GLENDALE, Calif. — Glendale Area Schools FCU has removed a controversial ad from its website several weeks after NCUA asked it to do so. But the CU said the ad had already accomplished its mission.
After NCUA Regional Director Melinda Love wrote to Glendale Area Schools FCU CEO Stuart Perlitsh asking him to "work toward a common goal of a safe and secure financial industry for the entire nation" by removing an advertisement first seen the credit union's Winter 2009 Insider member newsletter, Perlitsh complied.
The ad asked members to consider how safe their money is by showing rankings put together by bankrate.com, which lists Glendale Area Schools FCU as a "five star" financial institution while failed big banks like IndyMac and Washington Mutual were given only one star, as was a fellow cooperative WESCOM. Telsis Community Credit Union and SchoolsFirst FCU were listed as two and three star institutions.
But don't count the action as a victory for NCUA just yet. Perlitsh said he removed the ad because the credit union's server could not handle all the traffic it was receiving after news of the controversy hit the media.
"We've had more hits on that website since we put it up in 2000 and it was slowing down our server. We've been flooded with hits to that because of your publication so we took it down," he said. "My e-mail box is full of CEO correspondence encouraging me to keep it up. But we're working on building up our server now because I can't wait to put up my next newsletter."
After speaking with NCUA again on Feb. 27 the determination was made that the ad would be removed from the website. Perlitsh said there was no reason to risk irking the regulator further when the ad had already clearly served its purpose.
"To be humble, 'mission accomplished,'" he added. "We could not have purchased this kind of advertising."
NCUA spokeswoman Cherie Umbel said the regulators ad rules require "all advertisements by federally insured credit unions be accurate and cannot be deceptive or misleading. If NCUA determines a credit union is violating a regulation, it can require compliance or impose penalties." She did not say if the Glendale ad violated those regulations.
How NCUA found out about the insider advertisement remains unclear. WESCOM refused to comment and Telsis Community Credit Union did not respond to Credit Union Journal inquiries. SchoolsFirst FCU VP-Marketing Derek Longshore told Credit Union Journal the institition was aware of the ad and chalked up its knowledge to information sharing in the cooperative movement, but added that they "did not forward the information to the NCUA."
"At SchoolsFirst FCU we stand by our mission and vision and believe that our reputation speaks for itself. Our members know our character and we found no need to neither validate nor deny the statements," he added. "We measure our success by the loyalty of our members and don't compare ourselves to other institutions, but only by our members satisfaction with their credit union."
