DALLAS – Southwest Corporate FCU, which abandoned plans to combine with Southeast Corporate FCU in Florida, has agreed this time to merge with Northwest Corporate FCU, which serves 250 credit unions on the west coast. The deal will create a national corporate with almost $12 billion in assets, serving some 1,500 credit unions. As a sweetener to the deal, Northwest, based in Portland, Ore., will place $1 million each in the state credit union foundations in Oregon and Washington, subject to NCUA approval. Southwest Corporate, which serves mainly credit unions in the southwest, had planned to merge with Southeast Corporate but the two abandoned those plans last September. Southwest is by far the bigger corporate, with more than $11 billion in assets and 1,250 member credit unions, while Northwest claims about $900 million in assets and 250 members.

WASHINGTON – Pentagon FCU was awarded a $1.5 million grant to help it expand an innovative payday loan it is providing soldiers returning from Iraq and Afghanistan, the credit union announced yesterday. The funding from the Iraq Afghanistan Deployment Impact Fund of the private California Community Foundation will help Pentagon extend its Asset Recovery Kit, or ARK, to other defense credit unions, according to Mary Lynn Stevens, spokesman for Pentagon FCU. Under the program, credit union members are eligible for a short-term payday loan for a $6 fee and no interest. To be eligible for a second loan the members must agree to attend financial counseling. The loan–the credit union calls them short-term advances–can be for up to $500, or 80% of their net pay until their next paycheck. The innovative part of the loan is that the losses are not reserved for by the credit union, but in an account with the credit union’s non-profit Pentagon FCU Foundation. That’s because the loan would have a difficulty being approved by NCUA. Already, Pentagon FCU has shared the program with Fort Bragg FCU, Fort Stewart Georgia FCU and Fort Gordon FCU. The new funding will be used to expand to other defense credit unions and build loan loss reserves. About 1,000 military personnel have taken out ARK loans for more than $400,000 so far.

IOWA CITY – Members of University of Iowa Community CU turned out in droves last night and voted to recall the credit union’s new name, Optiva CU, just hours before it was scheduled to go up on signs at the credit union. The members voted 806-to-631 to retain the credit union’s name, reversing an October vote in favor of the new name that passed narrowly 198-to-192. “It was a huge amount of people. They were in lines of cars going all the way back to town,” said Carolyn Dieterle, one of the members who fought the name change, of last night’s special meeting held on the outskirts of town. Opponents of the name change, who petitioned for last night’s rare re-vote, easily outvoted the advocates, who were boosted by large numbers of credit union employees and their families and friends, who heavily favored the new name. Credit union officials explained they wanted to change names to de-emphasize the original field of membership as they sought to serve new markets in 14 surrounding counties, and as far as into neighboring Illinois. Credit union directors backed off their earlier position that the University of Iowa had urged them to shed the name. The $525 million credit union spent almost $500,000 on the ill-fated name change, including $250,000 to have Weber Marketing Group develop the new name and brand, and costs for new signs stationary, cards and checks that were supposed to go into effect on March 1.

SACRAMENTO, Calif. – The man suspected of robbing Placer Community CU in Grass Valley last month, and as many as four other credit unions and banks, was arrested after another bank robbery in Roseville. Jim Brian Smith, 26, was arrested Monday by the Roseville Police Department on suspicion of robbing of the US Bank branch on Fairway Drive in Roseville. Smith is also believed to be responsible for robberies at the Golden 1 CU in Lincoln, and robberies at the Bank of Lodi and Washington Mutual.

PANAMA CITY, Fla. – Tyndall FCU is offering a helping hand to low- and moderate income members wanting to buy a home. The $800 million credit union is offering 30-year, fixed-rate home loans for as little as 3.99% for members who earn less than $51,600. The so-called Helping Hands Mortgage requires no down payment for young families, first time homebuyers or low- to moderate-income members. To qualify members the home must be the members primary residence and the members must also meet the credit union’s credit criteria.

UNIVERSAL CITY, Texas – Randolph-Brooks FCU said yesterday it has installed Dicom Group’s Kofax Document Scan Server in its branches. The Document Scan Server can scan-enable any existing business application, like content management enterprise resource planning, and customer relationship management. The $2.5 billion credit union installed the server to facilitate the capture of loan documents remotely from its branches.

BURLINGTON, Vt. – Residents around the state are being taken in by a lottery scam, which uses phony checks from Alaska USA FCU to lure unsuspecting victims. The letters tell the recipients they have won the European lottery and come with a check for $4,600 purporting to come from the credit union. The letter asks the recipient to send along a check for $4,300 to cover the taxes on their $200,000 lottery prize. State Police say at least two people have been swindled out of more than $9,000.

McLEAN, Va. – Secondary mortgage giant Freddie Mac, under pressure from Congress and regulators, announced it is pulling out of the subprime mortgage market, adding new pressure on the sector. Freddie does not buy subprime mortgages but is one of the major players in the subprime mortgage bond market, holding about $200 billion in paper backed by the subprime mortgages. The move, which will reduce liquidity in the market, comes as subprime lenders are reporting mounting foreclosure rates leading to major losses. Several subprime lenders have filed for bankruptcy in recent weeks and Tuesday Fremont General Corp., the largest subprime lender, delayed its fourth quarter and annual financial reports. While credit unions make few subprime loans, observers are worried the troubles may spread throughout the whole mortgage market.

WASHINGTON – In an idea modeled after the Peace Corps, the volunteer youth brigade helping develop third world countries, the National Federation of CDCUs said yesterday it has created a CU Development Corps to assist community development credit unions. Initially the Development Corps will be made up of CU development Educators and the Federation’s network of 220 CDCUs. Des will visit CDCUs for up to two weeks and will have the opportunity to learn and to offer their expertise to help serve low-income members at CDCUs. Support for the program was provided by the Ford Foundation, a major benefactor of the Federation, and CUNA Mutual Group.

WASHINGTON – The issue of credit union service to the underserved has spread to a third congressional committee, the House Appropriations Committee, where NCUA Chairman JoAnn Johnson is expected to testify this morning of the many initiatives offered by NCUA credit unions around the country aid low-income communities. Today’s hearing, where representatives from well-known CDCU Bethex FCU and the CDFI fund will also appear, is the first on the subject at the Appropriations Committee’s newly formed subcommittee on Financial Services, which must approve annual appropriations for NCUA’s Community Development Revolving Loan Fund and the CDFI program. Congress has put more than $20 million into the NCUA community development fund over the years. Johnson is expected to discuss some of the initiatives undertaken by NCUA through its development fund, and by credit unions in the areas of payday lending and homeownership, and to tell lawmakers credit unions could do more if certain field of membership restraints are lifted. Specifically she will cite the new bar on community charters adding underserved communities to their FOMs. Over the last few years the issue of credit union service to the underserved as has been reviewed by the House Ways and Means Committee, which authorized the federal tax exemption, and the House Financial Services Committee, which debates all other issues concerning credit unions and banks.

KENSINGTON, Md. – Directors at Lafayette FCU, facing a recall petition by members, have changed the credit union’s bylaws to require voting be done in person. The bylaw change will make it easier for directors to retain their seats by mobilizing the credit unions paid employees on their behalf, just as threatened directors at DFCU Financial and Columbia CU did after failed attempts to convert to savings banks angered members. In the credit union’s most recent voting, a 90-day ballot on the conversion, the vast majority of the 5,100 votes were cast by mail, with fewer than 75 members attending the special meeting where the vote was culminated. The proposal to switch to a bank passed by just 18 votes but was later rescinded when the credit union’s outside auditing firm found potential irregularities in the vote. The board of the $330 million credit union, which barred the head of the petition drive from access to his accounts after the failed vote, also passed a new bylaw that allows it to limit services and access to credit union facilities for “a member who is disruptive to credit union operations.”

COVENTRY, R.I. – As many as 1,100 cardholders at local credit unions and banks are reporting incidents of fraud on their accounts due to the recently announced data breach at supermarket chain Stop & Shop. Police reported at least two credit unions were affected, with members at Coventry CU hit for around $10,000, so far. Citizens Bank appears to be the hardest hit, with more than $100,000 in fraudulent transactions on its cards, so far. Four California men were arrested Monday and charged with the a scam removing keypads from point-of-sale machines at Stop & Shop check-out lines and replacing them temporarily with skimmers that record card numbers and PINs. The information was used to make duplicate cards and withdrew $400 at a time from accounts. The four suspects were arrested while they were apparently trying to replace the POS keypad and in the Coventry Stop & Shop. Stop & Shop, which operates 385 supermarkets throughout the east coast, said the crooks succeeded in skimming POS machines in at least six of its stores in Rhode Island and Massachusetts. The supermarket chain has since bolted down POS machine keypads in all of its stores to prevent similar schemes. There have been reports of similar crimes in Philadelphia, Richmond, Los Angeles and Miami, by suspects with similar descriptions as the ones arrested here, police said.

JACKSONVILLE, Fla. – Frank Sanchez, the former CEO of Sanchez Computer Associates, which was acquired three years ago by Fidelity National Information Services, earned a one-day windfall of $3.1 million Feb. 21. Securities and Exchange Commission files show Sanchez, now head of FIS’s enterprise banking and retail operations, exercised 100,000 FIS options for $15.63 each, then sold the shares for $47, as FIS shares reached a new high. Sanchez’s father, Michael Sanchez, who founded Sanchez Computer, had a one-day windfall of $10 million on Jan. 7, when he exercised 287,000 FIS options, then sold the shares. The elder Sanchez is now the chairman of the international division of FIS. Sanchez Computer is one of eight back-office service providers acquired by Fidelity National to form Fidelity National Information Services.

JACKSONVILLE, Fla. – Fidelity National Information Services said yesterday it has expanded its outsourcing operations in India, with the acquisition of Second Foundation, Inc., a leading provider of offshore global information technology services. As a result of the deal, Fidelity Nationl’s India-based outsourcing operation now operates in Bangalore and Chandigarh. Fidelity National also provides outsourcing services in the Philippines. Fidelity National is one of the largest providers of back office services to credit unions with the recent takeovers of Open Solutions, Digital Insight, John H. Harland Co., and Corillian.

WALL STREET – The biggest credit union service providers, who had all rallied to new highs in recent days, were pulled down with the rest of the stock market yesterday after the Dow Jones average plunged 415 points, it’s steepest fall since the days after Sept. 11, 2001. Shares in First Data Corp. declined 4.5% for the day; Jack Henry & Associates fell 3.4%; Fidelity National Information Services fell 3.2%; CheckFree by 3.3%; Fiserv by 2.5%; and Online Resources by 2%, all on heavy trading, as the markets were in a huge sell-off. A statement by former Fed Chairman Alan Greenspan suggesting a recession was on it way, coupled with a big sell-off in overheated Chinese markets the night before, caused panic selling as the markets opened on Wall Street yesterday. By late afternoon the Dow was down 546 points–after plummeting 178 points in just one minute when New York-based Dow Jones switched to another data server that quickly calculated trades made earlier in the day.

ALEXANDRIA, Va. – NCUA announced yesterday it assessed more than $150,000 in fines to 22 credit unions for filing late reports required under the Home Mortgage Disclosure Act. NCUA only began assessing fines for late HMDA filing in 2005, fining 18 credit unions a total of $200,000 for the regulatory violation. The largest fine in the latest round, of $12,250, was assessed Rockland Employees FCU, in Spring Valley, N.Y. The smallest fine of $5,500 was assessed Golden Key FCU, in El Paso, Texas. The average fine was $7,000.

PITTSBURGH – The Federal Home Loan Bank of Pittsburgh said yesterday it is making $24.2 million available for affordable housing grants this year for it 335 bank and credit union members. That includes $7.64 million for its First Front Door lower-income homeownership grants. Only one credit union, Members 1st FCU, in Mechanicsburg, Pa., has qualified for the program, out of 60 banks.

TALLAHASSEE, Fla. – CU Performance Group a CUSO of Florida State University CU, said yesterday it signed with NetEconomy to market the company’s anti-money laundering system to credit unions. FSU CU, a $75 million credit union with 10,000 members, has implemented the system, known as ERASE Compliance Manager. The low-cost system is being geared towards smaller credit unions.

PHILADELPHIA – Borinquen FCU, a credit union in Hispanic north Philly, said yesterday it has agreed to acquire a new branch from Wachovia Bank for $1. The banking giant, which closed two neighborhood branches two months ago, said it has agreed to virtually give the CDCU one of the branches in exchange for the token payment. The purchase will double the branches for Borinquen, a 32-year-old founded to serve members of a Puerto Rican social services group. The $7 million credit union has partnered in the past with Wachovia, which also has a non-member deposit in the credit union. Wachovia plans to maintain its ATM at the new credit union branch.

WASHINGTON – Now it can be told. Senator Joe Lieberman said CUNA’s behind the scenes roll in his Senate campaign may have been responsible for his come-from-behind win. Lieberman, the first candidate ever elected to the Senate after losing his party’s primary, said it was a broad mailing campaign on his behalf secretly conducted by CUNA that may have pushed him over the top. The four-term Democrat was referring to almost $250,000 independent expenditures by CUNA in the final days of the Democratic primary, then again in the general election, when Lieberman ran as an independent, to blanket the state with pro-Lieberman mailings. As Lieberman noted during a speech at CUNA’s Governmental Affairs Conference, neither he or his staff knew of the CUNA mailing campaign and were barred from knowing under federal elections laws. “I will say I owe you for your support,” said Lieberman, who only learned CUNA’s roll after the elections. “Without that support I wouldn’t be here.”