SAN JOSE, Calif.-A member of $1.6-billion Technology Credit Union who is fighting Tech CU's proposed charter conversion to a bank has submitted a letter for the credit union to distribute electronically to his fellow members.

In addition, a website and Facebook page have also been established in opposition to the conversion bid.

When or if the letter would be distributed was unclear at presstime. Robert Marinace, a member of Technology CU since 1978, told Credit Union Journal he had been told the letter had been received and would be sent to members. However, a spokesperson for the credit union said simply, "We have received Mr. Marinace's document and are currently reviewing it."

With 72,686 members eligible to vote on the charter change, Marinace had estimated it would cost him more than $100,000 in printing and mailing costs to convey his comments to all members ("Technology Credit Union Hoping to Trade Prizes for Conversion Votes," CU Journal July 2). However, he said he recently discovered an NCUA regulation that allows him to request his letter be electronically mailed to Tech CU members for no more than $200. Marinace said the credit union's records show it has e-mail addresses for 57,620 of its members.

Marinace is also asking that his views be posted on the Tech CU website "in the same fashion and duration" that the pro-conversion materials have been displayed on the same site.

Seven-Page Letter

In Marinace's seven-page letter, a copy of which was obtained by Credit Union Journal, he makes numerous arguments opposing the proposed conversion. He cites information from the National Center for Member Trust to support his assertions that a conversion will lead to higher fees, lower savings rates and higher loan rates, and a loss of member ownership and full voting rights.

Marinace alleges a "potential leadership conflict of interest" based on the possibility of a future conversion of the proposed mutual savings bank to a stock institution. He states "nearly 80% of all credit union conversions wind up becoming stock bank institutions," leading to what he says is a potential boon for those in charge.

"The directors and executives telling you to vote yes also could profit personally through this conversion," Marinace writes.

Marinace goes on to respond to the reasons for the conversion listed by Tech CU in the materials it sent to members asking them to approve the charter change. In the point-by-point he states:

• Tech CU says it needs to be a bank to make more business loans, but it is not close to the regulatory cap.

• Tech Credit Union says it would operate better without field of membership restrictions, but it has penetrated less than 7.3% of its potential members in its six-county field of membership. "Why does Tech CU need to expand beyond its field of membership when there are so many potential members to serve?" he asks.

• Tech Credit Union says it needs to be a bank because the general public is confused about what credit unions are, but "Given the number of bank failures of late, the general unpopularity of banks in the current environment, and the high customer satisfaction ratings that credit unions regularly earn from their members, it is highly dubious to argue that 'confusion' about credit unions provides any justification to convert to a bank."

In an interview with Credit Union Journal, Marinace vowed to keep fighting against the conversion. He called the proposed conversion a "legalized hi- jacking of the equity in Tech Credit Union at the expense of the members."

Marinace went on to call the potential payoff for management and the board from future stock options "Technology Credit Union's mother lode."

After initially working alone in his endeavor to halt the conversion, Marinace has picked up a partner, Carlos Rodriguez. Marinace said Rodriguez has set up a website and a Facebook page, while Marinace has created an e-mail address: for people to contact him.

"Carlos got wind of me as I was calling around and we agreed to work together," Marinace said. "He is managing the websites and I monitor the e-mail address.

"We will go from here and we will see how the response goes," Marinace added.

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