To Email or Not to Email Credit Union Members

Important Tips on Credit Union Email Marketing

To Email or Not to Email

We already went into some important rules on email marketing in our Email Dos and Don’ts article, but there is always more that can be discussed about this powerful and cost-effective tool for reaching your members with your services and promotions. Email brings up many compliance risks, and so it is something that should be reviewed. So let us help you with knowing when to email or not to email credit union members.

Why should you continue or create an email marketing strategy?

Most consumers prefer email, and so marketing through their preferred media makes sense. Email is also one of the most cost-effective methods to get your message out to the masses. There is also the fact that email is permission-based. This means someone has to approve the emails, or at the very least, they have the ability to stop the emails. Email is also convenient for the consumer as well as the credit union since they can engage with the brand anywhere they go, and very easily.

What should I use email for?

Consumers love promotions and coupons. Who wouldn’t want to save money on a product or service they need or want? This is the same for contests or rewards programs. You can notify your members of news and updates about the credit union, or your products and services. There are many purposes that you can use emails for.

How do I do it?

There are many providers to help in creating your email blasts, and they are very cost-effective. When you are running your email campaigns, it is important to be aware of the pitfalls that could end up costing you, though.

Let’s go over some important rules when emailing your members marketing materials and creative content. Official rules can be found on the FTC website, and are required for email communication from businesses to consumers. The rules are pretty simple, and it is important that you do not try and work around the basic boundaries, as they are there to protect your members – just like you!

Compliance and Permission

Get consent from your members to use their email addresses for e-communication, and let them know that you are using their info for that purpose. Give them the option to “opt-in,” and always offer email updates and newsletters to your members when interacting in-branch, and in your online communities. Don’t miss opportunities to have members go paperless with the latest news your credit union has to offer.

No misleading information

Avoid misleading information, especially in your subject line! You need to be clear about the content of your email. Your members should not think they are opening an email from a known close friend, but a friendly neighborhood credit union with beneficial rates and services! With so many phishing scams and email hacking going on in the digital age, a clear subject line actually increases your chances of getting your email opened and read, whereas misleading subject lines are becoming more of a red flag.

Based on the FTC guidelines the following tips are very important:

1. Don’t use false or misleading header information. Your “From,” “To,” “Reply-To,” and routing information – including the originating domain name and email address – must be accurate and identify the person or business who initiated the message.
2. Don’t use deceptive subject lines. The subject line must accurately reflect the content of the message.
3. Identify the message as an ad. The law gives you a lot of leeway in how to do this, but you must disclose clearly and conspicuously that your message is an advertisement.
4. Tell recipients where you’re located. Your message must include your valid physical postal address. This can be your current street address, a post office box you’ve registered with the U.S. Postal Service, or a private mailbox you’ve registered with a commercial mail receiving agency established under Postal Service regulations.
5. Tell recipients how to opt out of receiving future emails from you. Your message must include a clear and conspicuous explanation of how the recipient can opt out of getting an email from you in the future. Craft the notice in a way that’s easy for an ordinary person to recognize, read, and understand. Creative use of type size, color, and location can improve clarity. Give a return email address or another easy Internet-based way to allow people to communicate their choice to you. You may create a menu to allow a recipient to opt-out of certain types of messages, but you must include the option to stop all commercial messages from you. Make sure your spam filter doesn’t block these opt-out requests.
6. Honor opt-out requests promptly. Any opt-out mechanism you offer must be able to process opt-out requests for at least 30 days after you send your message. You must honor a recipient’s opt-out request within 10 business days. You can’t charge a fee, require the recipient to give you any personally identifying information beyond an email address, or make the recipient take any step other than sending a reply email or visiting a single page on an internet website as a condition for honoring an opt-out request. Once people have told you they don’t want to receive more messages from you, you can’t sell or transfer their email addresses, even in the form of a mailing list. The only exception is that you may transfer the addresses to a company you’ve hired to help you comply with the CAN-SPAM Act.
7. Monitor what others are doing on your behalf. The law makes it clear that even if you hire another company to handle your email marketing, you can’t contract away your legal responsibility to comply with the law. Both the company whose product is promoted in the message and the company that actually sends the message may be held legally responsible.

It can seem daunting to look at the many things involved in running a legitimate and compliant email marketing strategy. That is why Oak Tree Business Systems, Inc. is here for the credit union community. We are ready to help you strategize and create an awesome email blast campaign that drives your membership numbers and other lending growth numbers. If you have something to add about when and what to email or not to email credit union members, then please let us know on our social media or below.

Contact us today MarketingServices@Oaktreebiz.com or visit our website’s Marketing Services Page to get started.

Lending Checklist for Credit Unions

Lending Checklist for Credit Unions

Have you heard the good news? Credit union lending is on the rise. Starting in 2018, many credit unions outsold banks and it’s still going strong. That’s right. According to the latest Federal Reserve report, credit unions passed banks by securing more loans for credit cards and automobiles. That’s great news! In light of this, we thought it would be a good idea to walk through a lending checklist for credit unions with you. We know you’ll want to position yourself to take advantage of the momentum.

Lending Checklist for Credit Unions

🔲 Awareness.

Are your members aware of the different types of loans you offer? Each member has the potential to become a new loan customer. Make sure your staff is in tune with as many members as possible. Being aware of their financial situations will let you know which loan products to offer. Also, make sure you pitch mobile loan application processes, too. This may encourage shy members to initiate a loan, especially if they are unsure of their credit. They can always come in later to finish.

🔲 Forms.

Make sure you are using compliant forms. The National Credit Union Administration (NCUA) nor The Consumer Financial Protection Bureau (CFPB) take compliance lightly, and neither do we. We offer great consumer forms, as well as forms for home equity lending. We work hard to make sure our forms are compliant and accessible. Each package has several different delivery methods and will easily integrate with your data processor. The backbone of good lending is compliance. We have you covered there.

🔲 Marketing.

Do you have campaigns ready for each season? Do you know when to offer home equity products and when to pitch automobile loans? We have a fully-staffed marketing department that is ready to help you craft a targeted campaign that will deliver results. One phone call is all it takes to get started.

🔲 Member Checklist.

Leave it to us to have a checklist within an article about that very thing. Your staff also needs one for members, though. Nothing is more frustrating to a member than talking with a loan processor who is unprepared. Make sure your specialists have a reference list of specific items they will need from your member, according to which product they are applying for. Also, make sure to keep all necessary forms on hand in one easy-to-find place, so that starting the underwriting process is a breeze. 

Tick off the items on this checklist to prepare for the lending momentum heading your way. The ball is already in motion. To paraphrase a quote from one popular television show, “Spring is Coming.” Consumers will spend through spring and summer. There are several major holidays tucked in there, after all. Positioning yourself now will allow you to ride the wave later. Help your members’ accounts stay on a happy note. Do that, and their attitude towards your credit union will be the same!

5 Reasons Credit Union Lending Beats the Bank

5 Reasons Credit Union Lending Beats the Bank

The next time one of your members thinks about getting a loan to make home repairs, finance a new home, or purchase a vehicle, use the five tips below to help the member choose you as a lending option. People often operate under the assumption that a bank is the only place that can serve their lending needs. It might be time for you to shine a little light on the subject for the potential borrower. Listed below are our 5 reasons credit union lending beats the bank for lending.

5 Reasons Credit Union Lending Will Beat a Bank Every Time

1. Higher Approval Rates If your member’s credit is stained, dirty, or needs a bit of repair, your credit union is much more likely to be accommodating than a bank. Though the loan terms and processes are very similar, credit unions are known for listening to their members’ needs. Credit unions are most likely to understand that unique situations occur, and will work toward loan approvals. They will even adjust loan terms accordingly in some instances. Book any type of loan when you use Oak Tree forms.

2. Better Rates To explore this, let’s look at vehicle loans. Typically, most of us will secure a five-year loan for a vehicle. The rate at the credit union will be much lower than the interest rate at a traditional bank. It may only look like a 1% difference, but that 1% can add up to thousands of dollars put back into your member’s pocket during the life of the loan. Oak Tree forms stay on top of state and federal compliance laws and their ongoing changes, which supports low-interest rate loans.

3. Better Services Since credit unions are classified as nonprofit, they don’t answer to a shareholder board. Operation decisions are usually made by a volunteer board, rather than corporate office appointees. To that end, members feel much more comfortable talking to their credit union about payment options and services. It is much easier to talk to someone when you feel like they genuinely have your best interest at heart. In addition, Oak Tree seamlessly integrates your credit union forms into your data processing system with Data Linking, allowing for faster loan processing, and saving your members time.

4. Educational Resources Your credit union may have a resource center, which serves to educate your members on different finance options, financial products, and bank accounts they may have. Utilizing this resource can aid members in making a decision that best suits their needs when it comes time to secure a loan or otherwise. In addition, your credit union will probably go the extra mile, being a member-driven financial service institution. For instance, the credit union may determine the value of a vehicle so the member feels good about the loan before applying. Since the credit union is nonprofit, their answers are unbiased, so members know the credit union is not trying to inflate or deflate the value of the vehicle to stick them with a higher-rate loan. Oak Tree also offers training so your credit union staff is ready to use our forms and help members obtain the best loan.

5. No Selling Since they are nonprofit, credit unions essentially work for you. There is no incentive for them to sell you any new product or service. All profits generated by the credit unions go back to members, showing up in lower interest rates or new financial products, like different savings account loan options. This makes it easy to find a credit union that meets your needs. This, in addition to a faster loan processor, will lead to word of mouth from happy members.

Now you can put a bug in your member’s ear so to speak, the next time the subject of lending comes up. Use these 5 tips to promote yourself. Of course, Oak Tree will stand ready as your forms provider. The friendly, consistent, and trustworthy nature of your credit union, coupled with our compliant lending forms, will ensure that your members have a great borrowing experience. Members will be glad they made the switch!

Credit Union Compliance Keep Your Guard Up

Credit Union Compliance Keep Your Guard Up

As dry subjects go, there aren’t many topics arider than regulatory compliance. It’s virtually the Mojave Desert of subject matter. Just like a real desert, though, it isn’t wise to try to navigate the compliance landscape without knowing what you’re doing or where you’re going. When it comes to Credit Union Compliance Keep Your Guard Up!

The unprecedented volume of regulatory changes that were generated during the past decade has financial institutions of all types looking for a break in the action, for a chance to get their bearings. So, when serious talk of regulatory relief holds out hope that help may be forthcoming, it’s only natural for those shouldering the burden to breathe a sigh of relief, and to take time to attend to other matters. However, just because efforts are underway to ease the regulatory load, it’s not the time for credit unions to drop their guard.

Between the alphabet soup of federal regulations overseen by the CFPB and the regulations issued by the NCUA and other state and federal regulators, credit unions are subject to dozens of complex regulatory requirements that are designed to shape the way they conduct business. The federal Truth in Lending Act and Equal Credit Opportunity Act, together with the CFPB’s Regulations Z and B, are just a few of the regulations that dictate how credit unions meet their members’ credit needs. As for share accounts and other deposit products, the federal Expedited Funds Availability Act and the federal Truth in Savings Act have given us Regulation CC and the NCUA regulations in 12 C.F.R. Part 707, and the Electronic Fund Transfer Act has spawned Regulation E. Of course, there’s also the federal Bank Secrecy Act, the Flood Disaster Protection Act, and the SAFE Act, all of which have been implemented through NCUA regulations. Other NCUA regulations govern business operations and naturally, state laws and regulations are also in the mix. Together, these laws and regulations create a complex web of requirements that must be taken into account by credit unions to effectively manage both operational and reputation risk, and to safeguard against potentially costly civil liability.

Over time, each credit union has developed a variety of policies, procedures, systems, and tools that establish the framework for the way that credit union does its business. Whether developed in response to regulatory changes, business objectives, or as new products have been added to the mix, this “compliance management system” (CMS) is itself a system that needs monitoring. To better manage the compliance risks that every credit union faces, senior management and the credit union’s board of directors must periodically revisit each of the policies and procedures that comprise that credit union’s unique CMS. Just another way for Credit Union Compliance, Keep Your Guard Up!

To think of it another way, if each credit union is a dynamic and evolving operation, then it only makes sense that the CMS policies and procedures that guide that credit union’s day-to-day operations must also adapt and change over time to ensure they remain appropriate for the way that credit union conducts its business. Compliance violations happen, and stale policies and procedures are often the culprits. There’s no getting around the fact that when employees focus on the day-to-day business of running the credit union – making loans to members, assisting them with their share accounts, and providing the ever-expanding range of financial products that seem to develop overnight – every employee is constantly making real-time decisions about what to do and how to do it.

Although wandering off the path of strict compliance is rarely a conscious decision, without careful consideration of the compliance implications of a particular process or procedure, what may seem like an expedient solution to a day-to-day operational problem may turn out to be a shortcut to a compliance violation. Like an impulsive decision to leave the trail on a desert hike, not understanding the compliance implications of a policy change or an adjustment to a longstanding procedure can be fraught with risk. This common dilemma, faced by credit unions and financial institutions of all sizes and types, has been the subject of recent efforts by the Federal Government to stay abreast of the changing compliance landscape.

Evaluating Compliance Risk

As part of a joint project with other federal financial regulators under the auspices of the Federal Financial Institutions Examination Council (FFIEC), the NCUA released Supervisory Letter No. 17-01, Evaluating Compliance Risk – Updated Compliance Risk Indicators. It discusses the recently updated criteria that NCUA examiners will use when assessing how well a credit union meets its compliance obligations. The updated list of compliance risk indicators makes it clear that regulators will be looking not only for compliance with specific regulations but also at the overall effectiveness of each credit union’s compliance management system. Examiners assessing compliance risk will evaluate each credit union’s CMS with respect to: 

• Oversight Commitment – How well do the credit union’s management and board of directors understands all aspects of compliance risk; and how strong a commitment do they show to providing sufficient compliance resources, staff, and training to ensure that the credit union will meet its due diligence obligations?
• Change Management – How well does the credit union’s management anticipate and respond to changes in applicable laws and regulations; how well does it react to changes in market conditions; and how thoroughly does it consider compliance implications when it implements changes to its products and services?
• Comprehension, Identification, and Management of Risk – Does the credit union have a strong culture of compliance management designed to minimize the likelihood of serious compliance violations; does management effectively identify compliance risks posed by the credit union’s products, services, and other activities; and does management effectively manage those risks through comprehensive self-assessments?
• Corrective Action and Self-Identification – Does the credit union proactively identify and promptly respond to compliance risk management deficiencies and violations of laws and regulations, including taking corrective action?

Key Factors in Evaluating Compliance Risk

The Supervisory Letter outlines other key factors that examiners will look at when evaluating a credit union’s compliance program: 

• Policies and Procedures – Are the credit union’s compliance policies and procedures and third-party relationship management programs adequate to manage the compliance risk posed by the credit union’s products such as forms and disclosures, services, and activities?
• Training – Does the credit union’s compliance training adequately outline staff responsibilities, and is training provided in a timely manner in connection with changes in laws and regulations and the rollout of new products and services?
• Monitoring and/or Audit – Are the credit union’s compliance monitoring practices, management information systems, reporting, compliance audit, and internal control systems adequate to address compliance risks throughout the credit union?
• Consumer Complaint Response – Are the credit union’s processes and procedures for addressing and monitoring consumer complaints adequate, and does the credit union conduct consumer complaint investigations promptly and thoroughly?

Examiners will also determine the extent to which compliance violations result in harm to consumers. Compliance violations will be evaluated in terms of: 

• Root Cause – To what extent are violations the result of weaknesses or deficiencies in the credit union’s CMS?
• Severity – Do the violations cause serious and considerable harm to consumers?
• Duration – How extensive is the time frame during which a violation occurred?
• Pervasiveness – How widespread and numerous are the violations?

Effective March 31, 2017, the FFIEC updated its Uniform Interagency Consumer Compliance Rating System. The five-level rating system that has long been used to rank a credit union’s compliance with consumer compliance regulations evaluates three broad categories, the first two of which are focused on the credit union’s CMS: 

• Board and Management Oversight
• Compliance Program; and
• Violations of Law and Consumer Harm

The consumer compliance rating (CC Rating) that a credit union receives is a critical measure of that credit union’s health. Compliance is measured on a scale of 1 to 5, with a CC Rating of 1 being the most coveted. A poor rating in the 3 to 5 range is a red flag that will not be ignored and will result in a credit union having to expend considerable time, effort, and resources taking the necessary measures to correct the problems revealed by the examination. Obviously, this renewed emphasis on compliance by federal regulators means that any efforts that a credit union takes to identify and correct compliance issues in advance of a consumer compliance examination will be beneficial. But waiting until an examination has been announced may be too late to do anything about it. The best approach is to instill a culture of self-assessment and to regularly evaluate each of the credit union’s products, policies, procedures, and processes for compliance. Like being properly prepared for a hike through the desert, it only makes good sense.

Credit Union Compliance, Keep Your Guard Up!

Take advantage of Oak Tree compliant forms and obtain compliance support for your credit union. Remember when it comes to Credit Union Compliance, Keep Your Guard Up! You don’t have to do it alone.

(note: this is an older blog entry and has been edited since originally posted.)

5 Types Found at Credit Union Events

5 Types Found at Credit Union Events

It’s clear that events are a colossal part of the credit union industry. From community credit union outings, local chapter meetings, annual league meetings, national conferences, technology symposiums, and international training events, there always seems to be an event happening in the credit union world. We know there are more than 5 types found at Credit Union Events, but there are some we see at all events.

It’s important to attend events to stay up to date with credit union industry news, regulations, and be aware of challenges other credit unions have faced, and how they have overcome these hurdles. In addition, it is a great opportunity to come together and share ideas with other industry leaders. Events are also a great way to meet with vendors and to learn about new technology that may benefit your credit union by saving time and money, like the credit union forms solutions from Oak Tree Business Systems, Inc. With all the commotion going on, it may be hard to filter out what events are worthwhile and which ones can be skipped. After asking credit union executives, Oak Tree has provided some guidance on how to select an event to attend.

The two biggest factors for deciding what event(s) to attend were the price of the event and the topics covered. Attending any event has a cost associated, so it is important to know ahead of time what budget your credit union has to spend on such events. Not to mention your valuable time out of the office must produce results upon your return to the office. Here is a tip; most credit union events will have scholarships that you might be eligible to procure. So, be sure to read all the event details or ask the event coordinator if they offer any scholarship options. As far as the topics covered, most large events will have an agenda posted prior to the event that will list the overall focus of the meeting, who will be speaking, if sponsors/vendors will be there, and who those sponsors are. This agenda is a great way to gauge if you will truly benefit by attending, as it will let you know if there will be training, hands-on experience with the systems or technology, compliance updates, or networking opportunities.

The date and location of the events are the next factors to keep in mind when determining what event to attend. Travel, hotel, and time spent outside of the office can add extra cost to attending an event. If your budget is small, travel may not be an option. Instead, research your local league or chapter website to see what is happening near you. These websites may also have useful webinar training links available. The length of the event, as well as time of year, is also important to consider. Even a great event may conflict with important deadlines at your credit union. If there is a conflict, there may be other options to still learn about the topics covered, such as downloadable worksheets, the podcast of the event speakers, or even a second date/location of the same event.

Five different types of people at credit union events

1. The Networker: He or she always has a business card handy and ready. The Networker is on the lookout to meet someone new to engage in an insightful conversation about what is going on around him or her in the credit union industry. 
2. The #SocialMedia Guru: The Social Media Guru always has their phone handy, taking pictures for social media. He or she is taking advantage of the conference/event hashtags in their social media updates and is sharing photos with their coworkers back home. If the event has an app, he or she definitely has it downloaded and in full use. @OTBS_CUforms 
3. The Question Asker: He or she is hungry to know more about the topic at hand. They have many questions and are not afraid to ask. The Question Asker came to the event with a purpose, and the purpose is to learn! Nothing is going to stop him or her from inquiring about a question they need to know the answer to.
4. The Quiet One: He or she is quiet, but this does not mean that they are not fully engaged in what is going on. The Quiet One is silently thinking and absorbing all of the information that is presented to him or her at a conference or event. It will be the quiet one who applies the information back at the office that will positively affect your credit union.
5. The Booth Visitor: Whether he or she is collecting the free handouts at the booths or trying to learn about new businesses/technology, this person is sure to stop at all and any vendor booth.

What is your biggest state event? Comment to let us know.

Checklist for Credit Union Compliance

It takes work to keep your credit union in compliance. It’s not easy, but there are a few basic things you can do. Read over our checklist and make sure you have these items covered. This will go a long way toward keeping you in compliance and out of the crosshairs of a potential regulatory audit, or other adverse events. Of course, there are so many things that come into play when keeping your credit union compliant, but this quick checklist for credit union compliance gives a good generalized overview.

Stay Current.

Make sure you stay in the loop regarding regulatory changes and other similar occurrences. Most vendors have websites devoted solely to timely information updates; and regulatory agencies such as the NCUA, Federal Reserve, Federal Financial Institutions Examine Council (FFIEC), and Consumer Financial Protection Bureau provide white papers and summaries to give perspective on updated laws and regulations. These help you stay up to date and informed.

Audit & Review Yourself.

Make sure you have a mechanism in place to review and audit your policies and procedures. The best way to think of these is as follows: they are always a work in progress. They should regularly be reviewed and tested to find shortcomings or problems that might be hidden from view.

Be Proactive.

Learn to anticipate regulatory changes. This is best accomplished by studying trends, and observing how other regulatory professionals in your industry are reacting. Speculate using past and current regulatory trends, then take all of this information and extrapolate a conclusion based on the inferences and present regulatory situation. Usually, you can align facts with trends to determine what will most naturally be the next course of action, and begin to position yourself accordingly.

Be Consistent.

Make sure you have a mechanism in place to maintain all current programs. This means reports should be submitted on a regular basis, updates should be regularly given, budgets should be maintained, and a plan for training staff should also be in the works. Oak Tree forms fit nicely into this category. All of our forms packages are kept current and up to date, providing you with the security and peace of mind needed to focus on other compliance issues.

Use the tips above as general guidelines. They are helpful with regard to perspective, and provide a broad-brush approach, allowing you to hone in on specifics as they relate to your institution.

Finally, if you are a compliance officer, set up a process for auditing yourself. This can be vital in preventing problematic instances in the long run. Maintaining compliance is a key part of credit union operation and management. It is a tough job with no guidebook or definitive set of rules. It takes everyone working together to ensure compliance is met and maintained. It is an ongoing necessity that must be upheld to meet members’ needs. We hope these tips and checklist for credit union compliance comes in handy for your credit union. Take advantage of Oak Tree compliant forms and obtain compliance support for your credit union.

What a CU Needs to Stay Compliant

While credit union compliance may have been under the radar just a decade ago, a recession, global pandemic, and going digital have all contributed to a multitude of new regulations and an emphasis on compliance. So let us look at what a CU needs to stay compliant because you need to keep your credit union compliant.

Utilizing a proactive mindset can prevent costly compliance litigation and fines. We have assembled a checklist to help you assess your CU’s compliance strengths and risks.

Regulations

It’s important to stay diligent. Implementing a plan to stay compliant is necessary to fulfill CU strategies for growth and longevity.

Regulatory agencies such as NCUA, Federal Reserve, Federal Financial Institutions Examination Council (FFIEC), and Consumer Financial Protection Bureau provide updated information on laws and compliance.

1.Study past and current trends.

Use the facts you have and projected trends to create a plan of action.

2.Execute a plan.

Create detailed reports, update budgets, and keep staff trained and informed on any changes.

3.Audit yourself.

As regulations change, so should your products and processes. Continuously think about how you can improve and decrease any weaknesses.

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Good Partners

Networking with other credit unions to talk about compliance is important not only for your branch but CUs as a whole. By finding out how others view compliance issues and how they have resolved those same issues can save you from future costly mistakes. What a CU needs to stay compliant sometimes is a good partner to watch their back.

Plus, if you place importance on forming a network of CU executives, you will have someone to call. Picking up the phone is much easier than taking a deep dive into compliance blogs or manuals that might not even fully answer your specific question.

Once you foster a friendship with several local or regional CUs, consider forming a committee that focuses on compliance. That way when any regulatory changes are introduced, you can talk about them as a committee and forward that information to everyone involved. This collaboration is a hallmark of the CU world, an advantage over most banks that prefer to keep a corporate distance.

For example, Washington State Employees Credit Union (WSECU) organized a consumer protection compliance committee back in 2014 in response to the Dodd-Frank mortgage rules and state examinations. As CUs need to conform to a growing list of regulations, the committee provides oversight and guidance to the CU’s management of compliance.

Tools

The Federal Financial Institutions Examination Council (FFIEC) provides three compliance resources that are worth adding to your toolbox. These free resources are a great addition to your current setup and can fill gaps when your budget is minimal for data compliance. What a CU needs to stay compliant is the proper tools.

FFIEC Information Technology Examination Handbook

The FFIEC IT Exam Handbook is the main guide used to assess compliance by auditors. Although it offers an outline for audits, it does not include everything. An auditor may suggest changes that aren’t included in the handbook.

FFIEC IT Exam Handbook includes information on the following topics:

• • Allocating staff and technology to information technology
• •Organizing an established information security culture within your CU
• •Defining risk identification processes
• • Risk monitoring and reporting
• •Consistent security operations

FFIEC Cybersecurity Assessment Tool (CAT)

Credit unions have access to the Automated Cybersecurity Examination Tool (ACET) which is based on the CAT. The ACET provides easy-to-interpret results that are easy to implement. This is an improvement over a standard PDF.

CIS Controls® (CIS)

For cyber-attack prevention, this free tool is a great addition to credit union cybersecurity programs, whether you build your own or use a third-party solution.

Online Security

Members of credit unions switch from traditional banks to experience an increase in personalized customer service, security, and trust. Online security is a key component of trust as members continue to lean toward digital products and processes.

As part of maintaining compliance, security monitoring is key in protecting your members’ information. By consistently following these three steps you can prevent future cyber-attacks.

1. Find Your weaknesses

Consistently check for weaknesses in your CU’s security monitoring. It is impossible to efficiently monitor your credit union logs manually. Using a security operations center (SOC) can provide cybersecurity 24/7.

2. Create a Plan

Once you start using a SOC, single out your vulnerabilities to see which ones need attention.

3. Fix Vulnerabilities

IT teams can benefit from a patch management system to fix vulnerabilities and keep them from creating a larger issue. This system saves man-hours by removing the task of manually determining which issues need a patch.

The Cloud

Cloud security is used by 75% of credit unions. The protocol of cloud security compared with traditional methods is virtually the same.

Involve Your Members

Keeping your members educated about their overall cybersecurity can help decrease cyber-attacks and even fraud. Over 80% of hacking-related breaches are due to weak or stolen passwords.

Simply adding password requirements to member accounts like character length, a mixture of both lowercase and uppercase letters, numbers, and special characters will help protect sensitive member information. You can also add multi-factor authentication as an additional layer of online protection.

ADA

Website and mobile apps should be secure, and also follow the Americans with Disabilities Act (ADA) guidelines.

Choose a web developer or ADA agency to audit your site to ensure that you are compliant on all devices including desktops, tablets, and mobile phones. They can also check to see if your site is accessible through text readers and audio scanners.

Post-Coronavirus World

As credit unions have catered to their members during coronavirus in the form of pandemic-specific products and processes, this new way of doing business has opened up a whole new set of regulatory changes and compliance issues.

New trends, such as digital notary signings, have changed the way credit unions complete the loan process. CUs also had to put a priority on the government-issued SBA Paycheck Protection Program to fully serve its members struggling to fund their small businesses during the pandemic. With the increase in remote member transactions, it’s important to protect members against fraud not only during the coronavirus but post COVID-19 as well.

The silver lining from coronavirus is the opportunity to test remote work among credit union employees and digital products and services for CU members. As credit unions set future risks, goals, and marketing strategies, compliance is at the forefront of success. All of these changes required swift compliance action from training, to sensitive advertising content, as well as reforming loan processes.

As the global pandemic continues to shape member preferences toward digital, it’s a great time for CUs to re-think strategies regarding member engagement and how that affects their brick and mortar world.

Avoid excess anxiety about compliance by networking with other CUs, taking advantage of free resources, and investing in online tools that will keep your CU compliant and your members’ information secure.

Migrating to Chip Cards for Security

Keeping data secure is always a top priority for Oak Tree. It`s one of the reasons we offer data integration with our forms packets. Data integration makes credit union business more efficient and safer for the members and institution. Yet the fight for data security is ongoing. New mandates and regulations have chip card processing vendors on their toes. Most industries are required to be in compliance by the end of the year or face fines. It is time for your credit union to look at migrating to chip cards for security if it has not already done so.

The move is an effort to protect client data. Chip cards work by linking customer data to a small EMV (Europay, MasterCard, and Visa) chip on the face of the card. It offers more security than traditional magnetic stripe cards. Here are three security feature highlights.

3 Reasons Chip Cards Are Safer Than Their Magnetic Stripe Counterparts

• Fraud. Chip cards prevent people from making purchases by physically swiping a fraudulent credit card. It works. Many places have seen these types of purchases all but eliminated.
• Cloning. Chip cards are extremely difficult to clone. Magnetic cards are much easier. The reason is, magnetic cards make use of static data. A $20 skimmer is all a thief needs to create a clone. Chip card data is dynamic. It always changes. In order for a data hack to occur, a thief would need to access the chip`s physical circuitry.
• Better Encryption. Magnetic stripe cards broadcast data through the reader as-is. Chip cards encrypt the language as soon as it “dips” into the reader. The card communicates with the merchant through secure encryption the entire time.

This is why migrating to chip cards is one of the best long-term moves for member security. Chances are, chip cards will undergo a few rounds of revision over the next few years to streamline security and data linking. Our forms will remain constant, though. Always compliant and accessible when you need them, they are the perfect companion to ensure the entire chip card application process is secure.

When it comes to Credit Union Consumer Lending Documents and Data Linking Services, Oak Tree is here for you.

CU Events Roundup Mar 26, 2021

Welcome to this week’s CU Events Roundup for Mar. 26, 2021, where we will look at the Credit Union community and bring up some of the events we see going on. Oak Tree loves keeping tabs and participating in these credit union events.

We are hopefully on the tail end of this pandemic that has disrupted so much, including the events that we often participate in for our industry. We know that there are some “LIVE” events coming up soon, as well as at least one Virtual/Live event. Stay tuned on those and more. Let’s look at CU Events Roundup Mar 26, 2021.

This Past Week

CUNA Marketing & Business Development Council Virtual Conference

This past week was the big Marketing and Business Development Council Conference put on by CUNA. They held 13 sessions over three days to help their council members. If you were a part of it, let us know how it went!

NAFCU Virtual Regulatory Compliance School

NAFCU Virtual Regulatory Compliance School is wrapping up today and that means there are a bunch of upcoming Compliance Officers in the credit union field. I hope they all know how much Oak Tree puts importance on compliance for credit unions!

Next Week’s Events

We saw online at 10times that NACUSO Network Conference was supposed to take place at the end of March, but it looks like they rescheduled this for a live event in November. So who is ready to go to Las Vegas in November? We might have to check this event out!

Coming Soon

School of Business Lending™ II: Financial Analysis and Diagnostic Assessment put on CUES next week, it will be virtual.

The Ohio Credit Union League usually has their inVest48 event around this time, but don’t worry — we saw they have it in May this year!

Speaking of events moving to later in the year, we saw that the NCPCU is doing their Strategy Summit in October this year.

That will do it for CU Events Roundup Mar 26, 2021.

We hope you like this feature and we look forward to seeing how it can grow moving forward. If your credit union, credit union league, or credit union chapter has a big event coming up — drop us a comment or hit us up on social media.

Want to Be the New CEO of a Credit Union?

Have you ever wondered what it takes to be a qualified chief executive officer (CEO)? The simple answer is that it takes a lot. At the top of the list are schooling, confidence, determination, and work experience to accomplish the ultimate goal. Do you want to be the new CEO of a credit union?

Let’s first lay out what a CEO does.

A CEO’s role is regarded as one of the highest-ranking positions in a corporation. This entails making top managerial decisions. They manage the company’s success and avoid failures. They are able to take on the complex challenges a credit union faces while being on high alert about what is going on in the industry. Also having an open eye for any opportunities that will tend to change helps.

How does that sound to you?

The transition from a regular job to a higher position can be a shock factor due to the many responsibilities the role entails. It is always smart to learn and absorb as much information as possible before taking the next big step. Looking at it from another perspective, being in a high position also comes with the cost of making sure that you are taking the right steps to ensure that the credit union you are leading will be successful. The role comes with a lot of responsibilities that include travel, representation of the company (looking presentable), and being confident in speaking to many people within the company and at events.

How can I feel more confident in an upper managerial position?

Advice that we can give to anyone in the stage of wanting to change their position, is to learn as much as they can from the CEO. Ask to attend events, meetings, and interviews to see what kind of language is used and how to interact with different people.

You got this! Don’t let anyone stop you from achieving this goal! Work hard and know that hard work pays off.

A note from Richard Gallagher, CEO of Oak Tree Business Systems.

“From the beginning of my career, I have worked my way up to the CEO position by working hard and learning as much as I could about the credit union industry. I have made my way up and have always had set goals of where I wanted to end up and wanted to accomplish. Coming in as the new CEO of Oak Tree Business Systems, I had a fresh mind and a new set of ideas to get the ball rolling. With my extensive background, I am thankful for all of the past work experiences I had to help me achieve a successful career. From where I am today, I look back at myself and would give myself a hand on the back for never giving up and always striving for greatness. There was a time in my position where I had an itch to travel all over the U.S. to talk to our clients and potential prospects for a way to introduce myself but to also get my name out there. I strive to always think of solutions and talk to fellow credit union families about what forms and disclosures they are lacking in their establishment.

Advice that I can give to future CEOs is to always want to learn. Be the first one at the meeting and the last one to leave. Get your name out there. Learn about every nook and cranny of the credit union industry. LEARN EVERYONE’S NAME! Be friendly and be present.”

Time to ask yourself if you want to be the new CEO of a credit union and if you are ready to do what needs to be done in this pursuit.

On another note, Oak Tree continually refines its loan forms system to provide the best combination of compliance, practicality, and contemporary design. Oak Tree is committed to each individual credit union to work on your behalf in designing, producing, and supporting an effective lending system. We are fast, efficient, knowledgeable, mindful of costs, and dedicated to the credit union industry. Of specific interest is the continuing training and support we provide. You will have unlimited, free telephonic support in addition to our on-site activities. When you call Oak Tree, you always get real, live, knowledgeable people who will help solve your problems. Just like a CEO advocating for their institution, we got you covered!

CU Events Roundup Mar 19, 2021

CU Events Roundup

Welcome to this week’s CU Events Roundup for Mar. 19, 2021, where we will look at the Credit Union community and bring up some of the events we see going on. We love keeping tabs and participating in these credit union events. CU Events Roundup Mar 19, 2021.

We are hopefully on the tail end of this pandemic that has disrupted so much, including the events that we often participate in for our industry.

Louisiana’s Credit Union Connect

An annual event we like to keep up on and try to help out is the Credit Union Connect put on by the Louisiana Credit Union League and it is often around this time. Turns out it has been canceled for 2021, but we look forward to its return in 2022!

Check out their site for other upcoming events, though — including their 2021 Louisiana GAC.

This Past Week’s Events

There were a lot of roundtable discussions and annual meetings, so we can’t keep track of them all — but feel free to let us know how your Credit Union’s Annual Meeting or event went in the comments or our social media. We love engaging with credit unions!

Did you see that the NAFCU held their Annual Regulatory Compliance School event as a virtual event, did you participate?

Not exactly “credit union” related, but how was your St. Patrick’s Day? Did your credit union do anything special?

Next Week’s Events

Next week it looks like there will be the CUNA Marketing & Business Development Council as a Virtual Conference, will you be participating? You know how much Oak Tree values marketing, and we know your credit union will only see its membership rosters grow with the right credit union marketing and the best credit union forms!

Coming Soon

Houston’s Credit Unions will soon be hosting their March Chapter Meeting, are you attending?

That does it for CU Events Roundup on Mar 19, 2021. We hope you like this feature and we look forward to seeing how it can grow moving forward. If your credit union, credit union league, or credit union chapter has a big event coming up — drop us a comment or hit us up on social media.

Credit Union Information Governance

Is Information Governance Important to Credit Unions?

What do you know of credit union information governance? Nothing is more important to a credit union than compliance, and one of the biggest components to this is information governance. This term may not be so familiar to those outside of the financial sectors or corporate cultures, but it is something that has become more important with each passing day. Every company, especially credit unions, must contend with a myriad of ever-changing laws, compliance issues, competition, economic uncertainty, and the malicious hackers and criminals that are always a danger to their assets, which contributes to growing concern. Information governance is nothing more than the protocols put in place for any organization to keep its information secure, yet usable. It is being meticulous and disciplined in the collection, management, and output of any information or data in a corporation.

As more credit unions expand their use of fintech, we see a need for them to also bolster their practice of information governance. This has led to the growing need to be more careful with the bulk of data that has been collected. Especially as more states and even the federal government have begun to craft new regulations and controls on how such data can be used, how it must be curated or stored, and of course how to handle the liability issues if an organization is breached. Then there are also the resources used to collect, store, and safeguard this data as a cost to the corporation in comparison to the lifecycle of its usefulness or reliability.

Credit Union Liability Issues

Besides liability issues or the need to stay compliant, we have also seen that when credit unions craft and implement more stringent and careful protocols for their information governance it comes back to that very important shareholder – the member. Protecting the information on your members is also about protecting them from fraud and other abuse. It gives them confidence in your institution when they know that their information can be trusted with your credit union. This is just one more way to build that goodwill and reputation that helps every company survive through the most severe of situations.

There are many instances where it may seem that the data you have is at risk, and this can be very true when dealing with vendors. Oak Tree has been a trusted vendor and we completely understand and respect the need for such controls on sensitive data. Staying compliant doesn’t just mean being aware of the law, it is meant to protect all of us and allow us to feel accommodated.

Oak Tree Business Systems has been in the credit union industry for over 37 years, so we can say that we are confident, and encourage all credit unions to use our forms. We comply with both state and federal standards, meet the expectations of each credit union’s members and staff, work on each credit union’s data processing system (and within their policies), and have an effective compliant forms system.

ITIN Lending & Compliance

Cutting Through the Fog

In a Credit Union Times Expert Opinion Column, “ITIN Lending & Compliance: Cutting Through the Fog,” Oak Tree`s CEO talks about ITIN lending, and how it represents growth opportunities for credit unions. Here is an excerpt from the article about ITIN Lending & Compliance:

” ITIN lending represents a solid marketing demographic for credit unions. Is your credit union taking full advantage of it? If not, you should be. Here’s why. The Filene Research Institute recently concluded its incubator loan project in December 2017, with ITIN lending being the most popular segment of the experiment.

The program introduced the following five loan packages to immigrants/minorities:

• Automobile refinance loans
• QCash small-dollar loans
• Micro-finance small business loans (community-based)
• Payday payoff installment loans
• ITIN lending

To make these loans possible, credit unions used targeted data mining and alternative relationship factors in addition to credit scores, alternative data, and ITIN numbers rather than Social Security numbers as a basis for identification. And while this segment does carry risk, it can be measured. Plus, the numbers speak for themselves.”

To continue reading about ITIN Lending & Compliance, head over to Credit Union Times website HERE.

Oak Tree has been a leading provider of credit union forms and disclosures for over 37 years. Contact us for information regarding our forms or marketing services.

Navigating Current Lending Trends

Navigating Current Lending Trends for Growth and Compliance

Following current lending, trends can boost loan applications and approvals. It can also spark new partnerships and provide a competitive edge in a volatile market. Let’s look at navigating current lending trends for growth and compliance; and how they can help your credit union grow.

How do I encourage membership growth?

CUs generally have lower loan rates, higher rates on savings and investment accounts, and fewer fees. While credit unions focus on securing memberships from younger generations, it’s important not to discount lending to small and mid-size businesses.

Due to economic uncertainty, small business owners are forced to seek online lending options. Online lenders are dominating the market with higher percentage approvals and quick funding.

Small businesses are worth the acquisition cost since most will need additional products like checking and savings accounts. A positive CU experience could solidify a long-term client both for business and personal financial needs.

How do I increase equipment loan approvals?

Once you have established relationships with small and mid-size businesses, they will likely need additional loans such as equipment financing. While it’s easy to put a business owner into a box by only recognizing his credit score or actuarial models, that box doesn’t meet the needs of today’s business owner.

Does the owner have collateral? Cash flow? Do they have a good reputation with your CU? All of these factors should also influence loan approval.

By underwriting each equipment loan, you can personalize the experience and collect pertinent data that can help upsell additional products and services.

Take the time to get to know local industries that are seeking loans. Do you understand their equipment needs? Are they able to source new or used equipment?

Establishing genuine care and concern for each business member’s needs can generate referrals and build trust among industries. Running a business in any industry is difficult and understanding the needs and unique financial mistakes can help your CU provide solutions to keep those businesses running without a hitch.

How do I go digital without losing members?

By 2025, it is estimated that over half of tasks currently held by various credit union personnel such as loan officers, tellers, and financial advisors could be automated according to Accenture. Although going digital could save financial institutions billions of dollars, it also affects the ability to provide a human experience, a touchpoint that credit unions rely on.

However, going digital doesn’t have to mean slashing the workforce or giving your members the cold shoulder. For example, OceanFirst Financial in New Jersey retrained its employees to assist digital banking roles.

Even though OceanFirst closed over 1/3 of its branches, through its employee retention efforts and forward-thinking mindset, it was able to keep over 90% of members who banked at the closed branches.

By adopting digital processes, OceanFirst also witnessed an 81% increase in mobile deposits (2019). Investing in retraining their employees not only educates their staff on digital processes but provides growth and sustainability for their coverage area.

Why should I partner with fintech?

As the need for a personalized digital banking experience paralyzes credit unions, fintech can provide the perfect partnership.

Your CU doesn’t have to become fluent in online coding or start from square one. By partnering with fintech companies, credit unions can expand their network of businesses, and simplify the loan process to engage more members at a faster pace.

This strategy is particularly important for CUs that lack manpower and budget in the areas of risk, underwriting, and compliance.

Fintech can also help CUs gather data analysis regarding their potential and current membership. The data measures credit risk allowing the credit union to understand the borrower’s financial behavior before a transaction has commenced.

By using smart credit risk technology, CUs can feel comfortable approving the loan, even if traditionally the borrower may have questionable credit on paper. This is the main avenue fintech uses to speed up loan approvals.

It’s important to choose a fintech early in the game. As fintech gets more established the rates start to increase, which means the cost of partnership can as well. Coronavirus has forced scenarios we have never conceived before. Only being able to communicate via a virtual world is right up fintech’s alley so take advantage of their automation techniques in personal and small business lending.

What’s next for the U.S. economy?

Since 2000, credit union lending as increased in both first mortgage and auto. Totaling $81.6 billion (26.0% of all credit union loans in Q2 2000) and $440 billion in Q2 2019 (41.1%), first mortgages have seen an increase of over 15%. Auto loans have increased too from $123.6 billion in 2000 to $374.4 billion in 2019.

However, 2020 has ushered in a global pandemic, social unrest, and an economic downturn. With all of these factors, it is unlikely that the nation will be as strong economically as it was between 2015-2019. Here are 3 factors that could limit economic growth in the next couple of years.

1. Political Uncertainty

President Trump frequently tweets and according to JP Morgan, those words go way beyond social media banter. JP Morgan nicknamed the tweets the ‘Volfefe Index’ after a confusing 2017 “covfefe” tweet. These specific tweets are showing a significant impact on Treasury yields.

Depending on the content, tweets affect volatility in the market which affects the pricing of options and securities.  As the November election looms, uncertainty in the market is considered commonplace.

2. Low Inflation Rate

A low inflation rate is meant to keep the recovery going. However, when inflation rates are already low, cutting them can make a weak economy weaker.

The probability of an additional 25-basis-point rate cut averaged approximately 87% for contracts expiring between the end of 2019 and September 2020 as found by the Federal Reserve Bank of Atlanta’s market tracker.

3. Future Economic Trends

As a higher ratio of Americans is retiring, the U.S. has seen a slowdown in productivity. Less productivity means less economic growth. This decline of economic growth along with a decline in consumer spending could be problematic for a quick economic recovery.

Even with lending wrapped up in the chaos of economic uncertainty, now is the time to invest in technology and comply with industry regulations to stay competitive. Listening to the needs of your members can help your CU weather economic uncertainties. Here at Oak Tree we follow the lending trends in the credit union industry and are here to help you adapt. What’s your feedback on navigating current lending trends for growth and compliance at your credit union?

Community Charity Campaign Success

PRESS RELEASE Oak Tree Business Systems, Inc. teamed up with local charities, including the OC Foodbank and the 2020 Community Cup Charity, to give back to the surrounding communities. Credit unions, employees, members, families, and friends were asked to help us in this fight against hunger. Community Charity Campaign Success!

With community support, Oak Tree Business Systems, Inc. donated more than 100 pounds of food and over $300 in online donations to the OC Foodbank. We thank Capstone Federal Credit Union and The Irvine Company for their support.

“The OC Food Bank works with nearly 400 local charities, soup kitchens, and community organizations to end hunger and malnutrition. CAPOC personnel distributes over 23,000 food boxes each month at 55 distribution sites in Orange, Los Angeles, and Riverside Counties. The program provides nutritional assistance to relieve situations of emergency and distress through the provision of food to the poor.”

About Oak Tree Business Systems, Inc.

Now celebrating over 37 years of experience in the Credit Union Industry, Oak Tree is a leading provider of compliant lending documents and forms for credit unions. We provide all types of forms (in all formats), data linking services, training, compliance support, legal opinion letters, marketing services, Spanish forms, preprinted brochures, and documents, as well as web-based forms.

For more information on Oak Tree Business Systems, Inc. please visit the Community Charity Campaign page.

(note: this is an older blog entry and has been edited since originally posted. Community Charity Campaign Success!)

Community Charity Campaign

Helpful Humanitarians | Credit Union partner

Helpful Humanitarians

PRESS RELEASE Oak Tree Business Systems, Inc. is teaming up with local charities, including the OC Foodbank and the 2020 Community Cup Charity, to give back to the surrounding communities. We are asking credit unions, employees, members, families, and friends to help us in this fight against hunger. To join our team, please email us; the deadline to sign up is Aug. 28. The project will run from Aug. 1–Sep. 11, and those who wish to participate will be asked to leave out marked bins at their branches to collect donations. (Note: this community charity campaign is now over)

This is a great opportunity for your credit union and credit union family to get involved and help those in your community even further, virtually and physically during COVID-19.

“The OC Food Bank works with nearly 400 local charities, soup kitchens, and community organizations to end hunger and malnutrition. CAPOC personnel distributes over 23,000 food boxes each month at 55 distribution sites in Orange, Los Angeles, and Riverside Counties. The program provides nutritional assistance to relieve situations of emergency and distress through the provision of food to the poor.”

About Oak Tree Business Systems, Inc.

Now celebrating over 37 years of experience in the Credit Union Industry, Oak Tree is a leading provider of compliant lending documents and forms for credit unions. We provide all types of forms (in all formats), data linking services, training, compliance support, legal opinion letters, marketing services, Spanish forms, preprinted brochures, and documents, as well as web-based forms.

(note: this is an older blog entry and has been edited since originally posted. The community charity campaign is now complete to great success!)

TRID & What It Means for Your Forms

TRID & What It Means for Your Forms at Your Credit Union

In a commentary article posted on Credit Union Times our CEO, Richard Gallagher discusses TRID and what it means for your forms. For Credit Unions, TRID requires not only adjusting model forms but also includes changes to computer software. Picking the right business partners to satisfy the TRID disclosure requirements is more critical than ever, and a reliable document provider is every bit as important as finding a qualified loan processor. 

What do you get when you attempt to abbreviate “Truth-in-Lending Act,” “Real Estate Settlement Procedures Act” and “Integrated Disclosures?” Well, if you are the CFPB, you get TRID, an acronym for two consolidated consumer real estate loan disclosure forms that represent many years and countless hours of research and development. The TRID forms consolidate two separate loan disclosures that had been required for decades by two different federal consumer protection laws and regulations recombining them into two different forms; one to be provided at the time of application and the other, at the time a closed-end consumer real estate loan is closed. For those wanting to dig a little deeper, let’s break this down.

On Aug. 11, 2017, the CFPB published a Final Rule in the Federal Register to formalize guidance and to provide greater clarity and certainty regarding specific mortgage disclosure provisions implemented by Regulation Z (2017 TILA-RESPA Rule). Although the Final Rule became effective on Oct. 10, 2017, 60 days after publication, compliance is not mandatory until Oct. 1, 2018. Confused? Aren’t the TRID disclosures already required? Let’s back up and review.

Richard Gallagher

To read more about TRID and how it affects your credit union, go check out the CU Times article and then check out our home equity lending documents for your credit union.

_{(note: this is an older blog entry and has been edited since originally posted.)}