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Do’s and Don’ts of Being a CU TellerDate: Tuesday March 16, 2010Time: 3:30PM-4:45PM Eastern Standard Time

Understanding Self-Employed TaxesFOR MAKING CREDIT DECISIONSDate: Tuesday April 13, 2010 Time: 3:30PM-4:45PM Eastern Standard Time

Today’s FacilitatorToday’s Facilitator

Supervisory CommitteeSupervisory CommitteeDuties & ResponsibilitiesDuties & Responsibilities

Presented by ICUT Services

Will begin in a few minutes………….

Housecleaning ItemsHousecleaning Items

Detailed OutlineHold Verbal QuestionsUse the Chat FeaturePolling PowerPointComplete Class SurveySend Me an eMail???Door Prize Winner

Today’s AgendaToday’s Agenda

Define Supervisory Committee Qualifications & Power Of Committee Duties & Responsibilities Internal Review Program Best Practices for CUs Internet Scams, Fraud, Identity Theft How To Manage The Committee Open Mic

What Is What Is The Supervisory The Supervisory Committee?Committee?

The Guard Dog or “Watchful Eye”The Audit Committee

“The committee that helps minimize the possibility of the credit union incurring

any kind of loss.”

How Does One Get How Does One Get On This Committee?On This Committee?

Appointed by the Board Of Directors

- 1 may serve as director- 1,2,or 3 year terms

Who Can Serve?Who Can Serve?

Qualifications Member In Good Standing (Shares & Loans) Accounting Non Accounting Backgrounds Active & Cooperative Participant Commitment To CU

Structure Of CommitteeStructure Of Committee

Committee Size (3-5)Positions On CommitteeBoard Representation

What Power Does What Power Does Committee Have?Committee Have?

Access To All RecordsCan Call Special Membership Meetings

Removal Of Officers, Directors & CC Members

Duties & ResponsibilitiesDuties & Responsibilities

Planning & BudgetingMeet RegularlyAttend Board Meetings (?)

Understand Financial TrendsUnderstand The CU’s RisksSurprise Cash Counts


Planning & BudgetingMeet RegularlyAttend Board Meetings (?)Understand Financial TrendsUnderstand The CU’s RisksSurprise Cash Counts

Understanding Financial TrendsUnderstanding Financial Trends

Beginners: NAFCUNET.org / CUES.org / cuSchool.com

Intermediate: NCUA.gov (5300) / CUNA.org (Research & Statistics)

Advanced: ALM Reports, FPRs (NCUA.gov), Journal of Accountancy (COSO)

Understanding CU RisksUnderstanding CU Risks

Credit Risk Liquidity Risk Interest Rate Risk Compliance Risk Strategic Risk Transactional Risk Reputation Risk

Surprise Cash CountsSurprise Cash Counts Cash Count Audit Review As of_____________

Drawer #________

COINS: CHECKS:

Pennies ________ ______________ ________

Nickels ________ ______________ ________

Dimes ________ ______________ ________

Quarters ________ ______________ ________

Halves ________ ______________ ________

Dollars ________ ______________ ________

CURRENCY:

Ones ________ ______________ ________

Twos ________ ______________ ________

Fives ________ ______________ ________

Tens ________ ______________ ________

Twenties ________ ______________ ________

Fifties ________ ______________ ________

Hundreds ________ _____________ ________

Subtotal $ ________ Subtotal $________

Per Control $ ________ Per Control $________

Difference $ ________ Difference $________ I, ________________, owner of this drawer, certify that a member of the supervisory committee has counted all cash and checks in my possession as of ____________________. Signed___________________ Time & Date Name of Teller

Duties & Duties & ResponsibilitiesResponsibilities

Review Loan FilesEvaluate Internal ControlAccount VerificationMonitor BoardReview Bank ReconcilementsWork With Regulators & Follow-upConfirm Account Closures

Confirm Closed AccountsConfirm Closed AccountsDear Member:

As a valued member that planned to closed your account at the credit union we hope that you had a positive experience that you found our services of value.

In an effort to improve our services, we would appreciate it if you would take a few seconds to respond to the survey shown below:How long were you a member? ___________________________

Why did you close your account? __________________________

Would you ever join again? _____________________________

Did you know our policy is “once a member, always a member”?_____

Sincerely,

Supervisory Committee


Plan Annual Audit & Follow-upReview Returned MailConfirm Collection AccountsConfirm Death ClaimsMaintain Visibility

Confirm Collection AccountsConfirm Collection Accounts

Young & Young Law Firm

100 Best Way

Nocandu, Nebraska 08066

Dear Mr. Young:

On behalf of the supervisory committee for the ABC Federal Credit Union, I would like to confirm what credit union accounts have been forwarded to you for collection during the past twelve months. As part of our confirmation we would like to know the following information:

ACCOUNT NAMEDATE RECEIVEDORIGINAL LOAN BALANCECURRENT BALANCESTATUS

Again, we only need this information for accounts that you received between July 1, 20XX and the date of this letter.

Please forward all responses to this request to:

John Doe

c/o ABC FCU

12 Wayward Road

Nebraska City, Nebraska 08065

Confirm Death ClaimsConfirm Death Claims

CUNA Mutual InsuranceP.O. Box 1084Madison, WI 53701ATTN: Death Claims

Dear Claims Department:

On behalf of the supervisory committee for the ABC Federal Credit Union, I would like to confirm what death claims have been presented to you for the credit union during the past twelve months. As part of our confirmation we would like to know the following information:

CU EMPLOYEE SUBMITTING CLAIM

MEMBER ACCOUNT NAME

AMOUNT OF CLAIM

DATE CLAIM WAS SUBMITTED

STATUS

Again, we only need this information for claims that you received between July 1, 20XX and the date of this letter.

Please forward all responses to this request to:

John Doec/o ABC FCU12 Wayward RoadNebraska City, Nebraska 08065

Internal Review ProgramInternal Review Program

The Supervisory Committee is the audit committee for the ABC Federal Credit Union. In that capacity, the committee will engage in regular activities that are intended to monitor the overall operation of the credit union. The structure of this committee will be compliant with the Federal Credit Union Act and the bylaws of the ABC Federal Credit Union. Accordingly, the committee will be responsible for the following:

Internal Review ProgramInternal Review Program

Report all committee activities to the board of directors

Maintain minutes for all committee meetings. Annually review the internal controls Annually follow-up with Supervisory Committee audit findings

Annually follow-up with NCUA examination findings Annually review the credit union’s strategic business plan.

Quarterly perform surprise cash counts. Quarterly perform verification of deposits in transit Quarterly perform a review of teller activity. Quarterly review negative share report. Quarterly review a sample of loan files for compliance.

> Monthly to monitor board activity

Identity Theft Identity Theft (Ijacking)(Ijacking)

It is the use of another person’s identification, credit, or other data that involves fraud or deception, and economic gain is realized in the name of the victim. Unlike fingerprints, that are unique to each individual, personal data, like social security numbers, bank accounts or credit card numbers, telephone calling card numbers and other valuable identifying data can be used.

Identity Theft On The Identity Theft On The RiseRiseRecent reports put the numbers of ID Theft at 9.9 million per year… Insurance Journal January 2010

–5% of the adult population in America

–Cost $50 billion annually.

–1 out of 4 Americans fall victim to ID Theft.

–1000 cases of ID Theft occur each day.

10 Most Risky Cities for 10 Most Risky Cities for IjackingIjacking

1) San Francisco2) Seattle 3) Denver4) San Jose5) San Diego 6) Atlanta 7) Salt Lake City8) Las Vegas9) Sacramento 10) Phoenix

Sperling’s Best Places

10 Least Risky Cities 10 Least Risky Cities for Ijackingfor Ijacking

41) Rochester42) Providence43) Cincinnati 44) Cleveland45) Virginia Beach46) New Orleans 47) Birmingham48) Louisville 49) Buffalo50) Pittsburgh

Sperling’s Best Places

Justices Limit Use of Justices Limit Use of Identity Theft Law Identity Theft Law

The Supreme Court on Monday rejected a favorite tool of prosecutors in immigration cases, ruling unanimously that a federal identity-theft law may not be used against many illegal workers who used false Social Security numbers to get jobs. …..NY Times May 4, 2009

The LawThe Law

•Identity Theft and Assumption Deterrence Act of 1998

•Gramm-Leach-Bliley Act (GLBA) requires that financial institutions have policies, procedures, and controls in place to prevent and detect fraudulent access to such information.

•Red Flag Rule

Best Practices For CUsBest Practices For CUs

•Protect your member information.

•Verify new accounts with a Member Identification Program

•Verify and review address changes. Confirm old addresses or a simple callback to phone numbers on file.

•Carefully review loan documents and compare social security numbers, addresses and employer names on application and the credit report.

•Conduct a “System Penetration Test”.


•Train all staff on security and privacy protection.

•Policies should include steps to help victimized members.

•Conduct criminal and civil background checks before hiring employees.

•Don’t use SS# as employee ID numbers on paychecks, time cards, staff badges, etc.

•Restrict system access to sensitive personal data to only those who need the information.


•Ensure proper disposal of sensitive information.

•Inform your members about business identity theft such as vandalized or mimicked Web sites.

•Educate your members that financial institutions do not contact members to request or verify security information.

•Consider software/hardware that regularly monitors the database to detect unusual financial patterns and activity.


•Have a written privacy policy, adequately communicate the policy and provide training.

•Lock up and limit access to personnel files.

•Provide a secure location for employees to store their purses, documents, briefcases, etc. at the workplace.

•Ensure that your vendors are protecting confidential employee data.

Internet Scams & FraudInternet Scams & Fraud

Phishing/Pharming – Educate your members

Age-targeted Scams – Youths and seniors

Counterfeiting – Currency & DraftsRecords/Systems Hijacking – Zombie Programs

- designed to steal data, damage web sites, slow response time

Useful ResourcesUseful Resourceshttp://www.IdentityTheft.orghttp://www.ncua.govhttp://www.internetfraud.usdoj.gov/ http://www.antiphishing.org/ NCUA Guide for Supervisory CommitteesNCUA Federal Credit Union BylawsNCUA Rules & Regulations

Managing The CommitteeManaging The Committee

Work As Committee & Individually Delegate To Staff Outsource Plan

PlanningPlanning Use The Entire Year Don’t Try To Complete Everything At Once Have A Schedule (less than 30 min per month)

Let’s Look At A Sample Year

Month 1Month 1

- Appoint committee members to positions

- Introduce Training Resources- Schedule Activity for the year

Month 2Month 2

- Cash Count Training- Elect one designee to review Accounting Checklist with management.

Month 3Month 3

- Report on accounting checklist- Elect one to confirm collection accounts

- Elect one to confirm death claims

Month 4Month 4

- Report on collection accounts- Report on death claims- Elect one to coordinate collection of returned mail

- Do surprise cash count(s)

Month 5Month 5

- Report on plans to collect returned mail

- Report on cash count(s)- Meet with audit firm to discuss timing & scope

Month 6Month 6

- Report on audit plans- Attend or coordinate a “HOW TO APPROVE A LOAN” training program.

- Elect one to review minutes

Month 7Month 7

- Report on training status- Report on board minutes (or activity)

- Committee review of returned mail

Month 8Month 8

- Have management or audit firm train committee on bank reconcilements

Month 9Month 9

Committee Review Of Loan Files

Month 10Month 10

- Report On Loan File Review- Perform surprise cash count- Solicit audit bids or engage audit firm

Month 11Month 11

- Report on cash count- Report on audit plans- Attend educational workshop

Month 12Month 12

- Report on training- Review completed audit report and discuss corrective action with management.

Thank YouThank You

- And the door prize winner is…

CU Staff Training Teller Training Lending Training Collection Training IT Training And Much More.

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