Finding the schedule to conduct a quarterly or annual riskmanagement review proved to be a time crunch for CP Federal CreditUnion.

The $323 million credit union in Jackson, Mich., knew that itwas not alone in scheduling the reviews, and it was the impetusbehind the debut of CU Rx, a risk management and compliance CUSO.The new entity was formed through CP FCU's subsidiary, CP FinancialServices LLC.

CU Rx will offer review and audit services with solutions toimprove risk management, fraud, compliance and regulatory bestpractices. After conducting the review and audit for a creditunion, CU Rx said the output from the analysis aims to produce arisk matrix exposing the client's vulnerabilities and areas ofnoncompliance. The CUSO staff then evaluates the credit union'sexisting policies and controls from the identified risks, andspecifically seeks evidence of control weaknesses. The finalrecommendation includes strategies and tactics for improving thosepolicies, procedures and controls.

According to CU Rx, training is also offered to ensure thecredit union's staff understands compliance on specific regulationsand best practices, and to avoid the risks or issues that surfacedin the review process.

“We know from personal experience it's difficult for creditunion executives to find the time necessary to go through theprocess of a quarterly or annual risk management review process,”said CU Rx President John Crist, who also serves as president/CEOof CP FCU.

Crist said the launch of CU Rx is timely given the regulatorylandscape for credit unions.

“It's no secret that keeping up with new regulations or changesis a tough chore, but it's critical for the protection and healthof any credit union's reputation and operational success,” hesaid.

Most credit unions currently hire legal firms or accounting firmauditors to complete audits, Crist said.

“CU Rx was created to fill a serious need in the industry, whilehelping credit unions mitigate risk and improve compliance,” Cristsaid. “It's proven to be a cost- effective solution for ourexisting clients. They appreciate the high level of care CU Rxprovides. Not to mention the time savings and relief one feels toget control of regulatory risk and compliance issues.”

Among the regulatory topics the CUSO is asked to review the mostare the Bank Secrecy Act, USA Patriot Act, automated clearing houseaudit, identity theft red flag rules, disaster recovery, vendormanagement, and third-party due diligence, said Bryanna Tapley, CURx vice president. Reviews of Regulation E and Section 748 of theNCUA's rules and regulations are also common request, sheadded.

“Training credit union staff on regulations becomes particularlyhelpful for the long-term effectiveness of the CU Rx audit process.It's not just a list of solutions and we're gone,” Tapley said. “CURx works through the client's customized plan to see that risk,fraud and compliance weaknesses are resolved. It's a proactive stepthey must take for the long-term health of their credit union.”

After the establishment of CP Financial Services in 2005, theneed for consistent, expert risk management and compliance amongcredit unions nationwide became apparent, according to the creditunion. Over time, Crist and Tapley said they recognized they hadthe nucleus of a risk management and compliance CUSO.

“The tools and experienced staff were already delivering riskmanagement and compliance solutions for area credit unions. As aCUSO, they intrinsically understood a credit union's needs,operations and opportunities, including the need for cost-effectiveand fast delivery of tailored risk, fraud and compliancesolutions,” Crist said.

Showing credit unions how to adapt and comply is one of CU Rx'sgoals, said Chrissy Siders, vice president of operations at CURx.