Credit Union News Takes an Exciting New Turn.
Journalists are generally a miserable lot. In our spare time, we like to complain.
My stream of critical consciousness generally goes something like this.
"Nothing new ever happens in credit unions. Another effort to save the tax exemption? No thank you. Another bill introduced in Congress? I can't wait to watch it go nowhere. The Fed Fund rate is going up? Sure it is. Don't hold your breath. Credit unions don't like the NCUA's latest proposed rule? That ain't news. Oh goody, another feature about millennials and how to helicopter parent them as financial services providers. I can't wait to read that."
In celebrating our 25th anniversary, we discovered that so many credit union issues are perennials my internal curmudgeon felt justified. Some weeks I struggle to find a topic worthy of a weekly column and your valuable time.
The past two weeks, however, have been an exception.
First was NAFCU's disruptive move expanding membership eligibility to all federally insured credit unions. This was not totally unexpected; like a single-sponsor credit union, once an organization has maxed out its existing market, it can only grow by expanding it. Chairman Ed Templeton, president/CEO of the $721 million SRPFCU, told us that the trade has been considering this move intermittently for at least a decade. Knowing that, the only head scratcher was why it took so long.
But timing is everything, and with CUNA appearing to spin its wheels on the evolutionary highway, this year was the right time. NAFCU has already gained new state-chartered credit union members, and some of them are large ones, well within the trade's sweet spot of $250 million and up.
Will CUNA answer? I hope so. The industry's larger and older trade has traditionally matched its competitor's move. While I was surprised CUNA had no immediate response prepared when NAFCU made its big announcement -- surely they weren't caught by surprise -- I'm eagerly anticipating a big CUNA unveiling at America's Credit Union Conference next week in Denver.
I'm sure credit union executives are, too. Could this bellyacher be so lucky to have two thrilling annual trade conferences in the same year? Like my hero J. Jonah Jameson, publisher/editor-in-chief of the fictional Daily Bugle, said in "Spiderman 2," "Rumors! Gossip! Panic in the streets -- if we're lucky."
Some have said NAFCU's move will mean the end of NASCUS. I'm not sure I buy that argument. I've never seen NAFCU address NASCUS' primary focus of state regulators, even on a federal level, such as when federal regulators encroach upon state regulatory rights. In fact, NAFCU made it clear they have no interest in addressing state issues. Furthermore, new NASCUS CEO Lucy Ito seems like she will take the trade association in a bold and aggressive new direction.
Yes, we journalists are a miserable bunch. But according to CUTimes.com stats, our readers can't get enough of the Alabama One Credit Union saga. Rubbernecking is the word that comes to mind.
Until this week, most of our coverage had sourced the members who had filed suits against the credit union and associates of incarcerated check kiter Danny Ray Butler. Some days, they have made our pages more colorful than the New York Daily News. The good ol' boy nicknames, astonishing tales of corruption and even sex pumped up the excitement well beyond the standard NCUA and trade drivel.
But then just a few days ago, we were treated to something even more exciting: A lawsuit from Alabama One alleging a conspiracy that involves the governor's office and controversial Alabama Credit Union Administration Administrator Sarah Moore, who landed the job after her bank failed.
I've been watching a lot of "Scandal" lately, and while there doesn't seem to be any sign of the CIA's shadowy B613 unit -- yet -- this subplot juiced up a story I thought had been mostly squeezed already.
We were even gifted with a lengthy interview with Alabama One CEO John Dee Carruth, who adamantly denied the accusations made by Butler and his cohorts that the credit union was complicit in his fraud and confirmed the conspiracy accusations in Alabama One's lawsuit.
Elements of truth pepper both sides of this story, but there are also claims that make my reporter's third eye light up.
For example, Danny Ray Butler is no dummy. I have a hard time believing a man with a 9th grade education who rose to become a successful business man making multi-million dollar development deals could be so easily become a patsy. He may play the slack-jawed yokel role well, but I know from experience country folk can be every bit as wily as city slickers.
On the other side, I struggle to understand how a sophisticated, $600 million credit union could inadvertently -- Alabama One's term -- allow a member to borrow several million dollars above his member business lending cap, as the credit union claimed in its lawsuit. Inadvertently isn't flattering; it suggests the credit union is poorly managed.
We hammered Carruth on this question, and he said the problem was a disagreement between the ACUA and NCUA over how to aggregate MBLs. While I had heard that tip a few months ago, that doesn't sound inadvertent. That sounds like a child who doesn't like mom's answer and then asks dad.
One thing is certain: I can't wait to see what happens next.
It almost, I dare say, puts a smile on my face.