Manager Commits Suicide After Possible Theft
CHICAGO-Authorities are investigating the books of two tiny CUs after their manager left a suicide note confessing to stealing thousands of dollars from one of them. Walter Feulner, 65, was found by his wife last week, hanged by an electrical cord in his garage. A note he left indicated he was consumed by guilt because he had stolen cash from the Chicago Transit Authority's South Shop CU, an $800,000 CU he managed. Authorities are also investigating another tiny credit union he managed, and School District 123 CU. Feulner's wife said she was unaware of any fraud but said Feulner had been "very stressed" since she was diagnosed with ovarian cancer last year. She had no health insurance and the couple incurred medical expenses of more than $100,000, which they were struggling to pay, she said.
CUs Announce Dividends To Demonstrate Difference
LANCASTER, S.C.-Even as Congress was debating a $700-billion bailout for the financial markets, some credit unions have sought to leverage the news by announcing special dividends. Founders FCU here said it is returning $6 million to its membership in the form of a bonus dividend. "The incredible support we have received from our members has allowed us to declare a bonus dividend," said Bruce Brumfield, CEO of Founders, adding FFCU has paid such bonuses in five of the last eight years.
Meanwhile, in Tullahoma, Tenn., Ascend FCU announced it will pay an $8-million bonus dividend effective with November statements. AFCU made the announcement earlier than usual in an effort to point up the credit union difference and allay any member fears about the safety and soundness of the CU, Ascend said.That brings the total returned to members over the past four years to more than $18 million.
"As we continue to hear about multi-billion dollar bankruptcies and mortgage failures, I am thankful for Ascend's solid financial condition," Ascend President and CEO Caren Gabriel said.
The return will be calculated as a percentage of total year-to-date dividends, including IRAs, and total year-to-date interest paid on all loans. The period covered will be Jan. 1 through Nov. 30, 2008, with a target grand total of $8 million credit union-wide.
As in previous years, the bonus dividend and loan interest refund represent a member's relationship with the credit union. The more savings a member has, the higher his bonus dividend, and the more loans he has, the larger his loan interest refund.
Trades Press NCUA On Merger Acctg.
WASHINGTON-The trade groups continue to push NCUA for further refinement of the definition of post-merger net worth. At issue is a 2001 decision by the Financial Accounting Standards Board (FASB) that required credit unions and others to forego the use of the pooling method pooling method of accounting in mergers and instead follow the acquisition method that goes into effect after 2008.
Under the acquisition method, the value of assets acquired in a merger have to be reflected as an addition to equity, not as an addition to retained earnings, as they are under the pooling method, meaning that in a merger of two credit unions, not only would the acquiring credit union not be able to include the retained earnings of the merging credit union in its net worth, but the net worth ratio of the acquiring credit union would likely decline. Earlier this year NCUA proposed changes to its PCA rule that would implement the statutory provisions to allow the net worth ratio of an acquiring credit union, following a merger, to reflect the acquired retained earnings of the merging credit unions. The proposal would also make parallel changes for corporate credit unions.
Members Talk Bank Merger
AUGUSTA, Maine-Management at Kennebec Valley FCU here met with members last week to further explain why the CU is seeking to vote with a local savings bank.
Members are to vote on the merger with Kennebec Savings Bank, which has a mutual charter, on Oct. 14. But some in the community have voiced opposition, with a number of letters to the editor questioning the decision appearing in local publications, and members organized at least one meeting to discuss how to fight the merger.
The Maine CU League also indicated its opposition to the merger, and told CU Journal in September that it will try to dissuade the $51- million credit union's board against it. "The league believes that the credit union charter is still the best option for consumers," league president John Murphy said. "We would like to see the credit union remain a credit union."(c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.http://www.cujournal.com/ http://www.sourcemedia.com/
