

At the 2016 NACUSO Annual Conference, we shared our 2016-17 NACUSO Advocacy Plan, based upon the four basic precepts upon which our advocacy work is based.  Those four pillars are designed to support an environment that:

  • Encourages credit unions to deliver a better member experience and improve the financial well-being of members
  • Encourages credit unions to seek new collaborative ways to serve members needs
  • Rewards investment in innovation and collaboration
  • Supports the use of CUSOs as the incubators for collaboration and innovation so that credit unions can reap the benefits of entrepreneurialism without direct risks

The Advocacy Plan also identifies the key associational positions that NACUSO is focused on, for the benefit of CUSOs and their credit union owners, which are summarized as follows:

  • Supports the development of clear examination guidelines that recognizes that NCUA has review powers and not examination powers over CUSOs. Such guidelines would inhibit de facto regulatory creep that would treat CUSOs as regulated entities that would discourage innovation and collaboration. NACUSO will intervene with NCUA in the more egregious cases if the CUSO or the investing credit unions request NACUSO’s assistance.  NACUSO opposes any legislative efforts by NCUA to gain statutory authority to directly regulate and examine CUSOs through an unnecessary expansion of the agency’s examination authority over credit union vendors
  • NACUSO supports the modernization of the permitted CUSO Services list to include all loan types that credit unions can originate to help bring scale benefits as well as risk mitigation and expertise benefits to credit unions
  • NACUSO will encourage regulators to view innovation and collaboration as an essential part of a revitalized credit union model and adapt their regulations and supervision to encourage the responsible and prudent development of the collaborative model

Key strategies for accomplishing the NACUSO 2016-17 Legislative and Regulatory Advocacy Plan are detailed in the Advocacy Plan.  In order to have a maximum impact upon the regulators and the industry, CUSOs and their credit union owners must stand united as we promote the unique collaborative opportunities and risk sharing benefits that our CUSOs provide.   Together, our participation in collaboration advocacy efforts through NACUSO will be our most effective way of impacting the future regulatory environment under which CUSOs operate.

NACUSO will focus its advocacy efforts on those issues most critical to the CUSO community as a whole and will attempt to avoid watering down its message on key issues by taking public positions on all issues that may impact CUSOs or credit unions in a more indirect manner.

In the current environment it has become increasingly important for credit unions to find new sources of non-interest income in order to enhance earnings, build capital, and support member growth.  Thus, collaboration and innovation are more critical now than ever before to create sustainability for the credit union movement.  NACUSO educates the industry as a whole (CUSOs, credit unions and other providers) on the benefits of collaboration and innovation, facilitates cooperative business opportunities, and provides leadership on how to implement these strategies within a favorable legislative and regulatory environment.

It is the desire of NACUSO to be recognized as an effective organization in support of building a favorable legislative and regulatory environment through what we consider the four pillars of future credit union success – collaboration, innovation, growth and entrepreneurship.  NACUSO will be balanced in approach, but bold in action to aggressively promote this agenda and will seek to join with other like-minded organizations, when appropriate, to work in collaboration with NACUSO to see these key agenda items accomplished.

All of the organizations associated with the NACUSO Board of Directors have already made contributions to the NACUSO Advocacy Fund.   We urge you to add your collaborative voice to NACUSO’s advocacy efforts.  Please complete the commitment form today, and send your contributions to NACUSO so we can help you.  Please share with your friends in the industry who want to ensure a bright innovative, collaborative future for our industry and our members.  If you or your industry friends are not yet members of NACUSO, now is the time to join, and be part of the collaborative solution.  If you have questions about the NACUSO Advocacy Fund, click the link to go to the NACUSOAdvocacy Fund FAQ’s.

Thank you very much for your support, and for giving NACUSO the opportunity to serve you as you serve your members.  It is a privilege that we truly appreciate.

Sincerely,

Jack M. Antonini
President & CEO
NACUSO
Jack@nacuso.org

Jack M Antonini
President & CEO – NACUSO
jantonini@aol.com  (713) 208-0989
NACUSO’s 2018 Network Conference April 16-19 at Disneyland Resort in Anaheim, CA
Learn more about NACUSO in this short video!


NCUA Meeting Provides CUSO Guidance 6/16/16

NACUSO Visits NCUA to Discuss the CUSO Registry and CUSO Reviews

On June 14, Jack Antonini, NACUSO President and Guy Messick, NACUSO General Counsel met with NCUA Staff on the results of the CUSO Registry and the thinking on how CUSO Reviews will be handled.

The CUSO Registry sign-up period and the follow-up by NCUA found there were approximately 900 CUSOs.   NCUA believes that there are more CUSOs that have not reported.  Under the NCUA Regulations (Part 712.1(d)), “A CUSO also includes an entity in which a CUSO has an ownership interest of any amount, if that entity is engaged primarily in providing products or services to credit unions or credit union members.”   So these subsidiary CUSOs are considered CUSOs and required to make annual reports to NCUA.   The NCUA staff believes that many CUSOs were not fully aware of this requirement and there are a number of subsidiary CUSOs that have not reported.   NCUA will be following up with CUSOs to obtain these filings.   NCUA is also scrubbing the data and asking for clarification if the data is indicating that there may have been a reporting error. (more…)

Report on Advocacy Fund spending…NACUSO Working for you

Through the support of our partners, NACUSO raised approximately $63,000 in contributions toward its Legal and Litigation Fund in 2014 with a primary purpose to develop strategies for the most effective way to seek the repeal and/or mitigation of the impact of the CUSO Rule that NCUA had adopted in November 2013.  Subsequently, NACUSO established an Advocacy Fund to supplement the Legal and Litigation Fund.  The goal of the two funds together were to enable NACUSO to coordinate legal decision making, with a crucial advocacy component that will have more impact than the always risky option of legal action.  In total, $190,600 was contributed to the NACUSO Advocacy Fund.  Combined these two related initiatives received total contributions from NACUSO partners of approximately $253,600 in 2014 and 2015.

In keeping with our commitment to be fully transparent and to regularly communicate our usage of these dollars, we would like to provide you with the following information.  NACUSO spent the following amounts from the two funds during 2014 and 2015:

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CUSO Registry Clean Up Period 4/22/16

As most of you know, all CUSOs are obligated under the NCUA Regulations to register certain information directly with NCUA on an annual basis.   Over 800 CUSOs did so in February and March.   NCUA is now in the process of making sure all CUSOs have registered.   Their new deadline is April 30.  They are taking CUSO information from the credit union 5300 call reports and sending out letters reminding “CUSOs” that they have to register.   Some credit unions may have incorrectly listed a company as a CUSO.  Other credit unions list their CUSO but use an acronym for the CUSO instead of the CUSO’s full name.   NCUA, not knowing better is sending letters to any and all companies listed on the call reports. (more…)

Regulatory Update 3/15/16

Letter to NCUA regarding CUSO Registry Acknowledgement: Yesterday, NACUSO informed you of a change we negotiated with our General Counsel (Messick & Lauer) with the NCUA regarding the CUSO Registry Acknowledgment each CUSO is required to agree to when submitting their CUSO registration in the NCUA’s CUSO Registry system.  As we pointed out in our Regulatory Alert yesterday, the acknowledgment required CUSOs to agree to be bound by statutes that only apply to credit unions and which imposed penalties that are not applicable to CUSOs.

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Change to the CUSO Registry Acknowledgement 3/14/16

During the process of assisting with CUSO Registry questions, it came to our attention that in order to complete the CUSO Registry, CUSOs were required to agree to be bound by statutes that apply to credit unions and which imposed penalties that are not applicable to a CUSO.  On behalf of NACUSO and the many CUSOs in this industry, Messick & Lauer (NACUSO’s General Counsel) have advocated and negotiated to revise this acknowledgement to more accurately describe the duty of CUSOs to respond to the CUSO Registry.  It is a contractual duty with the credit union and not a direct regulatory obligation to NCUA.   As NCUA continues to pay more attention to CUSOs, NACUSO will continue to take action to be the voice of CUSOs and to resist any attempts at regulatory overreach.  The NCUA has changed the acknowledgement text.  For your reference, the text of the previous and current CUSO Registry acknowledgments are below. (more…)

Regulatory Update 2/26/16

NCUA’s CUSO Registry Training & Demonstration webinar held on February 11 is now available to be viewed.  If you missed the webinar, or want to view it again, to help you in completing the CUSO Registry, you can watch it by clicking on the following link:  View 2/11/16 Webinar. You have until March 31, 2016 to complete your initial registration of all CUSOs.