Welcome to the February 2019 edition of Priority Report. This month, we’ll highlight progress with the advocacy updates, progress made with CUNA and CU Link, as well as the upcoming Annual Convention & Exposition (AC&E) in Detroit.
We’re in the process of wrapping up our 2019 affiliation cycle. We’ve been fortunate over the past several years to have a strong working relationship with all of our credit unions and we look forward to continuing to build those partnerships again this year. If you haven’t yet submitted your 2019 affiliation, we encourage you to reach out to your league reps. They can walk you through our easy-to-use online system. We’re proud to provide great value and top quality for your dues in 2019 and beyond.
While we’re growing relationships with new congressional members, the MCUL team is working in tandem with the Credit Union National Association (CUNA) on several federal legislative issues.
Last year, legislation was introduced in the Senate and House to reform and expand affordable housing in the United States. Unfortunately, the bill included a provision that would have expanded the Community Reinvestment Act (CRA) to cover credit unions. This represents a gap in understanding how credit unions serve their communities and gives an unfortunate platform for modified banker attacks. As a result, MCUL will work with CUNA to educate and ensure members of Congress understand that credit unions, by their very mission and structure, cannot engage in the practices the CRA was designed to prohibit. Furthermore, the provision expanding the CRA to credit unions is without merit as no evidence exists that credit unions are engaged in lending discrimination. The bankers’ “misery loves company” tactics should not be allowed to extend these regulations unnecessarily to credit unions.
Similarly, legislation was also introduced in both federal chambers to greatly restrict overdraft protections. These are valuable services, requested by the consumer, and MCUL will work with CUNA to ensure that our lawmakers are educated on the truth of this product and how it delivers value for consumers. We don’t expect this legislation to gain traction but we will work hard to make sure that it doesn’t.
Data security continues to be a top priority as retailers seemingly avoid responsibility when it comes to safeguarding collected consumer financial information. While we continue to proactively address data breach legislation in Lansing, our work on the issue does not stop there. State laws only go so far and any true or lasting solution must come from federal action or harmonization of state laws.
On the state level, data breach legislation is set to be reintroduced. Chair of House Financial Services, Rep. Diana Farrington will once again be the main sponsor of the package. This legislation stipulates that merchants experiencing a breach would have 45 days from discovery in which to provide notification, regardless of the original start date. MCUL is working with the card companies on a solution to potentially get this information sooner through processor-to-processor notification channels.
Sen. Tom Barrett, member of the Senate Banking Committee and veteran, will be introducing the Uniform Unclaimed Property Act—Escheats of Military Accounts. This issue was brought forward by a handful of credit unions with this finding on their exams. The law currently provides two different timelines in which escheats must be done for the regular person and for active duty overseas military members. However, the DOD database doesn’t provide status on active duty military member in the category of stateside vs. overseas.
This legislation will allow credit unions to hold onto the account for the extended timeframe for all active duty military as determined by the DOD database. MCUL staff worked diligently to get these findings removed and this legislation is a result of our research on this issue. Furthermore, MCUL continues to monitor all legislation being introduced to ensure it provides benefits, not burdens, to our members. We are currently watching legislation on a variety of additional issues, like cryptocurrency and civil asset forfeiture.
In early February we had the opportunity to meet the new Department of Insurance and Financial Services (DIFS) Director Anita Fox. Our chairman, along with our advocacy team had an opportunity to discuss important credit union issues such as data breach, cannabis banking and our tax-exempt status. We also discussed the examination process and our desire to have ongoing communications and mutual support with DIFS. New Director of Office of Credit Unions, Denice Schultheiss, was also part of the meeting and we are encouraged by her years of DIFS’ experience and commitment to getting to know and interact with credit unions across the state.
Earlier this month, former NCUA Chief Policy Officer Todd Harper was appointed by the President to fill the vacant seat on the NCUA Board. Harper brings a considerable amount of knowledge to this appointment with nearly 25 years of experience in financial services policy and regulation. We look forward to the positive impact he’s expected to make on behalf of the credit union industry. This position will fill the remainder of a six-year term, set to expire on April 10, 2021.
Working together, MCUL and CUNA have submitted joint amicus briefs in support of credit unions that were targeted by frivolous lawsuits claiming violations of the Americans with Disabilities Act (ADA). Briefs, filed in the Sixth Circuit Court of Appeals in support of Belle River Community Credit Union and Aeroquip Credit Union, argue that the plaintiff lacks standing to join the credit unions in question, and therefore cannot suffer harm by being deprived of services. It is our hope to persuade the Sixth Circuit to reverse the lower court’s decision that denied both credit unions’ motions to dismiss. Both credit unions are being sued by the same plaintiff.
MCUL has made it a priority since 2017 to combat these lawsuits and assist Michigan credit unions that have been unfairly attacked by them, as has CUNA on the national level.
On the topic of lawsuits, this month, a proposed settlement was submitted to the court in First Choice Federal Credit Union v. The Wendy's Company. If approved, it would conclude the data breach lawsuit from a 2016 data breach at certain Wendy’s franchise locations. If the U.S. District Court for the Western District of Pennsylvania approves the settlement, financial institutions will be paid under the claims process set up through the settlement. Updates will be posted to MCUL.org as information becomes available.
MCUL’s partnership with CUNA is a prime example of how collaboration can result in positive impact not just for our credit unions, but for consumers as well. That is most evident with the progress made in the CU Link campaign. At this moment, FocusIQ is drafting up media plans and production calendars to launch our campaign this coming spring. It’s our plan to sync up with the CUNA “Open Your Eyes” campaign and magnify the message that credit unions are all around and here to help.
By focusing on dispelling misperceptions about credit unions, we plan to promote our strengths in areas of value, convenience, technology sophistication, breadth of offerings and local community commitment. We aim to tackle any preconceived myths consumers harbor and replace those notions with the promise that ‘opening your eyes to a credit union’ is not only better for your wallet, but for your family and community.
Look for more information next month as we finalize details on integration, media and the 2019 theme.
Another important collaboration is the one we share with our Foundation. This year, the MCUF strategic plan is continuing to support credit union community reinvestment and financial education initiatives with 85 percent of the Foundation budget allocated to these activities. The goal is to raise and distribute more than $200,000 this year to help with social mission activities that help more people, families and Michigan communities thrive financially. In addition to individual grants for credit union and chapter initiatives, this support helps fund several coordinated statewide financial education programs that aim to reach 14,000 families this year through Money Smart Kids Read, Personal Finance Challenge and Financial Reality Fairs.
If you have not yet donated, please consider joining in to help us make a bigger credit union social mission impact together through the Foundation. You can learn more, donate or apply for programs at mcuf.MCUL.org or contact Beth Troost to find out how to get started. Thanks to the many credit unions that have already submitted an annual donation this year.
Meanwhile, the Michigan High School Personal Finance Challenge is currently underway. In this statewide initiative, high school students demonstrate their knowledge of personal finance by competing with other students across the state. The top teams will be invited to participate in the state finals competition at the Federal Reserve Bank of Chicago-Detroit Branch this coming April.
We encourage you to invite your local high schools to participate by March 25. Our goal is to reach 1,000 students and have participation from every region of the state. Find out more on the Foundation website.
The MCUL Education team is steadily working on ways to help credit unions grow and leverage team strengths. Coming to the Lending and Marketing Conference held in April, Speaker Sam Kilmer focuses on digital banking strategies and the best practices that transform digital experiences into revenue generators. We expect nearly 150 credit unions in attendance, offering opportunities to network, increase knowledge base and improve performance.
With cannabis projected to be a billion-dollar industry and Michigan voters approving the legal use and possession of marijuana for recreational purposes, now is the time for credit unions to address potential issues within marijuana banking services. Presenting at the Spring Leadership Development Conference this April at the Soaring Eagle Casino & Resort, speaker Chuck Holzman tackles the topic of marijuana in Michigan and what it means to you as service providers and employers.
Before we jump into CUSG updates, we wanted to take a moment and let you know that registration is open for the June AC&E. This year’s event, to be held in downtown Detroit, is expected to be one of our best yet. If you enjoyed last year’s event, we can’t wait for you to see what’s in gear for 2019. Visit the MCUL website to learn more.
First, in the area of technology, in Dave Adams’ monthly CU Insight column, CEO Connect, he discusses new fintech disruptors that many are referring to as “neobanks.” This term describes a collection of early-stage companies — like Chime, MoneyLion, Acorns, Moven and others — that presumably make it easier for consumers to manage money in a highly mobile age. Offering mobile-based services like prepaid debit, lending, investing and personal finance management, these neobanks are making an impact with the underbanked, millennials and speed-conscious consumers.
More importantly, in this article Adams poses the question: Where are all the neo-credit unions? As a first step toward answering this question, last year, CUSG introduced LifeSteps Wallet, an innovative tool that helps credit unions leverage a one-app, mobile banking plus strategy for members. It enhances the core mobile banking app with features associated with home and auto ownership, shopping and financial wellness. It’s a strong value add for members that also keeps them in the periphery of your credit union’s core products and services. For a closer look, watch the video, read the article and share your feedback on this competitive issue facing our industry.
In the Marketing Solutions division, the Love My Credit Union Rewards team is making participation in our programs easier and more profitable for our clients. They’re unveiling a new payment programs, increasing payout on our Sprint program and reducing program qualifications for participating credit unions. If you’re interested in learning more about our new payout model or updated qualification requirements, please reach out to our team for more information.
In addition to making the program more valuable for credit unions, we’ve also been working hard to make the program more valuable and convenient for credit union members. After extending our $100 cash reward offer to unlimited lines per customer, we also made the registration process easier and more streamlined for members. With our latest improvements, we’ve already seen a 50 percent decrease in call center volume, suggesting members are more satisfied with this highly efficient and effective approach.
Finally, if you’re one of the more than 2,000 Love My Credit Union Rewards clients currently offering our Sprint Cash Rewards program, new, free advertising and promotional materials will be rolling out later this month — be sure to check the LMCUR Partner Center. For those credit unions not already offering Sprint Cash Rewards to their members, there are plenty of credit union and consumer benefits. Enrolling is a quick and easy process; contact us for more information.
As we all know, tax season is upon us. So far, 2019 has been a slower-than-average year for filing, possibly led by the recent government shutdown. Still, many credit unions are offering their members the Love My Credit Union Rewards’ TurboTax discount along with important content regarding new tax laws that went into effect this year. Marketing at key times during the tax season is essential to building member awareness about the TurboTax discount, so we’ve made these informational resources, along with free marketing materials, available in the LMCUR Partner Center.
In the HR Performance Solutions division, we’re gearing up for the release of a new user interface for Performance Pro, scheduled for release during the first quarter. Part of this preparation is adding new tutorial content to the HRPS YouTube channel. The first planned demonstration video will show the six key changes of the application’s navigation. This update will create a more streamlined user experience and follows the design standards of our other HRPS products, like Compease and Planning Pro. If you currently use Performance Pro, be sure to check out the new videos to learn about the upcoming features of the updated interface. These videos are also a great way to see how this software can simplify and track performance management if you’re not already using the product.
Finally, CUSG’s Strategic Advisory Services team is excited to enhance their existing board governance solution with the launch of GovernEase, set for the first quarter of 2019. The GovernEase portal will include a library of more than 40 customizable, governance-specific policies designed for Boards of Directors and CEOs. It will help them develop sound best practices and will also include a discussion board to collaborate and converse with peers, ask questions or post comments.
Our mission is to help credit unions serve, grow and remain strong. We are proud of the impact our industry has on the state, our communities and your members.
If you have questions or suggestions on how MCUL and CUSG can better meet your needs, again, feel free to contact any member of our leadership team.