Disclosures for Non-Federally Insured Depository Institutions under the Federal Deposit Insurance Corporation Improvement Act (FDICIA) #540033-00011

Submission Number:
Tim Boellner
AurGroup Financial Credit Union
Initiative Name:
Disclosures for Non-Federally Insured Depository Institutions under the Federal Deposit Insurance Corporation Improvement Act (FDICIA)
June 2, 2009 Federal Trade Commission/Office of the Secretary Re: Supplemental Proposed Rule for FDICIA Disclosures, Matter No. R411014 Dear Sir/Madam Secretary: I am writing in opposition to your agency’s supplemental proposed rule governing consumer disclosure requirements for privately insured credit unions, specifically, as they affect signage at shared branches. AurGroup Financial Credit Union, a state-chartered, privately-insured credit union has been in business since 1934. We serve 3 counties in Southwest Ohio (Greater Cincinnati area), as well as multiple sponsor groups, which include Mercy Hospital, Fairfield City Employees, Duke Employees (Utility company), and the educators and the staff of the school systems in Butler County. Our membership consists of roughly 19,000 members comprising $125.5 million in deposits. Additionally, we have 5 full-service branches which are open to shared branching. We participate in the shared branching network through CUSC, and it provides a valuable retention tool for maintaining credit union membership after members relocated elsewhere. Additionally, it is extremely convenient for current members to utilize other facilities in our urban environment, as we cannot put a branch on every street corner. It also provides convenience for members, who travel to outside the area for business or pleasure. The shared branching network contracts are unable to be amended to meet the terms of the FTC’s proposal of signage in other credit union’s (federally insured) branches. Frankly, the proposal is unrealistic to implement when you think about 3,700 shared branching facilities nationally, of which only a small portion are privately insured, not to mention confusing to the member. I can assure you that there is sufficient signage in all 5 of our branches disclosing that we are not federally insured, as well as other privately-insured shared branching providers. A shared branching transaction is typically a mundane transaction, such as a deposit, withdrawal, loan payment, or inquiry about the member’s account balance. The member is probably more concerned about the transaction, than all of the signage that this proposal would require. These transactions are in layman’s terms, a human ATM transaction, as the items processed are similar to what is completed at an ATM (cash withdrawal, deposit, account inquiry, loan payment, etc.). I cannot imagine applying the same logic of signage to all of the ATMs nationally, as it would be confusing for the member, not to mention bank customers, who use our ATMs. Additionally, almost all of our shared branching transactions are completed by tellers, who happen to be our least seasoned employees. Can you imagine the training that would have to occur for tellers to know whether the member is a privately-insured member or a federally-insured member, if he/she were pressed by a member? There are roughly 9,000 credit unions nationally, so that would be an unrealistic expectation. At the end of the day, the shared branched member wants to know if his/her account was credited or debited properly for his/her transaction. If this regulation were enforced unilaterally, it could potentially cause our credit union to not be able to participate in the shared branching network. This would be a tremendous loss for the many AurGroup members who use other facilities, as well as other credit union members, who use our facilities. If I were CEO of a federally-insured credit union, I would wonder what logic applies to confusing my current members with non-federally insured signage. Thank you for considering a dissenting opinion, when it comes to FDICIA signage. I would propose that FDICIA compliance at privately-insured credit unions already provides adequate disclosure, as we have posted non-federally insured signage at every teller window, where all shared branching transactions would occur. Respectfully Submitted, Tim Boellner, CPA CEO/Pres