Credit Union Service Organization (CUSO) Formation and Growth

Credit unions need to find sources for additional net income, and CUSOs help credit unions achieve that goal. Through CUSOs, credit unions can improve their net income by generating additional interest and non-interest income as well as reducing operating expenses through economies of scale.  In addition to more net income, CUSOs provide credit unions with more control and input over services that may otherwise be outsourced to a third party vendor.

Messick Lauer & Smith has nearly 50 years of collective experience assisting credit unions start CUSOs and helping them grow. Working with our clients every step of the way through the process, we have formed hundreds of CUSOs — in all shapes and sizes. We help our clients identify opportunities to generate more net income and watch the opportunity become reality. Every reality is different and we have seen a lot of them. Therefore, we work with our clients to construct the right structure to organize, fund  and govern the business model.

Once the CUSO is formed, we understand that the work is not done. We draft service agreements and negotiate vendor agreements. We will connect and introduce clients to help find collaboration partners which drive additional business growth. Our years of experience help us to know where to turn, what may work and who is doing something similar.

We have assisted many CUSOs that expanded their ownership to add capital and clients. This process includes initial planning to determine the goals of adding more partners and determine the document revisions and action plans to achieve these goals.

Here’s a look at some of our work forming and developing CUSOs.

When it comes to using CUSOs to develop more net income for your credit union, let Messick Lauer & Smith help.

Brian Lauer
Amanda J. Smith
Mike Mulvey


Consumer Law Regulatory Compliance

The burden of consumer law regulations is time consuming and challenging. We devote our time to keeping up with the never-ending changes in the regulatory environment, so you do not have to. Our expertise is often called upon for an attorney to present at credit union meetings and national conferences. We provide ongoing advice to our clients and are always there with you to analyze an existing or potential new product or service. Credit unions and CUSOs frequently face distinctive, specific compliance challenges unique to credit unions and CUSOs. Given our vast experience within the credit union and CUSO industries, Messick Lauer & Smith can provide unique counsel to its clients addressing their specific compliance needs and concerns.

We provide guidance and expertise in a variety of difference regulatory areas, including:

  • The Equal Credit Opportunity Act (Regulation B)
  • Mortgage Disclosure Act (Regulation C)
  • Home Electronic Funds and Transfer Act (Regulation E)
  • Real Estate and Settlement Procedures Act (Regulation X)
  • Truth In Lending Act (Regulation Z)
  • Fair Debt Collection Practices Act (FDCPA)
  • Gramm-Leach-Bliley Act
  • Fair Credit Reporting Act (FCRA)
  • Truth-in-Savings Act
  • E-Sign and Uniform Electronic Transactions Act
  • Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act)
  • State Lender Licensing Laws

We keep our clients apprised of changing regulations through email updates as well as webinars. We also offer one-on-one training and counseling that is tailored to each individual credit union or CUSO. We work with our clients to plan for future compliance needs, resolve compliance issues if they arise within the institution, and to ensure that the compliance issues do not repeat.

See what we’re doing when it comes to consumer law regulatory compliance here.

Consumer law regulatory compliance can be challenging and frustrating, let Messick Lauer & Smith help.

Amanda J. Smith
Jennifer Winston


Vendor Management

Vendor management has become a very important part of credit union operations. The challenges these relationships created need a specific type of attention in order to ensure overall success. Contracts are critical; without them the relationship between credit unions and vendors can unravel.

With over 25 years of experience in the industry, Messick Lauer & Smith has seen many vendor agreements and understand which terms are critical to a credit union in the management of the vendor relationship. This experience and familiarity allows us to efficiently and effectively review vendor agreements. In fact, some vendors know us so well they have the Messick Lauer & Smith version with all our customary requested changes. We understand that business is enhanced by a sound contracting process.

Of course, contract review and negotiations are only part of the equation. Because we value vendor management as an important part of a credit union’s success, we work closely with a consulting firm and software company to provide the tools and advice our clients need to manage their vendors. Our goal for our clients does not end at just managing relationships. The process of vendor management yields valuable information. We help our clients leverage the information to make better operational and strategic decisions.

Learn more about what we’ve done when it comes to vendor management.

The power of vendor management is gathering, analyzing and leveraging knowledge to inform a credit union’s strategic vision, let Messick Lauer & Smith help.

Brian Lauer
Mike Heller


Regulatory Advocacy

Credit unions live in a highly regulated environment where issues may arise. Our clients turn to us to find resolution with a regulator.

Messick Lauer & Smith interacts frequently with the National Credit Union Administration and state credit union regulators, in efforts to shape regulations and policies. We have spoken at conferences sponsored by National Credit Union Administration and National Association or State Credit Union Supervisors. We have also worked with Congress, state insurance regulators and the Securities and Exchange Commission. We believe that we have forged good working relationships with the regulators and are able to advocate before them with credibility.

We have helped credit union and CUSO clients vet new ideas with regulators so as not to run into issues when implemented. We have advised clients when faced with the examination and supervisory issues. No matter what the challenge, we know we can help you plot the best course of action when it comes to interacting with regulators.

Advocacy does not stop with direct communication with the regulators. An important part of advocacy is staying abreast of the new and amended regulations and drafting official comments to the proposed regulations. We work with our clients and industry groups to forge the best responses to and arguments for or against proposed regulations.

Find out more about what we’re doing as regulatory advisors.

Make sure your voice will be heard when regulatory issues arise, let Messick Lauer & Smith help.

Brian Lauer
Amanda J. Smith


Lending and Loan Participations

Meeting member lending needs is the core service of credit unions. Credit unions and CUSOs are called upon to be experts in direct lending, indirect lending and lending from mobile platforms. In order to manage the credit and liquidity risks, credit unions must master loan participations, the secondary market, and the sale and purchase of whole loans to and from other financial institutions. Overlay those issues with the increasing regulatory burden and the complexity of providing compliant and effective lending services is daunting.

Messick Lauer & Smith provides guidance to assist credit unions with their lending related issues, including particular knowledge on the regulatory issues of residential mortgage lending, indirect lending, member business lending, credit card lending, auto lending, loan participations and the sale of eligible obligations.

Learn more about what we’re doing to help credit unions and CUSOs with their lending needs.

Don’t get caught without a solution for your lending challenges, let Messick Lauer & Smith help.

Brian Lauer
Amanda J. Smith


Strategic Planning

Everyone needs a plan for the future, both for next week, and the next five years. Without one, a business can get lost within the industry.

With over 25 years of experience representing credit unions, CUSOs and NACUSO, we have been privileged to be in the forefront of many innovations in the credit union industry and we have participated in forming more CUSOs than any other law firm. We work with some of the most innovative people in the credit union and CUSO industry. Industry insiders, including NCUA, often call us to learn what is new in the CUSO world. Some clients primarily retain us for our industry knowledge. Credit union and CUSO clients ask us to present and/or moderate at strategic planning meetings.

Find out what we’re doing to help CUSOs and credit unions with their strategic planning.

Sound strategy for your business now — and in the future, let Messick Lauer & Smith help.

Brian Lauer
Amanda J. Smith