X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

Every so often things happen involving credit unions that causes one to step back and ask, “Who’s kidding who?” Perhaps it needs to be asked more often? Like in situations like these: As if passing a ridiculous banking industry backed resolution that in effect tells the United States Congress to eliminate the not-for-profit tax-exemption of large state-chartered credit unions in the state of Utah isn’t ludicrous enough, the Bee Hive state anti-credit union politicos have gone even further in their ongoing efforts to dump on credit unions at every opportunity. A bill has been introduced to not reduce, but to eliminate taxes on the state’s for-profit banks. Bold move. And politically speaking perhaps a smart one, too. The bankers know it has absolutely no chance of passing, but it does afford them a chance to make a political statement against tax-exempt credit unions. And they know many people won’t recognize their sneaky attempt to compare apples with bananas. Singling out only banks among the hundreds of for-profit entities in Utah to be tax free will of course be met with strong opposition from all the other companies that rightly pay taxes as for-profit corporations. But wisely, the official response from credit union spokespersons in Utah is to publicly support the bill. Doing so takes the wind out of the real purpose behind the maneuver and offers further proof of what credit unions have long said to banking industry lobbyists, namely, work at getting tax relief for your industry instead of trying to add additional taxes on Utah consumers. But who’s kidding who? Banks are obligated to pay for-profit corporate taxes. Credit unions structured as not-for-profits have no such legal obligation. Because both are financial institutions is not relevant. I don’t mean to pick on NCUA Board Member Debbie Matz again, but her latest salvo deserves a comment. Matz is warning credit unions about doing business with third party firms (aren’t all vendors third party?) that provide programs for bounced checks stating that these firms charge very high fees. No they don’t. Any more than the data processor used to process loans sets the loan rate. It is the credit union that determines what fees it will charge its members, not a supplier. As the announced intention of billion-dollar Community Credit Union (CCU) in Plano Texas to convert to a bank charter plays out, new information continues to surface. For example, CCU operates about two dozen branches as part of the Texas Credit Union Services Center that in turn is part of the Texas CU League. If and when the credit union becomes a bank, CEO Gary Base has already indicated he would like to continue to be a major player in that credit union shared branch network. The league seems to be leaning towards saying that is okay with them. Reportedly 30% of the outlet transactions currently go through CCU. If they did not, the league entity stands to lose about $175,000 in annual revenue. Besides the financial consideration, credit union members from all the credit unions in the network will end up using bank branches, and bank customers, credit union branches. Who’s kidding who? This could be yet another example of credit union philosophy taking a back seat rather than suffering a loss of income. Among the lamer reasons given by some less-than-informed credit union folks to explain the credit union difference is that credit union people are honest to a fault. Who’s kidding who? As reported weekly in this publication and others, the number of credit union in-house crimes such as embezzlements and money laundering has shown a sharp increase in the past 18 months. Many of the perpetrators are long time, supposedly loyal staffers. I am reminded of a CEO whom I knew early in my career who was also a part-time preacher. He spent several years in jail for embezzlement. Time to be realistic that people are people. Many credit union boards have learned the hard way that it is best to work with professional search consultants when seeking a new CEO rather than the once common practice of going it alone. That should mean that every new CEO placement is the result of a thorough search to weed out a modest number of finalists from which the board can select its first choice. Who’s kidding who? Not many, but some CU CEOs landed the top spot because of a cozy relationship with a headhunter. In one recent case, well-qualified candidates were told not to bother submitting their resumes because enough candidates were already in hand. In fact, the CEO selection was a done deal. Even boards can be manipulated in some of these situations. Somewhat related, some of the most qualified credit union CEO candidates are automatically discarded up front because they do not possess a college degree. After 20-plus years of successful credit union management experience, how important can a degree be? What an individual did for four years in his or her life when in their 20′s hardly seems more relevant than what they have done since. But who’s kidding who? Some of the top leaders and well-known executives in the credit union world (who shall go nameless here) never finished college and earned a degree. Readers would be quite surprised at who and how many respected credit union pros fall into this category. All of which means that in the world of credit unions all things are not necessarily as they might seem. Next time someone tries to pull the wool over your eyes and expects their actions or statements to be taken at face value, it might make sense to ask the question, “Who’s kidding who?” Comments? Call 1-800-345-9936, Ext. 15, or Fax 561-683-8514, or E-mail [email protected]

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.

Already have an account?

Peter Westerman

Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.