WASHINGTON – Democratic Presidential hopeful Christopher Dodd gathered credit union executives in key primary states in a backroom at the Washington Hilton yesterday after remarks at CUNA’s Governmental Affairs Conference in order to gauge support in those critical states. During his remarks to 3,000 credit union executives and volunteers Dodd hit on populist themes he has been trying out in his new role as chairman of the Senate Banking Committee, like the need to reign in predatory lending and extend credit to the underserved. Afterwards, the Connecticut Senator gathered a handful of representatives to the earliest Democratic primary states, Iowa, New Hampshire, Nevada, as well as his home state of Connecticut, and California, to try and gauge the support of those issues in their states, according to individuals who were present at the closed-door meeting. But Dodd never asked for their support, financial or otherwise, the attendees said. Dodd is one of a half-dozen Democrats already running for the 2008 nomination.

WASHINGTON – Lawmakers are still dickering over new limits on member business lending, as they try to wrap up work on CURIA and introduce it in the House. Pennsylvania’s Paul Kanjorski, the hero of HR 1151 a decade ago, told attendees to CUNA’s Governmental Affairs Conference he is considering new ways to make it tougher to convert to mutual savings banks as he completes drafting the bill, the CU Regulatory Improvements Act. An ardent critic of the credit union conversions, Kanjorski said he may require a special meeting of members before they vote on the charter switch, and also require at least 30% of all members vote. This would make it very difficult to convert because few of the 40 credit unions converting to savings bank so far have obtained a 30% vote. “We’re just not going to allow smart aleck Washington lawyers and (credit union insiders) to go out and rape credit unions,” the Democratic lawmaker said. Kanjorski also said he has not settled on a number for increasing the current 12.25% (of assets) cap on member business loans, and may go to 20%, as in last year’s bill, or “nudge it a little above that.” The bill will also include provisions enacting a risk-based capital system for credit unions; allowing credit unions to retain their select groups after converting to community charters; and allowing all credit unions to add underserved communities to their fields of membership.

COVENTRY, R.I. – Four California men were arrested at a Stop & Shop supermarket Monday night in connection with a broadening scheme to tamper with point-of-sale machines at check-out lines and inserting them with skimmers to steal critical credit data. The four were arrested after they attempted to replace check-out lane keypads in order to steal credit and debit card numbers and passwords, police said. The suspects were identified as Arutyun Shatarevyan, 20, Mikael Stepanian, 28, Grevork Baltadjian, 20, who were arrested inside the store, and Arman Ter-Esayan, 22, arrested in the parking lot. New England’s largest supermarket chain said credit card information was stolen in a similar manner from as many as six of its supermarkets in Rhode Island and Massachusetts. In those incidents the thieves apparently switched the original keypad with an alternate keypad used to record card information. Then they switched the keypads back a few days later. Stop & Shop has responded by bolting down the keypads on their POS machines in all of its 385 stores.

WASHINGTON – Legislation to reign in data security breaches and identity theft will starting to take shape in Congress will have key provisions shaped by credit unions requiring the source of a data breach to pay all costs to customers related to the breach, key lawmakers said yesterday. Congressman Barney Frank, chairman of the House Financial Services Committee, said he was influenced by the rising costs of the growing number of data breaches for HarborOne CU, a Brockton, Mass., credit union in Frank’s congressional district. The $1.4 billion credit union has paid hundreds of thousands of dollars in uninsured costs to reissue cards 12 times in 2004, 35 times in 2005, and 44 times again in 2006, and has already reissued more than 100,000 cards to protect against the latest data breach at TJ Maxx. Frank told some 3,000 attendees to CUNA’s Governmental Affairs Conference any bill passed by the Financial Services Committee will have a provision requiring the party responsible for the breach to pay costs, such as cards reissuing, for the affected parties. Frank’s bill will be one of as many has half a dozen bills that would address data security, which will make it hard to reconcile all the different bills and congressional committees.

SAN DIEGO – San Diego Metropolitan CU announced yesterday it has signed to become an official marketing partner with the city of San Diego. Under the five-year deal, the $325 million credit union will pay the city $100,000 a year to call itself the ‘official credit union partner’ of the city and to market its services to city employees and retirees. The credit union will also conduct seminars for city employees on a variety of personal finance topics, as well as identity theft. Other marketing partners with the city include: Vreizon Wireless, the Pepsi Bottling Group, McCune Chrysler-Jeep, Cardiac Science and the Sunroad Community Foundation.

MADISON, Wis.– Peggy Post, the wife of CUNA Mutual President Jeff Post, has died after a long illness. Jeff Post did not attend CUNA's GAC in order to be with his wife, and issued a statement saying his wife wanted a quiet, private remembrance. Jeff Post noted that his wife had in recent years become a big supporter of Gilda's Club of Madison, Wis., the local office of the national group organized to support cancer patients by actress Gilda Radner. Jeff Post asked that in lieu of flowers donations be made in Peggy's name to Gilda's Club Madison Wisconsin, 3000 Cahill Main Suite 201, Madison WI 5371.

RICHMOND, Va. – Brink’s Co. reported yesterday that it officially appointed hedge fund manager Thomas Hudson to its board, settling a brief campaign by the self-proclaimed pirate to force the sale of the venerable cash carrier and security company. Hudson’s company, Pirate Capital and its Jolly Roger Fund accumulated a 9% stake in Brink’s and waged a proxy battle for two seats on the board, where the pirates plans to agitate for the sale of the company. But after Brink’s fourth quarter report showed a tripling in earnings for both the fourth quarter and fiscal 2006, Hudson, Brink’s largest shareholder, lost the upper hand and settled for a single seat. Separately, Brink’s announced it awarded $5 million in bonuses as rewards for the financial performance, with Chairman and CEO Micheal Dan receiving $2.7 million; and CFO Robert Ritter $670,000.

KINGSPORT, Tenn. – Eastman CU said yesterday it signed with Integrated Media Management to implement the company’s TotaleAtlas, TotaleReceipts and TotaleChecks document management and electronic signature capture systems when they convert to a new core processor later this year. The TotaleWorks suite improves the transaction process by converting it from paper. MMI is based in Linden, N.J.

ST. PAUL, Minn. – Affinity Plus FCU said yesterday it has signed with Dynamic Card Solutions to implement the company’s CardWizard instant card issue and PIN selection software. The $1 billion credit union plans to install CardWizard in 14 branches of its 22 branches by the end of February. The credit union is the 300th CardWizard customer.

COLUMBUS, Ohio – TNB Card Services said yesterday it bought another large credit union cards portfolio, it’s second large purchase in a week. The deal for Columbus, Ohio-based CME FCU’s $15 million portfolio, with 5,500 accounts, comes a few days after the credit union-owned bank announced the acquisition of a $16 million portfolio from A+ FCU, in Austin, Texas. The two deals, larger the typical TNB acquisitions, come a few weeks after the company raised $60 million in a stock offering in order to pursue larger deals. TNB is owned by Dallas-based Town North Bank, the only credit union-owned bank.

MIRAMAR, Fla. – Eastern Financial Florida CU announced yesterday it has selected Sun Life’s Independent Financial Marketing Group as an in-house securities and insurance broker. The deal will give Eastern Financial’s 215,000 members and 950 member companies access to wealth management and retirement products, including annuities, mutual funds and 401K plans. Eastern Financial is one of the nation’s largest credit unions, with $2.4 billion in assets.

WASHINGTON – CUNA Mutual Group yesterday introduced what it calls a 401K annuity for credit union employees that guarantees the principal. The Guaranteed principal rider requires the money be allocated in one of CUNA Mutual’s Lifestyle Funds for a minimum of 10 years. The fee is a single basis point. CUNA Mutual claims a 50% share of credit union pension funds, with more than $5 billion under management for employees at more than 4,500 credit unions.

JACKSONVILLE, Fla. – Community First CU of Florida, one of the state’s largest credit unions, said it has discontinued its indirect auto lending program. The program is one of Florida’s largest at about $100 million a year through 12 dealerships. Officials with the $1 billion credit union said they indirect auto loans amounted mostly to short-term relationships that were hard to expand on.

WASHINGTON – Allan Kemp McMorris, a self-proclaimed ‘hog-riding’ CEO of a mid-sized mid-western credit union, was elected chairman of the CUNA Board of directors for the next two years. McMorris, who told attendees to CUNA’s Governmental Affairs Conference of his love for road riding on his Harley Davidson motorcycle, is president of Oakland County CU, a $150 million credit union in Waterford, Mich. He succeeds Juri Valdov, president of Northwest FCU, in Henrdon, Va., as CUNA chairman. Also elected by the CUNA Board were: Tom Dorety, president of Suncoast Schools FCU, in Tampa, Fla., as vice chairman; Kris Mecham, president of Deseret First CU, Salt Lake City, as secretary; Harriet May, president of GECU, in El Paso, Texas, as treasurer; and Mike Mercer, president of Georgia CU Affiliates, at-large.

WASHINGTON – Allan Kemp McMorris, a self-proclaimed ‘hog-riding’ CEO of a mid-sized Michigan credit union, was elected chairman of the CUNA Board of directors for the next two years. McMorris, who told attendees to CUNA’s Governmental Affairs Conference of his love for road riding on his Harley Davidson motorcycle, is president of Oakland County CU, a $150 million credit union in Waterford, Mich. He succeeds Juri Valdov, president of Northwest FCU, in Henrdon, Va., as CUNA chairman. Also elected by the CUNA Board were: Tom Dorety, president of Suncoast Schools FCU, in Tampa, Fla., as vice chairman; Kris Mecham, president of Deseret First CU, Salt Lake City, as secretary; Harriet May, president of GECU, in El Paso, Texas, as treasurer; and Mike Mercer, president of Georgia CU Affiliates, at-large.

WASHINGTON – NCUA plans to reestablish itself as arbiter in bylaw disputes at credit unions, after two decades of sitting on the sideline, according to NCUA Chairman JoAnn Johnson. Johnson told some 4,000 attendees to CUNA’s Governmental Affairs Conference yesterday that a number of recent bylaw disputes as prompted the federal regulator get back into the business of enforcing bylaw, something that it largely abandoned in the 1980's, except in case of regulatory or legal violations or financial instability. “We have never said NCUA lacks authority to enforce bylaws based on the FCU ACT, but rather opted to leave much bylaw enforcement to members and federal credit unions,” said Johnson. But the past year has seen several instances where credit union boards have refused to enforce bylaws and state courts have been reluctant to step in, she said, referring to recent member initiatives to recall directors after they attempted to convert the credit unions to mutual savings banks. NCUA staff, she said, is drawing up a rule that will once again incorporate a credit union’s bylaws into NCUA rules and regulations, as it was prior to 1982, making a violation of the bylaws akin to a violation of NCUA rules. That means NCUA could enforce bylaws through a variety of means, including cease and desist orders, prohibitions or civil money penalties.

WASHINGTON – Credit unions are plotting a nationwide lending brokerage service modeled after the successful Zopa. Several credit unions are planning a CUSO that will act as an online referral service for credit unions and potential members, according to Guy Messick, general counsel for the National Association of CUSOs, who is involved in the project. Much like the British model, the service would match individuals seeking loans with a credit union they are eligible to join. But unlike the original Zopa, which matches individual lenders with individual borrowers, this model would match lenders with credit unions. The service would be limited to unsecured loans, in the beginning, said Messick, who was attending CUNA’s Governmental Affairs Conference. Several credit unions are currently working with representatives of Zopa and with Members Gateways, a CUSO that serves as an incubator for credit union innovations.

WASHINGTON – Credit union executives and directors, frustrated over their liability for cards breaches for their bank-owned Visa and MasterCard systems, floated the idea yesterday of a credit union-owned credit card brand. “Eighty-nine million members. Is it time to put our own card out there? Discover did it a number of years ago,” said an agitated Jim Blake, CEO of HarborOne CU, whose Brockton, Mass., credit union had to reissue cards 12 times in 2004, 35 times in 2005 and 44 different times in 2006. He expects to reissue more than 100,000 cards because of the latest breach at TJ Maxx. Blake, during a session at CUNA Governmental Affairs Committee, said he believes the ongoing crisis in data security could be largely solved if the two cards companies enforced their own security standards, particularly the ban on the retention of customer data. “There’s got to be a break in there for us if we can compete on our own, with our own card,” said the head of the $1.4 billion credit union. A credit union card brand, like the credit union ATM brand, would be managed by credit unions, with transaction and interchange fees circulated back within the credit union movement, not taken out of the system by the big banks. Jim Fossos, secretary of the board at Seattle Metropolitan CU, liked the idea and suggested credit unions could benefit by providing a credit union owned alternative to the Visa and MasterCard, both controlled by large banks. “We ought to start looking at our own credit card,” said Fossos.

WEST PALM BEACH, Fla. - Credit Union Journal asked state leagues: tell us about the perceptions of whom credit unions are supposed to serve that you encounter in the media, the public and in politics, and how you address those perceptions.

Throughout 2007, the Credit Union Journal, in conjunction with ENCORE Card Services, are profiling the credit unions of each U.S. state and D.C. Rather than appear in alphabetical order, the states are being featured in the order they became states. For info: visit www.encore-ecs.coop.