The CU Journal Daily
Navy FCU In Wrongful Death Suit
DURHAM, N.C.-Convicted wife-killer Michael Peterson's stepdaughter claims Navy FCU should have known Peterson had been charged with murdering her mother when it loaned him $75,000 to finance his legal defense, and therefore has no right to foreclose on the loan now.
In a civil suit filed last week, Caitlin Atwater is citing a state law that says she is entitled to half of the assets belonging to Peterson, convicted last October of murdering his wife, Kathleen Peterson. Atwater claims her right to half of Peterson's property, under state law, would be violated if the credit union is allowed to forceclose on the house.
Peterson was charged with his wife's murder in the fall of 2001 and obtained the loan from the credit union in June 2002. He has since filed for bankruptcy. The credit union has offered to compromise on the $67,000 owed, and accept $55,000 instead.
The suit is among several filed by Atwater aimed at obtaining any assets that belong to Peterson, a Durham novelist and former newspaper columnist.
She has filed a wrongful death suit and is also seeking to recover benefits paid to Peterson from his wife's/her mother's employer.
CUNA Objects To FASB Opinion
WASHINGTON-CUNA is strongly objecting to guidance from the Financial Accounting Standards Board (FASB) that would render loan participations unusable.
In a letter to the accounting standards group, CUNA called on it to not move forward with any such proposals.
FASB is currently seeking comment on its Financial Accounting Statement (FAS) 140, Accounting for Transfers and Service of Financial Assets and Extinguishments of Liabilities.
FASB has indicated it is concerned that in a loan participation, in which the borrower has shares or deposits at the originating institution, the liquidation of that institution might preclude the "loan participation" institution from recovering its pro rata portion of the members' shares/deposits within the originating institution that are "setoff."
CUNA told FASB that there are already sufficient safeguards in place to address the accounting group's concerns about isolating the loan participation asset from the reach of the originating credit union and its creditors in liquidation.
Iowa CUs Bury Hatchet With Banks
DES MOINES, Iowa-Credit unions and banks, who have waged regular warfare over taxation, laid aside their differences this year to get the state legislature to combine bills modernizing the state's credit union statute and allowing for a potential tax break for banks.
"Basically, what happened was, we agreed not to oppose their bill in exchange for them not opposing out bill," Justin Hupfer, a lobbyist for the Iowa CU League, told The Credit Union Journal.
The bill provides state credit unions parity with the federal charter in terms of permissible investments; reduces the minimum examination requirements from every 18 to 24 months; enables credit unions to apply to the state regulator for permission to have fewer than nine persons on the board of directors; and enables credit union management to suspend services to members who have caused the credit union a loss, violated board policy, or been abusive to credit union staff.
The new law, signed into law recently by Gov. Tom Vilsack, is important in the Hawkeye State where all but one of the 170 credit unions is state chartered.
NY CUs Take Aim At State Sales Tax
ALBANY, N.Y.-A bill introduced in the state Senate would repeal the state's 8.25% sales tax on purchases made by state-chartered credit unions.
The bill could save the state's 34 state charters around $2 million a year, according to Amy Kramer, chief lobbyist for the New York CU League.
"We want to make sure that the state charter is as attractive an option as the federal charter," Kramer told The Credit Union Journal. "This is a creative approach to alleviating state charters from this burden."
Separately, credit unions are trying again to get a bill passed that would allow municipalities to deposit funds with them.
Man Breaks Through Window While CU Closed, Steals Cash
MANSFIELD, Ohio-A man wearing a T-shirt around his neck used a tire-iron or crowbar to break open a window and rob Empire Affiliates Credit Union here. The amount of money stolen was undisclosed.
The credit union was closed at the time of the robbery, which was not discovered until employees arrived at work Monday. It is unknown why an alarm did not go off.
The man also tried to break into an ATM outside the credit union, but was unsuccessful.
The man, white and about 5'10" tall, was captured on video even though he used a crowbar to break the security camera.
Bad Check For Chicks
MADISON, Wis.-Police have issued a warrant for a Janesville man who allegedly wrote a bad check on First American CU to buy 45,000 baby chickens from a Missouri chicken farmer.
Steven Ward, 43, is charged with using the funds, $5,517, to make a down payment on six deliveries of chicks but the check bounced.
Police said Jim Phillips, of Stover, Mo., tried to resolve the issue with Ward but was unable to obtain payment. Ward is charged with one count of theft and one count of deceptive practices for passing a bad check.
Murder At Xerox FCU Spawns Change In Law
ROCHEESTER, N.Y.-A bill introduced in Congress would expand current law and make it a crime for anyone to misuse law enforcement uniforms, patches and other insignia in the commission of a crime.
The proposal was spurred by last August's armed robbery at Xerox FCU when a man wearing an FBI jacket and displaying a U.S. Marshall's badge robbed the credit union and shot two members, one fatally. The killer is still at large.
"We must be able to trust the uniforms and badges that identify (law enforcement officers)," said Rep. Louise Slaughter, D-N.Y., the chief sponsor of the bill.
The bill, the Badge and Uniform Security Trustworthiness Act, would expand on existing law that makes it illegal to use a genuine or counterfeit law enforcement badge for illegal purposes by replacing the word 'badge' with 'public safety officer insignia or article of clothing.'
GTE Bails Out Local Prep School
TAMPA, Fla.-GTE FCU said last week that it closed on a new $4.1 million loan that will enable Bradenton Academy, a local prepatory school, to refinance its debt and stay in business.
The refinancing enabled the family-owned school to avoid foreclosure after it defaulted on an existing loan from SunTrust Bank.
"They approached us and we took a look at it; did our due diligence," Bucky Sebastian, president of the $1.6 billion credit union, told The Credit Union Journal.
Business Lending Also Popular In Jamaica
JAMAICA-Business lending isn't just booming at credit unions in the U.S. Churches Credit Union has unveiled a new credit line called Churches Credit Union's Business Loan Facility through which businesses operated by its members, will be able to borrow up to $18 million using funds drawn from the European Union.
A new product called the "Super-Easi Loan" is available with a maximum draw-down of $1 million.
The credit union said it is targeting small and even micro-businesses. Separately, Churches Credit Union reported it has reduced its loan delinquency rate to 2.7% from 11.8% in 2002.