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I have never been pissed off about free money before - Drinking from the Fire Hose — LiveJournal
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Mrs_Sweetpeach
Date: 2007-01-10 10:53
Subject: I have never been pissed off about free money before
Security: Public
Mood:angryangry
Tags:credit union politics
We forgot to bring in the mail last night, so I got it out of the mailbox and brought it to work with me this morning. One of the things in there was a letter regarding DFCU Financial's 2007 Election of Directors. It's no surprise the credit union wants members to re-elect the incumbent directors, but as these are the people who wanted the credit union to convert to a bank, I don't trust their judgment.

This lead to a trip to DFCU Owners United's home page and the discovery that the credit union will issue each of its 160,000 members at least $50 in January. To quote from the article, "These are excess funds, which belong to the members and are being returned to them," said Bruce Gearns, a member of the credit union for 28 years. We're due this money, but there's some interesting questions about timing and what would have happened to this money if the credit union had become a bank."

My sense is that if the conversion had taken place, the $17.5 million going toward dividends would have disappeared. I won't refuse the money, of course, but I'm annoyed that the surplus exists in the first place. Most credit unions don't offer a dividend. Most choose to deliver financial benefits on a daily basis by offering higher interest rates on savings, lower interest rates on loans or fewer and lower fees.
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mbumby
User: mbumby
Date: 2007-01-10 17:25 (UTC)
Subject: (no subject)
Eh, I'm not sure I think of Credit Unions as anything other than a different (and less friendly) flavor of bank anyhow. Back when I was exploring a loan to buy the trailer I lived in for 5 years or so, I asked my bank and my Credit Union what they could do for me. The bank had a high interest rate, but they would work with me. (I ended up going through a different bank, based on the closing agent's recommendation, because I was naive and didn't know any better.) The credit union would lend no more than $SmallAmount, and only if the trailer were younger than AFewYearsOld. The trailer I was buying was 2-3 times older than they would work with me on, and cost 3-4 times as much as they'd lend. So the CU was useless except as a place different-from-a-bank for me to put my money. (The same CU had previously refused my begging to raise the allowable balance on my credit card from $500 to $700.)

I'm cynical enough, though, to agree with you that had the conversion gone through, you'd never have learned about surplus.
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drsulak
User: drsulak
Date: 2007-01-10 18:12 (UTC)
Subject: (no subject)
Thanks for the link. My first response was hush money. I've been a member for about 20 years, and never remembered a special dividend. As a credit union, you would never let money build for six years before distributing it. Sounds like a secret slush fund. I really hope they weren't planning to use that money as their bonus if the bank conversion was successful.

I'll let my sibs know about the link.
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Mrs_Sweetpeach
User: mrs_sweetpeach
Date: 2007-01-16 02:16 (UTC)
Subject: (no subject)
Thanks for passing the word. I'd love to see the current board ousted. Their actions certainly don't match their words.
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lady Infidel
User: ladyinfidel
Date: 2007-01-11 02:22 (UTC)
Subject: (no subject)
yeah, i was not certain on the whole thing, myself.
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