CUNA HELPS SAVE KEY HOUSE MEMBER IN PRIMARY RACE
BIRMINGHAM, Ala.-An independent radio campaign by CUNA boosting Congressman Spencer Bachus in the three days leading up to the Alabama primary election helped the ten-term member of Congress and chairman of the House Financial Services Committee survive his toughest primary race last week.
Bachus, head of the key committee over credit union and bank legislation, was facing a Tea Party-backed challenge from state Sen. Scott Beason and financial backing from an out-of-state Super PAC known as Campaign for Primary Accountability which was successful just last week in helping unseat Republican incumbent Jean Schmidt in an Ohio primary. Beason gained nationwide attention for sponsoring Alabama's toughest-in-the-nation law against illegal immigration.
Bachus, 64, won 59% of the vote in the four-person primary, allowing him to avoid a run-off if he failed to win 50%.
The primary win, which virtually guarantees a victory in the general election, came after Bachus was heavily criticized for his support of the bank bailout bill, known as TARP, and for allegations he profited from inside information learned during his work as a congressman.
The final days of the primary saw the major financial interests before the Financial Services Committee pour PAC contributions into the Bachus campaign, including Bank of America, US Bancorp, Citigroup, BB&T, Fifth Third Bancorp, American Bankers Association, Barclay's Group, National Pawnbrokers Association ACE Cash, Discover Financial and others, but all of the contributions were of less than $2,500 and paled in comparison to the three-day radio campaign paid for by CUNA independently of the Bachus campaign.
"Congressman Bachus has an understanding of credit unions and has been a long-time supporter," said Richard Gose, chief campaign strategist for CUNA, in explaining the independent initiative.
Bachus has had an off-and-on relationship with credit unions during his congressional career. He was one of only a handful of House members to vote against HR 1151, the landmark 1998 CU Membership Access Act in the overwhelming 411-to-6 passage of the bill. But since then he has become a strong credit union supporter and helped to push several key legislative initiatives. His support in moving the proposed member business loan bill this year is critical.
CUNA spent $28,000 on the radio spots, which blanketed the Birmingham and Tuscaloosa markets and part of Montgomery in the state's Sixth District.
The spots said nothing about credit unions, but "Spencer Bachus is standing up for us when it comes to reducing taxes, downsizing government and providing us more freedom. That's why Spencer Bachus has earned a ninety two percent rating from the American Conservative Union. In fact, according to Spencer Bachus's lifetime ratings with ACU, he is the most conservative member of the Alabama delegation...Spencer Bachus... he's standing up for us."
Under federal election rules, independent expenditures such as this one cannot be coordinated with a candidate or the candidate's campaign. CUNA has spent far more on previous independent expenditures, but this one is important because of the role Bachus will play in any CU legislation this year-like the member business loan bill-even as he has promised to step down as chairman of the Financial Services Committee next term if reelected.
NCUA SETTLES WITH SECOND EXECUTIVE FROM WESCORP
LOS ANGELES-NCUA agreed last week to settle civil negligence charges against a second WesCorp FCU executive for the 2009 failure of the one-time $32-billion corporate credit union, Robert Burrell, who was Wes-Corp's chief investment officer.
As part of the settlement Burrell is expected to consent to a prohibition order barring him from working for any federally insured CU.
Burrell's deal follows last week's settlement with Timothy Sidley, who was WesCorp's chief risk officer, and leaves three defendants in the case: Robert Siravo, who was CEO; Todd Lane, CFP; and Thomas Swedberg, human resources director.
NCUA stands to gain little in the way of financial compensation in any of the cases because it allowed the insurance to lapse after taking WesCorp under conservatorship in March 2009. The question of whether NCUA is responsible for the defendants' legal fees under a prior directors' and officers' liability policy with CUNA Mutual Group's CUMIS Insurance Society is still being litigated.
NCUA's attorney in the case Jeff Wexler told Judge George Wu during a hearing last week the agency is continuing to negotiate a settlement with Siravo and Swedberg.
Lane's attorney said he is no longer negotiating a settlement and expects his client to be vindicated with a summary judgment in his favor. "I think Todd Lane will get summary judgment," Kenneth Fitzgerald, a Los Angeles lawyer representing the WesCorp figure, told the Credit Union Journal. "Judge Wu expressed doubt of the merits of the charges against Lane."
NCUA filed a civil suit in U.S. District Court for the Central District of California in March 2010 alleging gross negligence on the part of officers and directors of WesCorp for loading the corporate up with risky mortgage backed-securities, which eventually caused its demise. The court dismissed charges against the directors last year.
