Links in “Credit Unions”

According to CU Business Group, LLC, an MBL CUSO, its clients are reporting that NCUA examiners are focusing on several issues in recent exams:

• Business owner’s living expenses
• Global cash flow calculations
• Flood insurance coverage
• Loan participations
• Taxi medallion loans (no surprise here) [6/13/14]

June 15 is Elder Abuse Awareness Day. Here are some tips on preventing elder financial abuse. ABA offers its tips, too. [6/13/14]

When payday lenders in Ohio were restricted by state law to loans with interest rates of 28%, no more than $500, and with a minimum 31-day payback period, payday lenders began making loans under the Mortgage Loan Act which has no cap on interest rates and permits single lump payments (the case surrounded a borrower who failed to repay a $500, 2-week loan with an interest rate of 235%). A lower court said payday lenders were skirting the law. Ohio's Supreme Court disagreed, saying its justices could not second-guess the intent of legislators. [6/13/14]

Some credit unions are considering arrangements under which they send employees to a health insurance exchange and then reimburse the employees for the cost of premiums with tax-free contributions. The IRS has ruled that these arrangements do not meet the requirements of the Affordable Health Care Act and could subject the credit union to a tax penalty of $100 per day or $36,500 per year per employee. [6/12/14]

There has been confusion concerning which credit unions must revise their contracts with their CUSOs. NCUA has now issued a legal opinion letter that clarifies the issue by stating that only federally insured credit unions that have an investment in or a loan to a CUSO need to revise their agreements to state that the CUSO must submit an annual report to its regulator. Credit unions that simply contract with a CUSO for services are not required to revise those service agreements. [6/12/14]

St. Helen’s Community FCU found itself embroiled in a dispute over the election recall of five board members. The CEO asked NCUA whether it could mail absentee ballots to members who did not attend the special membership meeting. NCUA advised that they federal bylaws do not permit absentee ballot voting at special membership meetings. The credit union mailed the absentee ballots anyway. [6/11/14]

NACHA issues resource designed to help financial institutions assess risks associated with their ACH originator accounts. [6/11/14]

You remember the scene: Russell Crowe as math student John Nash in the film A Beautiful Mind. Suddenly, Nash is struck with his "governing dynamics" theorem—that competitors would be far more successful if they all went after different "targets."

While most of the cybersecurity talk is focused toward large financial institutions, what governing dynamics theory tells us is that mid-size and smaller institutions are actually more attractive targets because malefactors presume that their security measures may not be as robust and they are not being pursued by other predators. Jane Pannier describes what measures to take to defend your institution. [6/10/14]

On his final day as CUNA CEO, Bill Cheney, shares his thoughts about credit union taxation, CUNA’s regulatory and legislative successes during his tenure, and the future of risk-based capital. Cheney is returning to California to become CEO of the $10 billion SchoolsFirst FCU. [6/10/14]

Square is positioning its new product, Square Capital, as an alternative to traditional small business loans. Square Capital leverages Square’s existing payment processing relationship with merchants to offer fast access to capital with simple repayment plans. [6/10/14]