Posts Tagged 'FDIC'

ScamWatch: Beware fraud calls from FDIC

The Federal Deposit Insurance Corporation, the insurance body for banks (like the NCUA for credit unions) warns that some people are getting suspicious calls from the organization:

To date, the callers have alleged that the call recipient is delinquent in payment of a loan that was applied for over the Internet or made through a payday lender. The loan may or may not actually exist. The caller attempts to authenticate the claim by providing sensitive personal information, such as name, Social Security number, and date of birth, supposedly taken from the loan application. The recipient is then strongly urged to make a payment over the phone to “avoid a lawsuit and possible arrest.” In some instances, the caller is said to sound aggressive and threatening.

These calls are fakes from scam artists trying to get your personal information.

The FDIC deals with insuring savings accounts, not on collections matters. No matter how threatening the phone calls, don’t give information from people who call and ask for it. Be sure to keep an eye on your accounts for suspicious activity, and contact the credit reporting agencies to put a fraud alert on your account if you feel threatened.

NCUA increases Federal Insurance Protection for your account



Good news – credit unions were included in Economic Stabilization Act (H.R. 1424), which increases the insurance coverage for your deposited funds, from $100,000 to $250,000, until December 2009.

This means all the money you have at American 1 is covered up to $250,000 should something happen. With the recent bank failures, the idea is to put everyone’s fears at rest.

As the National Credit Union Administration (NCUA) puts it, members of federally-insured credit unions have never lost a penny of their money.

The new $250k cap is true for FDIC-insured banks, too.

If you have any questions about this stuff, be sure to ask someone at our branch offices.


Best way to bank? Don’t take our word for it.



We like to point out that, even in times of financial stress, credit unions like American 1 are a steady way to do your banking. Financially, we’re in great shape, and we continue to do all the great things we’ve always done – like this weekend’s Women’s Expo.

But don’t take our word for it.

Productivity blog Lifehacker helps sing the praises of credit unions, offering us not-for-profit financial institutions as a barrier to the weirdness out there.

“With major instability in banking and unprecedented failures and buy-outs, it may feel like the only safe place to put your money is under your pillow,” Lifehacker editor Gina Trapani writes. “While even through buy-outs like Washington Mutual’s, your money remains FDIC-insured, this is a good time to consider an alternative to for-profit private banks—like credit unions.”

Thanks Gina! And be sure to check out the comments section of the Lifehacker article for great comments from credit union members.


Financial crisis reading material

Last night the Senate approved the “bailout plan,” and it waits for a vote from the House tomorrow (Friday).

In the meantime, here are some articles on the hoopla surrounding the financial crisis. An informed investor is a smarter investor – and even if you don’t do much investing, this stuff is good to know.

  1. As Credit Crisis Spiraled, Alarm Led to Action: from the New York Times, a great timeline of everything that led up to the current situation.
  2. Washington Post Q&A: Readers ask questions about the situation.
  3. Topical Depression: Bernanke Knows What We Have to Fear: Richard Cohen explores how this crisis compares with the Great Depression.
  4. The Only Thing We Have to Fear Is Fear Itself: from Trent over at The Simple Dollar, telling us all to relax.

How ‘big’ is the $700 billion bailout?



Got this e-mail from a co-worker this morning:

A fact, because it’s not a fun fact, I’ll just call it a fact. This morning on the radio I heard that the $700B bale out put in physical terms, would equal approximately 5.5 Empire State Buildings tall of $100 bill bricks ($100,000 in a brick of 2.5” tall bills).

What’s sad is that all those dollar bill bricks are held together by citizens’ repossessed homes, lost businesses, and bankruptcies.

While Washington tries to figure out what the heck to do, we’ll risk repeating ourselves: we’re doing fine.

During his address last night, President Bush said that small-town banks risk failure, but we’re not in any danger. We had an incredible year last year (8,000 new members in fact), and this year we’re growing almost as much. Our July loan rebate will give back thousands of dollars to our members, and our car sale last weekend kept $1 million in the community.

Credit unions are a safe, smooth-sailing way to do your banking. We weather these turbulent times thanks to the strength of our members and our service-minded philosophy. Plus, we’re backed by the full faith and credit of the United States government thanks to the National Credit Union Administration (NCUA), which insures deposits up to $100,000. Think of the NCUA, much like the FDIC for banks, as a strong umbrella in the storm.

American 1 takes our members’ money seriously. We don‘t gamble with sub-prime mortgages, we invest responsibly, and we give back to our community thanks to the support of you and your friends and family.

So for now, we’ll ride this thing out and see what happens at the other end. But this is no time to panic, no matter how many dollar bill bricks it takes to fix the mess.


How are credit unions doing? Hunky dory, thanks.

Someone wrote into the Washington Post:

Q. What is the impact of the government’s financial rescue plan on credit unions?


A. The impact on credit unions seems quite minimal. These nonprofit cooperatives do not hold many of the investments that are poisoning other financial institutions, so they have weathered the crisis fairly well. Credit unions have kept about 70 percent of their mortgage loans on the books, meaning that they did not sell them off to other institutions, according to the Credit Union National Association. The group said that less than 1 percent of credit union mortgages were in delinquency at the end of the first quarter. Delinquencies on other loans have edged up to 1 percent. “If they’ve got their money in a federally insured credit union, they’re just hunky dory,” CUNA spokesman Patrick Keefe said.

Hear that? Hunky dory!


WaMu sinks, customers still swim: so would you

Over at the Ask Metafilter, someone wondered if they should pull their money out of Washington Mutual Bank (often called “WaMu”) – you know, to be on the safe side.

The overwhelming answer? No.

Just like we mentioned a few weeks ago, when you put your money into a federally-insured financial institution, your deposits are covered up to $100,000. It’s the same for WaMu (they’re covered by FDIC insurance) as it is for American 1 (we’re covered by the NCUA).

Lots of weird stuff happening with Merrill Lynch and AIG, but fear not for American 1: we’re doing really well, and we don’t plan on going anywhere.


UPDATE: yesterday Rep. Maxine Waters, D-Calif., told NAFCU’s Congressional Caucus that credit unions are “the only sector of the financial industry that is not in dire straits right now,” thanks to CUs steering clear of sub-prime mortgages. “I know you’ll be part of the solution,” she told the credit union officials.

Your money is safe with us.

Your money is safe at American 1

Lots of news, and worries, surrounding California’s IndyMac Bank’s meltdown.

The Detroit News ran an article addressing concerns here in Michigan, and pointed out that because Michigan is so conservative in its banking outlook, things aren’t as bad as people think.

That’s especially true here, where we’ve been lucky enough to witness growth and success.

As the Detroit News points out, even if credit unions do face trouble, members will be safe:

Even if banking institutions face financial stress, customers’ savings are not in jeopardy.

“People who have deposits under $100,000 need not worry, the FDIC has always paid out their deposits,” said Donald Mann, a private banking consultant and former state banking regulator. The FDIC insures bank deposits.

Credit union deposits are insured by the National Credit Union Administration (NCUA), which is just like the FDIC. You might notice all the NCUA stickers and signs covering our branches; that’s to ensure you that your deposits are safe no matter what happens.

After the IndyMac collapse, people were thinking about withdrawing all their money from their bank or credit union and stuffing it in their mattress. This kind of hysteria is why banks and credit unions fall apart. There’s no need to withdraw all your money and bury it in the back yard: American 1 is doing just fine.

We don’t do mortgages, for one thing. That means we’ve avoided all the pitfalls of “sub prime” and “adjustable rate” mortgages that are grabbing so many headlines lately. By staying out of the mortgage business, we’re less likely to be affected by drastic swings in the marketplace.

So relax. Your money is safe, your loans are safe, and we’re not going anywhere.



American 1 Federal Credit Union