News/Articles
Articles and news items related to CUSOs, credit unions and compliance issues.
2023 End of Year Summary
Happy Holidays! As we prepare for the New Year, we are looking back at 2023 and revisiting a few of the topics we covered this year. Did you know that Messick Lauer & Smith has a LinkedIn page where you can find articles and summaries on topics we believe are important for everyone in the […]
FCU Bylaw Amendments
FCU Bylaw Amendments will be required for updating member expulsion policy. This summer, the NCUA adopted a final rule permitting a federal credit union (“FCU”) to expel a member for cause by a two-thirds vote of the FCU’s board of directors. The NCUA was required to develop a policy under which a member could be […]
Negative Option Marketing Practices
By: Jennifer Winston Jwinston@cusolaw.com Last month, the CFPB released Consumer Financial Protection Circular 2023-01 emphasizing unlawful negative option marketing practices. The CFPB has stated that engaging in negative option marketing practices violate the Consumer Financial Protection Act’s (CFPA) prohibition on unfair, deceptive, or abusive acts or practices (UDAAP). “Negative option” refers to either a term […]
Corporate Separateness
By: Michael Mulvey mmulvey@cusolaw.com One of the benefits of forming a CUSO is the limited liability protection offered to a CUSO’s investor(s). In order to maintain this protection, the CUSO and investing credit union(s) must maintain corporate separateness. This means the two entities’ operations are separate and distinct from each other. The reason this […]
The Contract Life Cycle and its Importance to your Third Party Risk Management Program
By: Michael J. Heller mheller@cusolaw.com Part 1: Contract Review As credit unions increasingly rely on third party relationships to remain operationally efficient and competitive and to provide the most innovative and up-to-date services to members, contract review, negotiation, and monitoring are, and will continue to be, critical aspects of an effective third party risk management […]
Proposed FTC Rule to Prohibit Non-Compete Clauses
By: Michael Heller mheller@cusolaw.com The Federal Trade Commission (“FTC”) published a new proposed rule on January 19, 2023 to prohibit the use of non-compete clauses in certain agreements. The proposal is currently in the commentary period, which will end on March 20, 2023. If adopted, the proposed rule will require employers that use non-compete […]
Crypto Rules
By: Michael Mulvey mmulvey@cusolaw.com For our blockchain or cryptocurrency enthusiasts out there: Following the downfall of FTX and subsequent hearings in December, Senators Elizabeth Warren and Roger Marshall introduced the Digital Asset Anti-Money Laundering Act authorizing rule making, risk-focused examination and review processes and reporting for federal agencies. SIL22D55 (senate.gov) Additionally, the New […]
CFPB – Reasonable Investigations of Consumer Reporting Disputes
By: Jennifer Winston jwinston@cusolaw.com The Consumer Financial Protection Bureau (CFPB) has recently released another Circular addressing reasonable investigations of consumer reporting disputes. The CFPB is issuing this Circular to emphasize that certain practices involving the failure to conduct a reasonable investigation of disputes can violate the Fair Credit Reporting Act (FCRA). In Circular 2022-07, […]
Virtual Meetings – Emergency Exception
By: Jennifer Winston jwinston@cusolaw.com There has been some uncertainty whether federal credit unions could continue to hold completely virtual annual meetings in 2023 under the emergency exception bylaw announced in 2020. We now know that the answer is NO. In a Letter to Credit Unions issued this week, the NCUA has announced the expiration […]
NCUA Guidance Statement – Expansion of Permissible CUSO Activities and Associated Risks
By: Michael Mulvey mmulvey@cusolaw.com In November 2021, the NCUA expanded the lending capabilities of CUSOs. CUSOs can now engage in all types of lending permitted for federal credit unions. The NCUA recently released a letter to credit unions providing guidance on the CUSO lending rule now that the rule has been in effect for […]
Federal Credit Union Act Amendment – Expelling Members
By: Jennifer Winston jwinston@cusolaw.com On March 15, 2022, Congress enacted the Credit Union Governance Modernization Act of 2022 (CUGMA). The CUGMA amended the Federal Credit Union Act to allow FCUs to expel members engaging in abusive, illegal, or violent behavior with a two-thirds vote of the FCU’s Board of Directors in accordance with a policy […]
2023 Supervisory Priorities
By: Jennifer Winston jwinston@cusolaw.com In Letter to Credit Unions 23-CU-01, the NCUA has outlined its supervisory priorities for 2023. The NCUA’s primary areas of supervisory focus this year will be: Interest Rate Risk: The NCUA sees the sharp rise in rates as amplifying “market risk because a credit union’s assets and liabilities do not […]
UDAAP Violations Over Data Security
The CFPB has published a Consumer Financial Protection Circular (Circular) (2022-04) that makes clear insufficient data protection or security for sensitive consumer information may violate the prohibition on unfair acts or practices under the Consumer Financial Protection Act (CFPA). This Circular does not have any impact on federal laws that currently govern data security for […]
NCUA Vendor Oversight Authority Passes the House; NCUA Proposes New Rule on Cyber Incident Notification
Following up on a previous post regarding legislation that would grant the NCUA authority to regulate and examine all vendors that do business with a credit union, the House recently passed the National Defense Authorization Act including an amendment that would grant the NCUA such oversight authority over a credit union’s third-party vendors. As previously […]
Benefits of the Holding Company Structure
Leveraging the Profits Made by CUSOs The primary advantage to using a holding company CUSO is a consolidation of CUSO investments and leveraging the profitable CUSOs to make additional CUSO investments. A federally chartered credit union may only invest up to 1% of its assets in CUSOs in the aggregate. However, NCUA defines CUSO investment […]
Your Third Party Risk Management Program
With summer in full swing, now is as good of a time as any to review your internal processes to see how your programs are performing measured against expectations and determining whether any updates need to be made. This post will be a high level focus looking under the hood of your third party risk […]
CFPB Releases Circular on Adverse Action Notification Requirements When Using Complex Algorithms for Credit Decisions
If you attended our NACUSO presentation this spring, you heard me discuss how the Consumer Financial Protection Bureau (CFPB) has increased their focus on rooting out discrimination and discriminatory practices. CFPB Director Chopra has said that he believes the growing use of algorithms could raise issues of both overt and unintended discriminatory practices. We have […]
CFPB Expands UDAAP to Include Discrimination in All Areas of Consumer Finance
With a change in administrations, we often see changes from a regulatory perspective. One area receiving attention from the current administration are targeted efforts at protecting “protected classes” and serving the underserved, for example the NCUA’s recent letter reminding credit unions about prohibited acts under the Equal Credit Opportunity Act (ECOA). This week, the Consumer […]
NCUA Vendor Oversight Authority Advances in House Committee
Since the NCUA’s ability to have direct oversight over vendors sunset over twenty years ago in the aftermath of Y2K, the agency has consistently made the case internally and in testimony to Congress to regain such authority. The NCUA has most recently cited cybersecurity concerns as justification for vendor oversight authority. Instead of addressing any potential cybersecurity […]
NCUA CUSO Registration
As you know, part of forming a credit union service organization (“CUSO”) involves registering the company on the National Credit Union Administration’s (“NCUA”) CUSO Registry. Within sixty (60) days of the first credit union making an investment in the CUSO, the CUSO must register with the NCUA. The web-based registration process takes approximately fifteen minutes […]
Client Corner – CU Rise Analytics
Messick Lauer & Smith PC continues its semi-regular Webinar series. This Client Corner features CU Rise Analytics. Learn more about how CU Rise Analytics is helping credit unions to provide superior member service. Here is the link to this webinar: https://vimeo.com/478186485 For more information regarding CU Rise Analytics and their services, please visit their website: […]
Client Corner – DoubleCheck Solutions, LLC
Messick Lauer & Smith PC continues its semi-regular Webinar series. This Client Corner features DoubleCheck Solutions, LLC. Learn more about how DoubleCheck Solutions, LLC is helping credit unions to provide superior member service. Here is the link to this webinar: https://vimeo.com/459107418 For more information regarding DoubleCheck Solutions, LLC and their services, please visit their website […]
Client Corner: LenderClose
Messick Lauer & Smith PC continues its semi-regular Webinar series. This Client Corner features LenderClose. Learn more about how LenderClose is helping credit unions to provide superior member service. Here is the link to this video: https://vimeo.com/436912700 For more information regarding LenderClose and their services, please visit their website www.lenderclose.com
Using Remote Online Notarization In Response To COVID-19
Using Remote Online Notarization In Response To COVID-19 There is no doubt that by now we have all encountered many challenges working and sustaining business during the pandemic. Mortgage lending, particularly, has faced numerous unique challenges, one of which is the access to the notary services required to close loans. With social distancing restrictions in […]
Client Corner: POSH – Conversational AI for Credit Unions
Messick Lauer & Smith P.C. will be running semi-regular webinars introducing clients to our other clients. It is a chance to spread the word about great products and services offered by CUSOs to the credit union industry. We are starting with Posh, a conversational AI provider. Here is a link to the recording of this […]
Being Productive and Prepared During Difficult Times
Due to the COVID-19 pandemic, many credit unions and CUSOs have been required to adjust. Most employees are working from home or performing their duties in a non-traditional manner. Third party relationships may have been altered or suspended entirely. Given the rapidly changing nature of the workplace and third party relationships, it can seem disorienting. […]
Regulatory Guidance Related to COVID-19
NCUA This week, the NCUA has issued a Letter to Credit Unions “NCUA Actions related to COVID-19” (Letter No: 20-CU-02). This NCUA Letter also contains FAQs regarding COVID-19, NCUA and credit union operations. These FAQs cover impacts to, and flexibility for, annual meetings and elections; FCU monthly board meetings; restrictions on branch access and branch […]
Promoting Credit Unions As A Whole To The Small Business and Real Estate Investor Community
Mark Ritter, CEO of MBFS is on an initiative to promote credit unions as a whole to the small business and real estate investor community. Below is a link below to a recent interview he did as part of this effort. https://www.stitcher.com/podcast/the-business-credit-and-financing-show/e/62754794?autoplay=true
At NACUSO Annual, Compliance Quartet Highlights Hot-Button Issues
Regardless of credit union leaders’ politics, one CU advisor says from a compliance perspective “there have not been a lot of negatives” since President Trump took office in early 2017 . . . Please click here to read more. [Subscription may be required]. This article, written by Michael Bartlett, was originally published in the […]
The Equifax Breach and Credit Union Involvement
The Equifax breach has resulted in a landslide of opinions, articles and media coverage. While the wealth of information is helpful, talking about what the breach may mean specifically for credit unions is critical. This webinar will provide a base for ongoing discussions relating to future CU impact due to regulatory and legislative changes. Slide […]
Responsible and Profitable Banking of MSB and MRB Clients
Below is a link to a webinar presented by Hypur, Inc. Guy Messick, general counsel for NACUSO, had the pleasure of introducing Hypur and their presentation.
How do Credit Unions Begin the Process of Collaboration?
This presentation is for credit unions that know they need to consider CUSOs and collaborative solutions but do not know how to get started. How Do Credit Unions Begin the Process of Collaboration? from Messick Lauer & Smith P.C. on Vimeo.
CUSO Reviews: How to Get Ready.
Messick & Lauer P.C. host this webinar regarding CUSO reviews. The NCUA CUSO Registry re-opened for CUSOs to reaffirm the data submitted to the NCUA last year. From here on out, this reaffirmation will be done annually. The question is what will the NCUA do with this data. The likely answer is prioritize reviews (examinations) […]
CUSOs Feeling Better About Registry as Reaffirmation Period Looms
The National Credit Union Administration’s CUSO Registry will open its required annual “reaffirmation period” next week with one significant change – there’s a lot less anxiety for registrants in 2017 than there was last year. Please click here to read more. [Subscription may be required]. This article, written by Michael Bartlett, was originally published […]
Regulatory Developments & CFPB Update
This webinar focused on recent regulatory and legal trends, supervisory highlights, and updates on recent enforcement actions to help credit unions and CUSOs be prepared for the upcoming year. Regulatory Developments and CFPB Update from Messick & Lauer on Vimeo.
What CFPB’s Employee Incentive Warning Means for CUs
The backlash against Wells Fargo (and, in its wake, virtually all financial institutions) continues unabated as the Consumer Financial Protection Bureau (CFPB) recently warned such companies in a bulletin to properly manage their employee incentives which can pose significant risks to consumers. Please click here to read more. [Subscription may be required] Amanda Smith, Partner […]
Signing a New Vendor Agreement? Consider This First.
Credit unions are constantly entering into agreements with third-party vendors ranging in criticality from vendors that implement a new core processor to vendors that provide custodial services. Please click here to read more. This article is from the November 6, 2016 issue of Credit Union Times Magazine. [Subscription may be required]. Michael J. Heller is […]
The Importance of Data Breach Preparation
Data breaches and cybersecurity incidents happen every day, and credit unions need to be considering what to do when – not if – they are attacked. Please click here to read more. This article is from the October 19, 2016 issue of Credit Union Times Magazine. [Subscription may be required]. Jennifer Winston is an Associate […]
How Will CFPB’s Action Against Navy Impact Reg Reform?
Please click here to read more. [Subscription may be required]. Amanda Smith, Partner with Messick and Lauer P.C., is quoted in this article written by Palash R. Ghosh, which was originally published in the Credit Union Journal on October 13, 2016.
Insurance Services: An Opportunity for Credit Union Growth
The insurance industry presents a unique opportunity for credit unions to grow strategically. Insurance is not only a way to add value for members, but also presents a source of non-interest income. Chances are your members have some type of insurance, whether its healthcare, auto, property, or life and if they’re not getting these services […]
CUSO 101 – The Organization and Operation of CUSOs
CUSO 101 from Messick & Lauer on Vimeo.
Cybersecurity and Data Breaches – How to Prepare, Protect and Respond
Cybersecurity and Data Breaches – How to Prepare, Protect, and Respond from Messick & Lauer on Vimeo.
Military Lending Act Changes
The Military Lending Act (MLA) has traditionally applied to three (3) types of loan products: payday loans, vehicle title loans, and refund anticipation loans. Under the Final Rule, beginning October 3, 2016, the MLA will apply to products generally covered by the Truth in Lending Act and Regulation Z, including deposit advance loans, installment loans, […]
Overtime Exemption Rule Changes
The Department of Labor (“DOL”) has released its final rule that is intended to provide stronger overtime protection and clarity to both workers and employers. Read the Final Rule here. This general summary email is the first in a series our office will publish on the new overtime rule. To determine if a white collar […]
NCUA Meeting Provides CUSO Guidance
On June 14, Jack Antonini, NACUSO President and Guy Messick, NACUSO General Counsel met with NCUA Staff on the results of the CUSO Registry and the thinking on how CUSO Reviews will be handled. The CUSO Registry sign-up period and the follow-up by NCUA found there were approximately 900 CUSOs. NCUA believes that there are […]
MBL UDATE
As a follow up to correspondence sent out a couple of weeks ago regarding the elimination of the personal guarantee requirement under the new MBL rule, we received feedback that this is not the case for federally insured state-chartered credit unions in Illinois. Illinois state-chartered credit unions must still obtain personal guarantees on all MBLs. […]
New Options in Business Lending are Now Available
Under the new NCUA MBL regulation, the personal guarantee requirement was set to be eliminated sixty (60) days after the final rule’s publication in the Federal Register. May 13 was the 60th day. For once Friday the 13th is a lucky day. Credit unions are now permitted to evaluate a particular member business loan’s risk […]
Five Ways CUSOs Are Serving Changing Needs Of CUs
How are CUSOs helping credit unions and their members? The approaches are changing, as are the needs of members coming out of the recession. Please click here to read more. [Subscription required] Brian Lauer, Partner with Messick and Lauer P.C., is quoted in this article written by Ray Birch which was originally published in the […]
Should Credit Unions Outsource Their Compliance?
As the pace of new government regulations continues unabated, an increasing number of credit unions are seeking to outsource their compliance operations to third-party vendors as a means of cutting costs and relieving the burden of immense paperwork and man-hours. Please click here to read more. [Subscription required] Amanda Smith, Partner with Messick and Lauer […]
What Will Future of MBLs Look Like Under New NCUA Rule?
Credit unions, mark your calendars for Friday, May 13. That’s when, under a new NCUA rule, member business loans will not require a personal guarantee under certain circumstances. That’s the biggest change in the final rule approved by the agency last month, according to industry insiders and experts. Please click here to read more. [Subscription […]
Now that CUSOs Have Registered with NCUA, What’s Next?
The National Credit Union Administration required all credit union service organizations to register by March 31, and while the process went mostly smoothly, some CUSOs now worry what will happen with the information they have provided the regulator. Please click here to read more. [Subscription required] Brian Lauer, Partner with Messick and Lauer P.C., is […]
CUSO Registry Clean Up Period
As most of you know, all CUSOs are obligated under the NCUA Regulations to register certain information directly with NCUA on an annual basis. Over 800 CUSOs did so in February and March. NCUA is now in the process of making sure all CUSOs have registered. Their new deadline is April 30, 2016. They are […]
Save the Frog: Collaborating to Survive and Thrive
I am constantly trying to get the attention of credit unions to persuade them that even successful credit unions need to collaborate and they need to start now. With every Tom, Dick and Harry competing to take away the traditional business lines of financial institutions, credit unions cannot sit back and wait for things to […]
Change to the CUSO Registry Acknowledgment
During the process of assisting with CUSO Registry questions, it came to our attention that in order to complete the CUSO Registry, CUSOs were required to agree to be bound by statutes that apply to credit unions which imposed penalties that are not applicable to a CUSO. On behalf of NACUSO and the many CUSOs […]
RESPA Compliance and Marketing Services Agreements
Back in October, 2015, the CFPB issued a Compliance Bulletin to remind participants in the mortgage industry of the prohibition on kickbacks and referral fees under the Real Estate Settlement Procedures Act (RESPA) and to describe the substantial risks posed by entering into Marketing Services Agreements (MSAs). The link to the Bulletin can be found […]
CFPB Expands Definition of Small Creditor and Rural Areas
The CFPB has issued a final rule that revises the definitions of “small creditor” and “rural areas” under Regulation Z of the Truth in Lending Act (TILA). The final rule is effective January 1, 2016. The CFPB created special small creditor provisions with regard to certain Regulation Z requirements. The revised definitions will affect the […]
Stop Apologizing and Start Advocating
It is time that we remember who we are as credit unions and what we stand for. It is time to revisit our core principles and value and advocate how credit unions have made America and Americans financially stronger. It is time to stop apologizing for our desire to grow credit unions and give more […]
Is the Pendulum on the Back Swing?
We have worked through a difficult regulatory period for the last five years or so, including both regulatory retraction and regulatory overreach. We had Reg Flex revoked and too too many regulations imposed upon credit unions. But is the pendulum changing directions? There have been several news reports and proposed regulations that appear to say […]
CFPB Provides Guidance on Using Social Security Disability Income in Mortgage Lending
On November 18, 2014, the CFPB issued a compliance bulletin regarding Social Security Disability Income Verification. The Bulletin was issued to remind creditors of their obligations under the Equal Credit Opportunity Act (ECOA) and Regulation B, with respect to consideration of public assistance income, and to highlight standards and guidelines regarding verification of Social Security […]
Attorney Escrow Accounts Are Now Insured
The President approved legislation that enables federally insured credit unions to offer insured IOLTA accounts. These are escrow accounts held by an attorney which contain clients’ funds. Since the money held in escrow by the attorney were the funds of the clients, the previous rule would only extend share insurance to those funds held by […]
Lessons Learned from CFPB Enforcement Actions
On September 25, 2014, the CFPB entered into a Consent Order with a Michigan title insurance agency to settle charges that the title agency entered into certain Marketing Services Agreements (“MSAs”) in violation of the Real Estate Settlement Procedures Act. This Consent Order provides three valuable takeaways for parties that have entered into MSAs with […]
Pennsylvania Powers of Attorney Update
Pennsylvania has enacted broad changes to the laws governing Powers of Attorneys (“POA”) for financial and property transactions. Below is a brief overview of some of the changes effective January 1, 2015. For POAs executed on or after January 1, 2015: A POA may be signed by another person on behalf of the principal only […]
Annual Privacy Notices May be Posted Online Under Certain Circumstances
Originally posted November 12, 2014 The CFPB has amended Regulation P, which requires, among other things, that financial institutions provide an annual disclosure of their privacy policies to their customers. So long as certain requirements are met, the amendment allows annual disclosures to be posted online, saving your Credit Union or CUSO time and money. […]
CUs Link for Compliance
The following is a link to an article published in the Credit Union Times wherein a member of our firm is quoted. CUs Link for Compliance by Michelle A. Samaad 4/22/2012 http://www.cutimes.com/2012/04/22/cus-link-for-compliance
Irish CU’s Lent a Helping Hand
The following is a link to an article published in the Credit Union Times wherein a member of our firm is quoted. Irish CU’s Lent a Helping Hand by Candice Reed 9/24/2012 http://www.cutimes.com/2012/09/24/irish-cus-lent-a-helping-hand
Experts Discuss How to Make CU Link Ups Succeed
The following is a link to an article published in the Credit Union Times wherein a member of our firm is quoted. Experts Discuss How to Make CU Link Ups Succeed by Peter Strozniak 10/22/2012 http://www.cutimes.com/2012/10/22/experts-discuss-how-to-make-cu-link-ups-succeed
Protect CUSO Operations Against Scrutiny
The following is a link to an article published in the Credit Union Times wherein a member of our firm is quoted. Protect CUSO Operations Against Scrutiny by Michell A. Samaad 3/6/2011 http://www.cutimes.com/2011/03/16/protecting-cuso-operations-against-scrutiny
CUSOs Can Falter After Mergers and Conservatorship
The following is a link to an article published in the Credit Union Times wherein a member of our firm is quoted. CUSOs Can Falter After Mergers and Conservatorship by Michell A. Samaad 11/24/2011 http://www.cutimes.com/2011/07/24/cuso-can-falter-after-mergers-and-conservatorships
Net Seller Model May Create More Control
The following is a link to an article published in the Credit Union Times wherein a member of our firm is quoted. Net Seller Model May Create More Control by Michell A. Samaad 11/14/2012 http://www.cutimes.com/2012/11/14/net-seller-model-may-create-more-control
OnApproach, LLC to Acquire Technology Navigator, LLC
Plymouth, MN (June 13, 2014)–OnApproach, a leading provider of reporting and analytics solutions to credit unions, announced today that it has entered into an agreement to acquire Technology Navigator. Technology Navigator is a Credit Union Service Organization (CUSO) providing reporting and analytical solutions to analyze risk, assess lending and certificate portfolio makeup, address key performance […]
The “Net Seller” Revenue Leverage
Credit unions want revenue and those credit unions that are able to book good yielding loans do not want to give that yield up. But retaining all the yield from loans is not always the best business decision. If a credit union has a high loan demand it is much more advantageous to be a […]
Preventing Fraud in the Accounts of Decedents, Minors, and Other Fiduciaries
Decedent, minor and other fiduciary accounts, such as those subject to powers of attorney, are particularly susceptible to fraud. While some of these instances of fraud may result from an ignorance of the law on the part of the person with whom the credit union is dealing, many times they are purposeful evasions of the […]
Forming New Credit Unions to Meet Our Mission
We lose approximately 250 to 300 credit unions per year to mergers, liquidations, and conversions. Only a handful of credit unions have been formed in the last ten years that survive today. While I understand that credit union assets and members are growing despite the reduction in the number of credit unions, I submit that […]
Collaborating Your Way to Compliance
We often talk about collaboration in the context of business and product development; however, collaboration can also play an important role in regulatory compliance. It is undeniable that the current regulatory climate is complex and can even seem insurmountable at times. It is showing no signs of slowing down and credit unions will have to […]
Preparing for Questions About CUSO Separateness
There are many reasons why a credit union would invest in a CUSO instead of providing the same services directly through the credit union. These reasons may be that the CUSO is a collaboration of several CUSOs to create economies of scale, that it would be too cost prohibitive to initiate the service from the […]
Compliance and Proposed Rules
Like most people, I am getting tired of the regulatory onslaught. But, we need to stay diligent. There are advantages to paying attention. First and foremost, you might be able to influence the regulator and reduce the adverse consequences of a new rule. The industry spends a lot of time and a lot of effort […]
Compliance and Outsourced Services
Credit unions engage third party vendors for a variety of reasons. Some third party vendors bring expertise to the table that allows the credit union to offer products and services to its members that it would not otherwise be able to offer. Other vendors provide products and services in a manner that is more cost […]
It’s Ten O’Clock. Do You Know What Your CUSO is Doing?
Many have heard that the NCUA is setting its sights on CUSOs because CUSOs are playing a more important and influential role in the credit union industry. You may have read the transcript of Chairman Matz’s testimony before the Senate, or you are experiencing it first hand with a zealous examiner shining his or her […]
We Must All Hang Together or We Will Surely Hang Separately
“We must all hang together or we will surely hang separately.” Benjamin Franklin uttered these words as he signed the Declaration of Independence and faced the wrath of King George. The colonies were at a crossroads. Despite divergent and competing interests, the colonies recognized that together they had a chance for survival and alone they […]
Turing the Regulator into Your CUSO’s Marketing Director
The vast majority of people who work at NCUA and the state credit union regulatory agencies fully appreciate that credit unions need economies of scale and more expertise in order to survive and thrive in today’s regulatory climate. Combining operational services can be very effective. Many credit unions have collaborated in such services as business […]
Top Ten List of Things Ongoing Operations Learned in Their CUSO Exam
This is a post by Kirk Drake (with a little input from me) on the Ongoing Operations Blog which you should check out. http://ongoingoperations.com/blog/ Earlier this year, the National Credit Union Administration (NCUA) conducted a voluntary CUSO exam of Ongoing Operations. Overall, the experience was a positive one with the Regulators having the opportunity to […]
Our Fee Structure – Video
This is a 1:36 minute presentation on the Firm’s fee structure. Our Fee Structure from Messick & Lauer on Vimeo.
We Have Met the Enemy and It Is Us
The title character in the Pogo comic strip once uttered the now famous line, “We have met the enemy and it is us.” He could have been talking about credit unions. There are many external threats to the industry (e.g., threat of taxation, diminishing margin spreads, excessive regulation) but the real threat is our inability […]
The Evolution of the Credit Union Model – Why Collaboration is Necessary
Sometimes things are so clear that they are almost self-evident. For credit unions it is clear that the credit union business model is transforming in front of our eyes. For most of the 20th Century consumer financial services were offered on a local scale by community banks and credit unions. There was a simple set […]
Cooperative CUSOs – Relationship Advice for Credit Unions Interested in Dating, Getting Married and Getting Divorced
There is a lot of interest in cooperative CUSOs these days, CUSOs that are owned by multiple credit unions. Most of these CUSOs provide operational services which can significantly reduce operating costs while increasing operational efficiencies. Some cooperative CUSOs provide non-traditional financial services which drive alternative revenue streams and offer valuable services to members. The […]
Comment Letter to Reg Flex Rule
February 27, 2012 Mary Rupp, Esquire Secretary of the Board National Credit Union Administration 1775 Duke Street Alexandria,VA 22314-3428 Re: Proposed Amendments to 12 CFR Parts 742 Pertaining to the Regulatory Flexibility Program Dear Ms. Rupp: My comment is not in opposition to the proposed changes to the Regulatory Flexibility Program. My comment is to […]
Messick & Lauer Comment Letter to the Loan Participation Amendment Proposal
THIS IS THE COMMENT LETTER SUBMITTED BY MESSICK & LAUER P.C. COMMENTS ARE DUE BY FEBRUARY 21, 2012. January 25, 2012 Mary Rupp, Esquire Secretary of the Board National Credit Union Administration 1775 Duke Street Alexandria,VA 22314-3428 Re: Proposed Amendments to 12 CFR Parts 701 and 741 Pertaining to Loan Participations Dear […]
The Risk of Doing Nothing
We are at a critical juncture in the history of credit unions. Negative events seem to be piling up on us. There is enough denial, over-reaction, semi-panic, and name calling to fill our days. It is time for all of us to take a deep breath, reflect and consider where our behavior is leading credit […]
Loan Participations: The Industry Perspective
Loan participations are extensively used by credit unions, principally in member business loans and consumer mortgage loans. Loan participations provide an attractive investment alternative and help credit unions manage liquidity, lending risk and regulatory constraints. However, the loan participation regulation needs to be amended to keep up with the changing financial marketplace. In today’s environment, […]
Loan Participations: Mitigating the Risks
The advantages of loan participations to an originating/seller credit union are that the seller obtains liquidity to serve other members, has a tool to manage regulatory loan caps and spreads its lending risks. The advantage of loan participations to a buying credit union is the ability to earn a good return on assets. Getting a […]
Due Diligence and CUSO Relationships
There was a day when credit unions relied on internal staff to perform most of their member services and backroom operations. This “internal model” has evolved into a “blended model,” where many functions are outsourced to third-party service providers, often to credit union service organizations (CUSOs). The National Credit Union Administration (NCUA) announced last year […]
Corporate CU Network Fallout Reveals CUSO Opportunities
What has the diminished role of corporate credit unions meant for CUSOs of natural person credit unions? The answer is some challenges but lots of opportunities. Some CUSOs benefited from corporate credit unions as investors and lenders. However, the loss of the corporate credit unions as a capital and liquidity source is not of great […]
Collaboration 3.0 – The Integrated Network CUSO – The Next Generation of CUSOs
Collaborations, through CUSOs and otherwise, hold the promise of earning non-interest income from non-traditional financial products and of significantly reducing operating costs. Both opportunities are welcomed in an industry where the average net interest income is less than the costs of running a credit union. If collaborations are not extensively used by credit unions, the […]
Letting Go of Our Myths
The stories we tell ourselves frame how we view the world, our place in it and how we respond to it. I call this internal viewpoint our myths, our prisms that interpret the world. The myths we create for ourselves have a profound impact on our ability to recognize and respond to change. The prism […]
Bellco UBIT Case Victory
Judge Christine M. Arguello has issued her decision in Bellco Credit Union versus the United States of America. This is one of the UBIT cases. The IRS assessed Bellco Unrelated Business Income Tax (“UBIT”) on certain income items and Bellco paid the tax and has sued for a refund. By doing so, Bellco is able […]
To Aid Innovation, NCUA Should Provide for CUSO Pilot Programs
To Aid Innovation, NCUA Should Provide for CUSO Pilot Programs 3/11/2009 ShareThisPrint This Article Larger Text Smaller Text These unprecedented times create an opportunity for credit unions to flourish in the coming decades if we harness the power of collaboration and pair that with innovation to meet the needs of consumers. In the last period […]
CUSOs Move From Collaborations to Collaborating
We really are fortunate to be working in an industry where collaboration and sharing of ideas are still prevalent. During the first part of my career in the brokerage world, it seemed like collaboration was the negotiation of a settlement after one firm pirated another’s top producer or back office personnel. In that business of […]
Not All Credit Cards Are Bad For You, Try One From A Credit Union By Tim Westrich
Go to http://feeds.feedburner.com/~r/qvisory/blog/~3/427629287/not-all-credit-cards-are-bad-for-you-try-one-from-a-credit-union to read the entire article.
Need for More Regulatory Compliance CUSOs Intensifies
OVERLAND PARK, Kan. As credit unions continue to keep up to speed on complying with new regulations, doing so may spawn the growth of CUSOs that specialize in regulatory compliance. Mike Hales, partner with Rochdale Group Inc., a consultation services CUSO, predicts that the industry will move more in that direction, a shift that may […]
Wall Street Journal Columnist Directs Public to Credit Unions
NEW YORK The Wall Street Journal online columnist Brett Arends explained in his column last week that credit unions often offer better rates than banks. Arends addressed the issue that currently many Americans are unhappy with the banking industry and suggested that they look at credit unions as an alternative. Theyre often seen as the […]
Treasury Would Take Away ‘Hedge Against Unchecked Greed’
Treasury Would Take Away ‘Hedge Against Unchecked Greed’ March 31, 2008 By Michelle Samaad NEWPORT BEACH, Calif. – NACUSO is concerned that the Treasury Department’s regulatory agency overhaul proposal would not only do away with the credit union model but eliminate the movement’s “greatest hedge against unchecked greed.” Read more about this important development by […]
Credit Unions Buy Payday Lenders in Southern California
Wescom Credit Union purchased Area Check Cashing Centers in June 2007 for $3.9 million. Kinecta Federal Credit Union purchased Nix Check Cashing in August 2007 for $45 million. Nix has 55 locations that were converted to Kinecta branches. The payday lenders are held as CUSOs. Kinecta plans to convert the customers of Nix to credit […]
Credit Unions: Where Membership Matters
Great slogan; too bad we cannot prove it. Many members refer to their credit union as their bank and themselves as customers. Most members could not care less about the credit union organizational structure. In the post-Internet world there are many large, well-financed financial service competitors that beat credit unions on price and convenience. If […]
Title Insurance Agency CUSOs
Reasons to Form a Title Insurance Agency CUSO People often ask me what a good business is for CUSOs. My reply always includes title insurance agency CUSOs. The reasons are as follows: Title insurance is a necessary part of many mortgage loan transactions. If your credit union is doing mortgage lending, you have a built […]
UBIT News
In April 2007, the IRS issued Technical Advice Memorandum (“TAMs) to selected state chartered credit unions in Alabama, Connecticut and Colorado. The IRS claimed that UBIT is due for AD&D, group life, dental, health and cancer insurance, car buying services and sale of car warranties, GAP, credit disability and financial management services. ATM interchange fees […]
Managing Risks in Investment Programs
Credit unions manage risk all the time: asset – liability risk, regulatory risk, operational risk, employee liability risk, and reputation risk. That is the nature of a financial institution. When credit unions decide to offer investment services to members, it is simply a matter of understanding how to manage a different set of risks. There […]
Collaboration: Key To Credit Union Survival
Credit unions today face a finite set of choices. They must grow to survive. Growth brings efficiencies and resources that enable credit unions to successfully compete in the financial services marketplace. Members won’t wait days for a loan decision from their credit union when the bank provides an answer in thirty minutes. Without greater efficiencies […]
NCUA Regulation Changes – Interagency Guidance on Nontraditional Mortgage Products
The National Credit Union Administration (the “NCUA”), along with several other Federal Regulatory Agencies, released a new proposal for monitoring and controlling nontraditional mortgages. The NCUA is becoming increasingly concerned about credit risks without proper control. Twice in December 2005 the NCUA has released proposals for limiting these risks – (1) “Third-Party Servicing of Indirect […]
Managing Service Provider Relationships
Credit unions are under pressure by their members to provide a variety of financial services. Credit unions are also under pressure to deliver operational services more efficiently and effectively. The solution to these pressures often involves selecting third party service providers to deliver the services the credit union either cannot provide or provide as efficiently […]
Videos
Videos related to CUSOs, credit unions and compliance issues.
Client Corner – CU Rise Analytics
Messick Lauer & Smith PC continues its semi-regular Webinar series. This Client Corner features CU Rise Analytics. Learn more about how CU Rise Analytics is helping credit unions to provide superior member service. Here is the link to this webinar: https://vimeo.com/478186485 For more information regarding CU Rise Analytics and their services, please visit their website: […]
CU Crossroads – Brian Lauer, Partner at Messick Lauer & Smith P.C.
The next guest on CU Crossroads- 5 Question Series was Brian Lauer, Partner at Messick Lauer & Smith P.C. The topic of discussion with him was ‘Changes in Focus of Credit Unions and CUSOs’. Below are the takeaways from his interview: One of the key changes that many CUSOs are adjusting to during the pandemic […]
Client Corner – DoubleCheck Solutions, LLC
Messick Lauer & Smith PC continues its semi-regular Webinar series. This Client Corner features DoubleCheck Solutions, LLC. Learn more about how DoubleCheck Solutions, LLC is helping credit unions to provide superior member service. Here is the link to this webinar: https://vimeo.com/459107418 For more information regarding DoubleCheck Solutions, LLC and their services, please visit their website […]
Promoting Credit Unions As A Whole To The Small Business and Real Estate Investor Community
Mark Ritter, CEO of MBFS is on an initiative to promote credit unions as a whole to the small business and real estate investor community. Below is a link below to a recent interview he did as part of this effort. https://www.stitcher.com/podcast/the-business-credit-and-financing-show/e/62754794?autoplay=true
CUSO 101 – CUSO Basics – Video
This is a 5:38 minute presentation on the basic rules of CUSO organization for those who are new to CUSOs. CUSO Basics from Messick & Lauer on Vimeo.
Writing an Effective Comment Letter – Video
This is a 5:27 minute presentation on how to write effective comment letters to proposed regulatory changes. Writing an Effective Comment Letter from Messick & Lauer on Vimeo.
Why Collaborate – Video
This is a 6:45 minute presentation on why credit unions should consider collaboration and CUSOs as part of their business model. Why Collaborate from Messick & Lauer on Vimeo.
Structuring Multi-Owned CUSOs – Video
This is a 5:19 minute presentation on the considerations in organizing and operating a CUSO owned by multiple credit unions. Multi-Owned CUSOs from Messick & Lauer on Vimeo.
Protection of the CUSO Corporate Veil – Video
This is a 5:32 minute presentation on the considerations in protecting the CUSO’s corporate veil so that an error in the CUSO does not adversely affect the credit union owners. Protection of the CUSO Corporate Veil from Messick & Lauer on Vimeo.
Our Services – Video
This is a 3:06 minute presentation of the services provided by Messick & Lauer P.C. Our Services from Messick & Lauer on Vimeo.
Managing Risks in Investment Services – Video
This is a 4:40 minute presentation on managing the credit union’s risks in providing investment services. Managing Risks In Investment Services from Messick & Lauer on Vimeo.
How to Begin to Collaborate – Video
This is a 5:06 minute presentation on how credit unions can begin the process of collaboration and using CUSOs.
Generating Net Income – Video
This is a 5:29 minute presentation on how CUSOs can help generate more net income for credit unions through additional revenue sources and reduction of operational costs. Generating Net Income from Messick & Lauer on Vimeo.
Expanding CUSO Ownership – Video
This is a 6:36 minute presentation on the process of adding new owners for your CUSO to meet your objectives. Expanding CUSO Ownership from Messick & Lauer on Vimeo.
Credit Union Merger Agreements – Video
This is 6:32 minute presentation on the credit union merger process, including the agreements and due diligence. Credit Union Merger Agreements from Messick & Lauer on Vimeo.
Our Fee Structure – Video
This is a 1:36 minute presentation on the Firm’s fee structure. Our Fee Structure from Messick & Lauer on Vimeo.
Webinars
Webinars related to CUSOs, credit unions and compliance issues.
Compliance in Marketing, Advertising and Social Media
Intro: 0:00-1:20 Advertising Rules and Regulations: 1:20-7:15 Social Media Platform Rules: 7:15-34:35 Advertising/Social Media Best Practices: 34:35-56:46
Financial Innovation – Loan Participation and Eligible Obligations Webinar
The NCUA’s new Financial Innovation Rule offers credit unions new and exciting lending opportunities. However, with these new and exciting opportunities come more responsibility on credit unions to reassess, strengthen and update their loan purchasing and lending policies and procedures. This webinar goes into detail about what changes were made to the NCUA’s loan participation […]
Third Party Relationships
Third party relationships can present great opportunities to credit unions to meet their strategic goals and to expand member services in an increasingly competitive marketplace. However, these opportunities must be properly evaluated, with risks assessed and adequately mitigated. This webinar reviews the NCUA’s supervisory guidance as to how credit unions should evaluate their third party […]
CUSO 101
This is an introductory webinar to credit union service organizations (CUSO). The webinar discusses regulatory requirements governing the formation of CUSOs, business considerations you should consider prior to creating a CUSO, and the documents you will need to form a CUSO. If you have any questions about the webinar or the CUSO formation process itself, […]
Client Corner: LenderClose
Messick Lauer & Smith PC continues its semi-regular Webinar series. This Client Corner features LenderClose. Learn more about how LenderClose is helping credit unions to provide superior member service. Here is the link to this video: https://vimeo.com/436912700 For more information regarding LenderClose and their services, please visit their website www.lenderclose.com
Client Corner: POSH – Conversational AI for Credit Unions
Messick Lauer & Smith P.C. will be running semi-regular webinars introducing clients to our other clients. It is a chance to spread the word about great products and services offered by CUSOs to the credit union industry. We are starting with Posh, a conversational AI provider. Here is a link to the recording of this […]
Why Credit Unions Are “Investing In” Fintech Today?
https://attendee.gotowebinar.com/recording/4453736074064474371
How to Keep Innovation Flowing – CUSOs, Startups, and Equity Options Copy
CUSOs are investing in startups and fintech to add innovative services and products in a dynamic financial services industry. The success of these organizations rests on talented individuals who often come from the for-profit world and have different motivators than those in the traditional, non-profit credit union model. In order to maximize the value of […]
The Equifax Breach and Credit Union Involvement
The Equifax breach has resulted in a landslide of opinions, articles and media coverage. While the wealth of information is helpful, talking about what the breach may mean specifically for credit unions is critical. This webinar will provide a base for ongoing discussions relating to future CU impact due to regulatory and legislative changes. Slide […]
Comprehensive Credit Risk Management at Credit Unions
The process of taking a loan from application to funding is important but it is only 50% of the job of lending. The other 50% is portfolio management which means managing the ongoing risk in the portfolio to assure that loans are repaid and losses are controlled. To do this, credit unions must employ tools […]
The New HMDA Rule – What you Need to Know
Let us read the hundreds of pages of final rule so you don’t have to. This presentation will provide an overview of the new HMDA rule and will discuss aspects of the rule that apply specifically to mortgage CUSOs and the credit unions that work with them. The New HMDA Rule – What you Need […]
Responsible and Profitable Banking of MSB and MRB Clients
Below is a link to a webinar presented by Hypur, Inc. Guy Messick, general counsel for NACUSO, had the pleasure of introducing Hypur and their presentation.
How do Credit Unions Begin the Process of Collaboration?
This presentation is for credit unions that know they need to consider CUSOs and collaborative solutions but do not know how to get started. How Do Credit Unions Begin the Process of Collaboration? from Messick Lauer & Smith P.C. on Vimeo.
CUSO Reviews: How to Get Ready.
Messick & Lauer P.C. host this webinar regarding CUSO reviews. The NCUA CUSO Registry re-opened for CUSOs to reaffirm the data submitted to the NCUA last year. From here on out, this reaffirmation will be done annually. The question is what will the NCUA do with this data. The likely answer is prioritize reviews (examinations) […]
Sound Vendor Management
Messick & Lauer P.C., in conjunction with The Rochdale Paragon Group, hosted a webinar to provide credit unions and CUSOs an overview of the importance of developing a sound vendor management program in today’s increasingly complex regulatory environment. Sound Vendor Management from Messick & Lauer on Vimeo.
Regulatory Developments & CFPB Update
This webinar focused on recent regulatory and legal trends, supervisory highlights, and updates on recent enforcement actions to help credit unions and CUSOs be prepared for the upcoming year. Regulatory Developments and CFPB Update from Messick & Lauer on Vimeo.
Tools to Enhance Cyber Security for Credit Unions
This is a webinar presentation by ViClarity, an international technology firm serving financial institutions. ViClarity- Tools to Enhance Cyber Security for Credit Union from Messick & Lauer on Vimeo.
Countdown to the New MBL World
The revised Member Business Lending Rule takes full effect on January 1. The revisions are substantial and introduce a completely new regulatory framework. This is a high level discussion of what to expect and how to prepare for the changes. Countdown to the New MBL World from Messick & Lauer on Vimeo.
Insurance Services: An Opportunity for Credit Union Growth
The insurance industry presents a unique opportunity for credit unions to grow strategically. Insurance is not only a way to add value for members, but also presents a source of non-interest income. Chances are your members have some type of insurance, whether its healthcare, auto, property, or life and if they’re not getting these services […]
CUSO 101 – The Organization and Operation of CUSOs
CUSO 101 from Messick & Lauer on Vimeo.
Cybersecurity and Data Breaches – How to Prepare, Protect and Respond
Cybersecurity and Data Breaches – How to Prepare, Protect, and Respond from Messick & Lauer on Vimeo.