Rationales, FYI on FAQs, and The Power of T-Shirts

During NAFCU's Strategic Growth Conference in Ft. Lauderdale, Fla., security consultant Don Thompson was sharing some of the rationales used by those who embezzle and steal from their credit union. A common remark, he said, is thieves will tell themselves and others that they are "overworked and underpaid."

That led Thompson to ask his audience, "Is anyone in this room not overworked and underpaid?," which resulted in some laughs and applause from around the room, although I'm pretty sure the implication was not that these folks are all currently embezzling.

Thompson said that when employees who have been stealing are confronted with evidence of their theft, their reactions can be anything from relief to admission of guilt to continued evasion. He noted one marketing exec found to be robustly rounding up his expense account remarked after being confronted, "We're marketing people. We're not bean counters. We see the big picture and don't keep receipts."

One credit union exec in the audience, by the way, added that when his credit union discovered a dishonest employee who eventually confirmed he had been stealing, it issued the (now former) worker a 1099, forcing them-in addition to other penalties-to pay their own FICA and any other back taxes to the IRS.

¡ It's no secret that if you're looking for information on credit unions, there aren't many drier wells to stare into than credit unions themselves. Most websites, for instance, will pitch generic-sounding "products and services" under the very generic "products and services" tab, even though no consumer has ever said, "I need to get some additional financial products and services." And what about when it comes to a description of the credit union itself, clarifying misconceptions, or answering why anyone should do business with it? Good luck.

So it's worth taking time to visit the FAQ's on the website of Minnco Credit Union in Minnesota. The site includes such out-of-the-box text as:

• "Uhh...what's a field of membership? A field of membership (FOM) defines a group or groups of people who are eligible to join." It then goes on to describe its own FOM as well as others."

• "What does it mean to be a 'member?' First of all, credit union terms can be confusing. Even the term 'credit union' misleads people. We are not a 'union' in the typical sense, nor are we affiliated with any unions. There are no dues to pay, other than your initial deposit into your savings account. The term 'union,' in our case, simply means a united group of people. Everyone who has an account with Minnco is a 'member.' Each 'member' is an 'owner' of the credit union. Each member has one vote, regardless of how much money they might have on deposit. So, when you 'join' the credit union, you become a member/owner of Minnco."

Other FAQs on the list include "How can Minnco pay more on savings while charging less for loans?" (it explains that it has eliminated the "middle man"); "Let me see if I got this right. You offer the same products and services that a bank does, but you'll save me money?," and "Are you like a cut-rate, no-frills, warehouse for financial services?"

You can read them yourself at www.minnco.com.

¡ From the What Goes Around File. In the 1980s financial institutions deployed "helpers" and "concierges" to walk reluctant consumers through how to use this new-fangled thing called the ATM. At the time, one of the carved-in-granite rules of the industry was the "33% ATM Wall," that is that no more than one-third of a customer or member base will ever use the machines.

Use your DVR and fast forward two decades and a credit union was recently explaining to Credit Union Journal how it had deployed member service kiosks, but not every member took to them like the free coffee. So the credit union has deployed "Technology Liaisons" to walk members through the process.

¡ And speaking of going back to the beginning... During that NAFCU Growth Conference, speaker Kevin O'Donnell of Discover Financial Services made some interesting points, including this wry observation: "When you don't promote your offers, something terrible happens: nothing!"

O'Donnell noted that a mistake some CUs make in credit cards is measuring acquisition, but not activation. Research has shown that up to one-third of consumers who receive a card never activate it, and when asked why, respond, "No reason."

"You have to give them a reason," said O'Donnell. "It's the same with why do I want to sign up as a Facebook Fan? What's in it for me? Give them some reward or solve some problem, etc."

The key metric when putting out a new credit card account is the steps taken over subsequent weeks to get that card activated, including follow-up through multiple channels. Incentives work, he stressed, but only if rewarding the right behavior-not getting the card, but activating it, such as a $5 gift card when the card is used.

"Financial institutions give away a t-shirt; people wear the shirt, they never activate the card. They wanted the t-shirt, they had to take the card," said O'Donnell.

Frank J. Diekmann can be reached at fdiekmann@cujournal.com.