Tuesday, January 31, 2017

New Consumer Due-diligence Requirements Mean Credit Unions Have to Change Bank Secrecy Act (BSA) Procedures

Starting May 11, 2018, credit unions and other financial institutions are required to have new procedures in place when it comes to customer/member due-diligence, primarily involving “beneficial owners” and “legal entity” members, reminded CUNA.
But the trade association reported that the new requirements do not mean credit unions have to update member information on a continuous or periodic basis.
“The rule does not require credit unions to update member information on a continuous or periodic basis. The updating requirement is event-driven and only occurs as a result of detecting unusual activity through normal monitoring,” CUNA stated.
The new procedures required by May 11, 2018, are:
  • Procedures to identify and verify beneficial owners of legal entity members. 
  • Procedures for making and maintaining a record of all the identification and verification information collected for beneficial owners of legal entity members. 
  • Appropriate risk-based procedures for conducting ongoing member due diligence. 
  • Updated recordkeeping procedures to record, any identification information obtained, a description of any document relied upon, any non-documentary methods used; and any measures taken in response to any substantive discrepancies, as well as the results of those actions.
According to CUBA, the rule also provides two new definitions:
  • “Beneficial owner:” Ownership criteria (25% or more equity interest) and/or control criteria (has significant responsibility to control the legal entity). 
  • “Legal entity:” Accounts owned by legal entities, rather than natural-person accounts.

Monday, January 30, 2017

Mortgage rates have risen for the first time in 2017

WASHINGTON–Mortgage rates have risen for the first time in 2017.
According to Freddie Mac:
  • The 30-year fixed-rate mortgage (FRM) averaged 4.19% with an average 0.4 point for the week ending Jan. 26, 2017, up from one week earlier when it averaged 4.09%. A year ago at the same time, the 30-year FRM averaged 3.79%.
  • The 15-year FRM averaged 3.40% with an average 0.4 point, up from one week earlier when it averaged 3.34%. A year ago at the same time, the 15-year FRM averaged 3.07%.
  • The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.20% with an average 0.4 point, which was down from one week earlier when it averaged 3.21%. A year ago, the five-year ARM averaged 2.90%
"The 10-year Treasury yield increased more than 10 basis points this week,” said Sean Becketti, chief economist, Freddie Mac, in a released statement. “The 30-year mortgage rate moved up as well to 4.19%, a 10-basis-point jump. This week marks the first increase in the mortgage rate since December 29. The 2.8% decline in existing home sales in December is a reminder of the lack of homes for sale. According to the National Association of Realtors, supply is at its lowest level since 1999, a factor that should support higher house prices regardless of the oscillations of the mortgage rate."

Thursday, January 26, 2017

President Donald Trump has appointed J. Mark McWatters as acting chairman of the NCUA

President Donald Trump has appointed J. Mark McWatters as acting chairman of the NCUA, industry sources said Thursday.

NCUA had not confirmed the selection by the time this story was posted.
McWatters, a Republican, replaces Rick Metsger, a Democrat who remains on the board. The president has the power to select a chairman and it had been widely speculated that Trump would select McWatters, since currently there are only two members on the three-member NCUA board.
The chairman designation does not require Senate confirmation

Trump will be able to nominate another Republican for the vacancy on the board. However, the president’s party may only have two seats on the board.

McWatters became a member of the board in August 2014, when he was confirmed by the Senate. At the time, he was new to the credit union industry.

Last year, President Obama nominated McWatters for a vacancy on the Export-Import Bank, but the nomination died when the-Senate Banking Chairman Richard Shelby (R-Ala.), an opponent of the bank, refused to consider the choice.

In the December issue of the NCUA Report, McWatters outlined several priorities he would like to see the board tackle this year, including areas in which the agency could be more helpful to small credit unions and the establishment of a Credit Union Advisory Council

Prior to joining the board, he was a member of the Troubled Asset Relief Program Congressional Oversight Panel and served as counsel to House Financial Services Chairman Jeb Hensarling (R-Texas).

Before that, he served as the Assistant Dean for Graduate Programs and a Professor of Practice at the Southern Methodist University Dedman School of Law, as well as an Adjunct Professor at the SMU Cox School of Business.

Monday, January 23, 2017

Fire Family Foundation Provides Over $350,000 in Aid in 2016


CONTACT: Robin McCarthy

Fire Family Foundation Provides Over $350,000 in Aid in 2016
Assisting Firefighters, Fire Families
LOS ANGELES, CA -- As the charitable hand of the Los Angeles-based Firefighters First Credit Union, Fire Family Foundation dispersed more than $350,000 in assistance to firefighters and fire families in need in 2016.
That amount more than doubles the previous year.  
Serving firefighters, their families and fire victims, the Foundation ensures donations directly support those in need, covering medical expenses, mortgage payments and daily living costs; assistance was distributed to numerous individuals, families and communities impacted by fire. 
“Be it fire, devastation, illness or death, the support provided by the Foundation helps families, fire victims, and fire families begin the long process of recovery.  We continue to be humbled by the support we received in 2016 from the firefighting community and the general public,” commented Mike Mastro, Foundation Board Chair, who serves as President/CEO of Firefighters First.  “The Foundation continues to respond to those in need from injured firefighter to a family member with a medical emergency to a fire victim with a housing crisis.  The Fire Family is a close-knit community and we truly try to take care of one another.”
The Foundation helped many this year, including:
·        Young Annie who has been battling cancer most of her 5-year life
·        The family of a young firefighter who passed away unexpectedly while on vacation
·        Rialto Fire Department as they aided victims of the 2015 San Bernardino shooting
·        The family of an inmate crewmember killed as she helped battle a wildfire
·        Supporting a vigil for all first responders – including Oakland firefighters – in the aftermath of the devastating Ghost Ship Warehouse fire that claimed 36 lives.
·        Educational needs for the son of a firefighter who passed away
·        A fire captain struggling with PTSD
·        A veteran firefighter mom battling cancer who also has twin daughters
·        Victims of the devastating Erskine and Sand Fires, especially housing needs to firefighters who lost their own homes.
The assistance was broad.  Support went to Baton Rouge, Louisiana to help the flood victims, firefighters in Indianapolis who have struggled with cancer, and funeral assistance for a Charlotte, North Carolina firefighter as a few examples, plus dozens of fire victims within California.
Foundation Executive Director Robin McCarthy explained the Foundation’s focus and mission: “In 2016 Fire Family Foundation offered a hand to hundreds.  Some of our biggest assistance items were $123,000 in mortgages/housing costs; $75,000 for hospital/medical expenses; and $59,000 for education and tuition, to name a few.  This year we are helping more, providing support when victims feel alone and not certain where to turn, especially our firefighting community. Once again, we stand behind our dedicated firefighters.”
Learn more at Fire Family Foundation and individuals/organizations that it’s currently helping at www.firefamilyfoundation.org.  Follow Fire Family Foundation on Facebook at www.facebook.com/firefamilyfoundation and/or on Twitter at @FireFamilyFound. 


Fire Family Foundation responds when tragedy affects firefighters and fire victims.  A nonprofit founded by Firefighters First Credit Union, Fire Family Foundation offers immediate assistance to firefighters and their families, fire victims, fire departments, and charities.  The Foundation believes that by coming together as a “Fire Family,” assistance can be provided to those impacted by fire.

Friday, January 6, 2017

Mike Mastro CEO of Firefighters First Credit Union is preparing for retirement.

After a lengthy and successful career in credit unions, topped by being President and CEO of Firefighters First Credit Union for the last 24 years, Mike Mastro is preparing for retirement. In his 36-year tenure, the credit union has grown to over $1.1B in assets with over 37,000 members.  The credit union has launched many financial service innovations that compete head to head with larger banks – such as business lending, investment services, and insurance services.  As part of their growth strategy, the credit union executed on a successful field of membership expansion and in 2014 changed its name from Los Angeles Firemen’s Credit Union to Firefighters First.  Mike also had the vision to create the Fire Family Foundation after 9/11 to ensure that the firefighter community was not only supported through traditional financial service offerings, but also during tragedies and difficulties in life. 

“My first job at this credit union was as Financial Controller – a position that would be called the Chief Financial Officer today,” he recalled. “In those days the top job was General Manager. I became the equivalent of Executive Vice President in about 1988. In 1992, I became President and CEO.”

Mastro counts Doris Zuckerman, his predecessor as CEO, as the biggest influence on his career. “She is now deceased, unfortunately, but Doris really drove the concept of personal service and the special nature of our firefighters. From her, I learned how to treat firefighters well.”

Mastro says his time at Firefighters First has been made all the more special by the special membership the credit union serves. “Our Board of Directors is an inspiration to me because they are all firefighters,” he said recently. “I respect the danger they face in their jobs. Working with them has been an amazing lesson to me and it has been an honor to serve them.”

“No single person in our history has had a greater impact on this organization than Mike Mastro,” noted Board Chair, Scott Gribbons, a 29-year veteran of the LA City Fire Department.   “Mike’s leadership has had a significant and positive impact on our organization, our employees, our members, the Board, and me personally. Congratulations Mike on a remarkable career!”

Mastro shared his intention to retire with the Board in 2015 and formally announced his retirement plans in August 2016. Working with Mitchell, Stankovic and Associates, the Board developed a selection process designed to recruit and evaluate CEO candidates based upon an established CEO profile.  To this end, Board Chair Gribbons emphasized, “The selection of our next CEO was one of the most important decisions the Board of Directors will make as a governing body. We have been working very thoughtfully over the past year to develop a CEO succession plan that ensures due diligence is given to this vital leadership transition.”  The Board announced in December that the credit union’s current Executive Vice President, Dixie Abramian, will succeed Mastro and the next few months will involve a steady transfer of leadership responsibilities.

The Board worked with Mitchell and team to conduct a rigorous search resulting in internal and external candidates.  The Board sees tremendous value in continuing to proceed with the strategies identified and saw Abramian as the best person to successfully lead the credit union into the future.  Abramian earned the position.

Abramian has helped launch and envisioned many of the credit union’s services and strategies during her 24+ years with Firefighters First.  She began her career as a teller, working her way up in the organization through collections, training, marketing, business development and prior to her promotion to EVP, as the Chief Strategy and Operations Officer. Her experience, education, and dedication make her a natural fit for this position.  Dixie holds an Executive MBA from Pepperdine and a Bachelor’s degree in Finance from California State University, Northridge.

Her passion for learning and development, the firefighter membership the credit union serves, and the mission of credit unions drives her decision making.  Her strategies have included the deployment of regional offices, the development of cross-trained Financial Service Consultants, and the credit union’s strong member focus.  She enjoys wide support across the credit union. Abramian’s commitment is best articulated by her, “I am very proud of our deep commitment to providing legendary service. We measure ourselves to ensure we are the best of the best, because that is what our members deserve.  Our mission remains steadfast – to improve the financial lives of our fire family.”

Mastro said he is giving simple advice to his successor: “Be courageous in how you think and how you execute.  You will be working with a membership that displays that every day. Keep an open mind, be innovative in your thinking, drive personal relationships and connections with members and employees, and, above all, ensure integrity.”

The first stage of the transition period occurs on January 1, 2017 when Abramian will officially become President, followed by being named President and CEO on April 15, upon Mastro’s retirement. Firefighters First has been committed to developing executive talent, which has paid off in terms of steady growth and successful execution of strategic initiatives.

About Firefighters First Credit Union
Firefighters First Credit Union was formed in 1935 as Los Angeles Firemen’s Credit Union and serves full-time, paid professional firefighters and their families throughout the state of California.   Firefighters First currently has assets of over $1.1 Billion and serves over 37,000 members in over 330 fire departments statewide. Specific details on eligibility, and more information about the credit union, are available at firefightersfirstcu.org or by calling 800.231.1626.

About Mitchell, Stankovic & Associates
Mitchell Stankovic & Associates is a global strategic consulting organization that has over 25 years working with credit union clients as partners to get results.  MSA provides proven consultation based upon years of experience in the financial services industry, delivered with innovative methods harvested from the most up-to-date business practices available today.  Engaged with executives and boards, MSA facilitates leadership transitions, strategic planning sessions, CEO compensation analysis, executive coaching, board governance, and educational development.  Contact us at www.mitchellstankovic.com or by calling 855-362-2002.