How AML Regulations Are Pulling Credit Unions Into Law Enforcement

Communication and engagement with members is an essential part of any credit unions’ (CUs’) retention strategy. Recently, though, many CUs have turned to technology-driven solutions to help members more efficiently communicate their needs and feedback.

5,653: Number of CUs operating in September 2018However, their members are not the only ones with whom credit unions must regularly work. CUs are also actively communicating with law enforcement agencies, keeping regulators informed about suspicious activity, while receiving tips on noticeable trends that these same agencies are eyeing. Add it all up, and that can be a lot to handle.

In the latest “Credit Union Tracker™,” PYMNTS highlights how CUs are embracing new engagement tech to strengthen relationships with their members, while also boosting anti-money laundering (AML) efforts.

Around The Credit Union World

Many members first engage with their CU through its website or other online portal. In recent weeks, some CUs have stepped up efforts to make their online offerings more accessible to disabled users.

10.8%: Reported CU capital-to-asset ratio increase in September 2018In Rapid City, South Dakota, for example, MED5 Federal Credit Union (MED5 FCU) launched an upgraded website after collaborating with the FinTech OMNICOMMANDER, which works to provide CUs with a variety of online tools, including web design, social media and marketing services. The new site aims to improve online functionality with an enhanced user experience, as well as keep MED5 FCU in compliance with the Americans with Disabilities Act.

Meanwhile, another partnership could change the way users engage with a CU’s network of ATMs. Actors Federal Credit Union (ActorsFCU) is working with ATM solutions provider Paramount Management Group to deploy the latter’s digital media solutions in 250 ATMs across New York City. The solutions will include a built-in, software-connected camera, designed to capture an array of customer profile data – including age, gender, time, date and weather and display the appropriate advertising based on the collected insights.

A New England-based CU is also turning to tech in hopes of better engaging with its members. Northeast Credit Union (NECU) recently upgraded its HappyOrNot member satisfaction terminals at 20 branch locations. The new terminals are intended to allow members to provide feedback to NECU officials, as well as share their wait times, the level of employee professionalism and any loan rates, among other data, in near real time.

8%: Projected 2019 growth in CU loansAML Compliance Turns CUs Into Law Enforcement

CUs must regularly engage with more than their members. As these financial institutions (FIs) work to boost AML efforts, as required under the Bank Secrecy Act (BSA), they must step into the role of law enforcement agencies.

Under AML/BSA regulations, CUs must investigate transactions that are flagged as suspicious, requirements that Colleen Kelly, senior federal compliance counsel of the Credit Union National Association (CUNA), claimed can often spread CU resources thin. In this month’s feature story, Kelly discussed AML/BSA requirements and the “two-way street” in which CUs and law enforcement collaborate to fight financial crimes.

About The Credit Union Tracker

The “Credit Union Tracker™,” powered by CO-OP Financial Services, is the go-to resource for staying up to date on a month-by-month basis on the trends and changes in the credit union industry.