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<p>Did you hear that earlier this year a long time credit union CEO resigned and joined a large bank taking with him most of the credit union’s loan portfolio and his entire management staff causing the credit union to end up in dire straights? After he left, it eventually came out that he had had a torrid love affair with the daughter of the bank’s CEO. She’s pregnant and upon learning this, his wife left him for the mailman. Credit union people everywhere are wondering how such a thing could happen. Well keep wondering because it didn’t happen. This is nothing but a preposterous and fictitious story completely fabricated by me to make a point regarding credit unions and the rumor mill. The credit union industry has a terrific track record. It is superior at so many things, but unfortunately this includes being home to the biggest rumor mill on this planet. It never ceases to amaze me how fast “news” travels among credit unions and the organizations that serve them. The juicier the tidbit, the faster it moves across the country. Did you hear who just got fired and why? Did you hear who is expected to be named a member of the NCUA Board and why? Did you hear who resigned with no notice and why? Rumors are not unique to credit unions, but because the credit union industry is in reality a relatively small and close knit group, rumors about the people and organizations that operate within it travel with lightening speed. This could all be considered good clean fun except many credit union related rumors are downright ugly. They have ruined reputations and careers. They have resulted in outstanding credit union CEOs being virtually black listed from future employment in the credit union industry. They have caused career employees to get fired based on rumors that they were secretly seeking employment elsewhere. They have caused life-long friendships to dissolve. They have also caused rock-solid vendors to lose credibility and worse, sales. They have caused lawyers to get involved where none were needed. They have caused the unraveling of mergers that made sense until the so-called real motives for the proposed action were uncovered. I personally know a dozen or more former credit union CEOs who have never been able to get back into credit unions because they left their previous positions surrounded by rumors, rumors like these: The numbers weren’t looking good. He was getting kickbacks from his suppliers. He was using the credit union credit card for personal purchases. She was traveling more than she was in the office. He was suspected of sexually harassing a member of his staff. And these: He set up a sweetheart deal for his buddy’s law firm costing the credit union thousands of dollars of unnecessary legal expenditures. He demanded a hefty bonus. He uses drugs in the office. He wouldn’t agree to new terms in his employment contract. A board member wanted his job. He spent a fortune remodeling his office. He caused several of his staff to have nervous breakdowns. Were all of these examples strictly rumors? Of course not. Although some situations may have started out in the credit union rumor mill, weren’t at least some such happenings eventually found to be based on fact? Absolutely! Although most of the CU CEOs involved in situations like those just described were competent individuals with excellent track records, after further investigation it was proved that some were guilty as charged. But not all. The point here is that some were hung with a rumor rope without a thorough investigation. Some very good CEOs were thus lost to credit unions forever. They were tried and convicted in the rumor court and in the process had their credibility and future job prospects taken away from them. As indicated earlier, rumors don’t only have a devastating effect on credit union CEOs. Vendors have been hurt when, for example, ex-employees spread rumors that their former employer has lost contracts, is in financial difficulty, or is undergoing serious morale problems. And CU trade groups are hurt when rumors fly regarding their financial condition, or staffing issues. In the credit union industry, it seems like everyone is fair game. The saddest part of credit union industry rumors, or any rumors for that matter, is that gulible credit union folks seem to accept them hook, line, and sinker even if they are as ridiculous as the completely fictitious one above. (Come on, admit it. Didn’t at least some of you readers at first blush buy into my rumor story just a little bit if only for a fraction of time?) There will always be rumors. That’s human nature. But perhaps it is time to first challenge rumors before buying into them and passing them along. Why not greet each new rumor with questions like these: Do you really believe that? According to whom? Are they (or is it) a credible source? What are the facts? Finally, it’s no rumor that I continue to be frustrated by far too many of my credit union friends and colleagues. Why? Because many credit union persons who should know better are still publicly misstating what makes a credit union a credit union. Even more still can’t find the right words to explain to critics that CUs are not “just like banks” regardless of size and services. And there are still those who hang their hats on words like “more convenient” and “people helping people.” For a final time then, here’s my definition of a credit union: A credit union is a not-for-profit financial cooperative organized to serve the changing financial needs of all the members who own it. What more needs to be said? I now promise to keep my frustration to myself. Comments? Call 1-800-345-9936, Ext. 15, or Fax 561-683-8514, or E-mail [email protected]</p>

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Peter Westerman

Credit Union Times

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