Claiming a free speech right, a Los Angeles credit union said Thursday for the moment it is keeping a controversial safety/soundness ad on its Web site despite an NCUA request to pull it down.
"We are consulting legal counsel but right now the 'Insider' ad remains on the web because it seems the NCUA is taking on the role of press censor," declared Stuart Perlitsh, president/CEO of the $250 million Glendale Area Schools FCU.
The CU Web site reprints a Bauer Financial rating mention on Bankrate.com titled, "How Safe Is Your Money?" showing favorable comparison stats of Glendale Area CU against other California banks, CUs and a savings & loan.
In a Feb, 12 letter to Perlitsh, NCUA Region V Director Melinda Love asked the CU to "remove this advertisement from your Web site as soon as possible" in line with an Oct. 2 warning by NCUA Chairman Michael Fryzel that CUs refrain from ads implying that "banks are not safe" thereby steering business to CUs.
Perlitsh contends a "turf war" exists in the Los Angeles market suggesting competitor CUs had apparently alerted NCUA to the Bauer mention on the Glendale Web site.
In her letter, Love said the Bauer citation "has come to our attention" noting that the ad breaks down Bauer recommendations into "five star and four star institutions." Such designations "implies that money is not safe unless it is deposited at financial institutions such as your credit union with a four star rating or higher." In her letter, Love also suggested the word "bank failure" scrawled on the copy is a topic of concern.
Asked about the Perlitsh stance, an NCUA spokeswoman in Washington declined immediate comment but said the matter "is under review."
