Wednesday, October 23, 2024

Review And Reflection - Part 8 : A Crisis Of Confidence - The Smoking Gun # 2

  ... nice doggie!

From: Maurice Smith
Sent: Thursday, May 12, 2022 7:07 AM  

To: HAYES, JIM [link to full text here]

 
"I have been giving additional thoughts to our conversation about the potential combination of SECU and LGFCU."...  "We have had exhaustive dialog with and among our Board about the prospects.... To be frank, there is hesitation among our Board about a merger."

😎 For those of you who aren't familiar with former LGFCU CEO Maurice Smith, he is a world-class diplomat ... "there is hesitation among"... is about as nice a way of saying "hell no!" as I can think of, agree?

"I’ve heard you imply that LGFCU is a bigger weight to SECU than you would have expected. This is the first time I’ve heard this from SECU management."[in 40 years!]

😎 Mr. Smith is also a savvy, practical business leader. When confronted with the "pressure" of being designated as a "bigger weight" problem by his "40-year trusted partner SECU", Smith appears to be applying the "nice doggie deferral strategy". What's the "nice doggie deferral strategy"? Well, if you're ever confronted with a severe, volatile business problem - much like being confronted by a snarling, vicious German shepherd - just keep your cool, keep smiling and saying "nice doggie, nice doggie",  until you can get hold of a big rock! (Don't laugh, its sound business advice!) Smith applies it well in defense here.

😎 The SECU CEO has "manufactured a problem" with the "core" technology conversion vendors' concerns. First, the SECU CEO's job is not to represent a vendor, unless there is some unknown ulterior motive. Second, SECU had negotiated dozens of IT contracts which included joint processing for SECU, and partners LGFCU, Latino, Greater Kinston, and NC Press Association credit unions over several decades. Never was any problem to reach a vendor agreement. Check the record!

😎 But here, take another listen to the SECU CEO's explanation of all this in the extended SECU Board-approved Fireside Chat video [link... see @ 25:00]. It's sorta difficult to reconcile the CEO's offhand , aw shucks presentation that he and the SECU Chairman got together and had a "great dinner" with LGFCU leaders who said "no" to the merger. This "great dinner" was 6 months after the SECU CEO first proposed a merger to LGFCU and occurred even after Mr. Smith had diplomatically told SECU "hell no" on May 12, 2022 as you see above. What was LGFCU saying "no" to [according to the SECU CEO in this video] if there wasn't a proposal?

😎 BTW did you know that LGFCU contributed @ $50 million annually for its participation in that trusted-partner, cooperative operations effort with SECU? LGFCU always paid its share of the costs for tech changes and all other operational costs incurred by SECU.  In the video, according to the SECU Chair, the loss of that $50 million will not affect SECU's business operations. A loss of $50 million in annual revenue won't hurt??? ... wanna bet?

➜ "We prefer to work collaboratively with you to achieve both our goals.  Our near four‐decade history of collaboration is no accident. Our credit unions forged a relationship built on mutual trust and partnership. I see no reason this can’t continue in a newly re-imagined future. "

😎 At May 12, 2022 it doesn't really appear that LGFCU is preparing to execute that "long-planned" exit to independence espoused in the November video by Mr. Naylor, [link... see @ 25:35], does it? Least not according to LGFCU's former CEO of 25 years!  Somebody is telling "a story" here. (As Mr. Naylor says "I'm trying to stay away from using the word lie".) 

✅ Why did the SECU Board choose to "tell this story" to 2.8 million SECU members?

 

  Lack of transparency by any group - motives, competence, poor judgment? - is "a red flag" that erodes confidence and destroys trust.



 

30 comments:

  1. We do have a big problem here. Many members want to think it was Jim Hayes. The board hired him, an outsider with a terrible reputation in the national credit union universe(WestCorp's financial collapse Look it up.) to run SECU. Chris Ayers, SECU Board Chair backing up everything Jim Hayes says. Jim Hayes was the board's puppet, the board was/is still the puppet master.

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    Replies
    1. puppets are usually made of wood and have blockheads.

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  2. Only a fool would partner with a rogue german shepherd SECU board. local gov's rock was to pack its bags. Can't blame them.

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  3. Can we have a do over on that last election?

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  4. We get to vote out Chris Ayers in 2025... get rid of the other half!

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    Replies
    1. If this is the only thing we do, we must. He is the same Chris "Coal Ash" Ayers from Duke energy who specializes in ruining the lives of North Carolinians to only enrich himself. He should be in prison.

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  5. What could be done for different outcome

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    Replies
    1. Telling the truth couldn't have hurt. Usually helps.

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  6. So we stand to lose another $50 million? when will it end?

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  7. So has LGFCU opened up their membership, might want to switch from SECU

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    1. LGFCU no longer exists. It has been merged into CIVIC FCU. CIVIC is an open, anybody can join NC based credit union.
      CIVIC will cause significant problems for SECU shortly.... stay tuned to witness one of the major downsides of weak - or informed - leadership by the SECU Board.

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    2. 8:17pm should read "...uninformed or misinformed - leadership by the SECU Board.

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  8. SECU is not making 50 million in net profit on this relationship. If the revenue goes away, the expense will go away or be reallocated. Hayes said 15% of the staff /time supports LGFCU. $50 million equates to about 6% of SECU’s annual employee comp budget.

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    1. The 11:21am commenter didn't say SECU would lose $50 million in "net" income, but the 7:18pm commenter is right in saying that $50 million is not "net profit". In fact SECU leadership said that "15% of SECU's time" was servicing LGFCU members.

      SECU leadership has not been well-noted over the last 3 years for being able to justify its "figures" and analyses; and when challenged or questioned, can't or won't provide more detailed information.

      But one "back of the napkin" estimate might be that SECU has @ 2.6 million members and LGFCU has @ 450,000 members. So if SECU is jointly serving @ 3 million members, then yes the 450,000 LGFCU members are @ 15% of those served and the costs incurred.

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  9. Have honor and good faith. Give your readers the full explanation and both sides of the LGFCU relationship going away.

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    Replies
    1. In the posts thought Mr. Smith gave a balanced, documented account of what occurred in the LGFCU/SECU debacle; but you also have the SECU Board-approved CEO/Board Chair Fireside Chat video version. Your choice!

      I wasn't there, they were. My opinion doesn't matter, but the truth does.

      Again, your choice! Own it!

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  10. Civic will learn quite quickly life is good after SECU,

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    1. I'm not so sure this statement is accurate. Civic may feel a reputational fallout in the coming months due to the LGFCU debacle. Most LGFCU members are upset and leaving in mass. They want nothing to do with Civic.

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  11. Blaine's assertion that Civic is an open/anyone can join CU is blatantly false and misleading. From Civics own website these are the membership requirements. They're basically the same as LGFCU.
    https://www.civicfcu.org/why-civic

    - Current and retired employees of local government agencies (contract, part-time, seasonal and full-time employees are included)
    - Businesses owned by local government workers, or who primarily service local government agencies
    - Local government elected officials
    - Volunteers for local government units

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  12. The last few posts have asked the question: "What's the problem with telling the truth to SECU members?" (...and LGFCU members for that matter!)

    Note in the comment on membership eligibility: "They're basically the same as LGFCU". Here's that eligibility list:

    If you are an employee or volunteer with any of the following, you qualify for LGFCU membership:

    * ABC Boards and store employees
    * Authorities (airport, housing, transit, water and sewer)
    * Commissions (planning, economic development)
    * Councils of Government
    * Departments (health, human, and social services)
    * Districts (sanitation, soil, water conservation)
    * Emergency management services, including fire and rescue, law enforcement and volunteer fire departments
    * Hospitals that are currently or were previously owned or operated by a NC local government (see list)
    * Libraries
    * Local government associations
    * Local government boards
    * North Carolina county governments
    * North Carolina municipalities including cities, towns and villages
    * Parks and recreation departments

    * * *Additional ways you can become a member:

    We also extend membership to people who are associated with local government employees and volunteers. You are eligible for membership if you are a(n):

    * Volunteers of any of the above Employers
    * Elected or appointed government official
    * Contract employee in a local government unit
    * Associations related to local governments
    * Associations compiled of credit union members or employees above
    * Foster parent
    * Immediate family member of an LGFCU member, including spouse, children, grandchildren, mother, father, sister, brother, grandparents, stepchildren, stepparents, and step siblings
    * Person living in the same residence and maintaining a single household unit with an LGFCU member
    * Retiree from North Carolina local government
    * Spouse of a deceased person who was eligible for membership

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    1. As I said 11:50 limited not open, misleading

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    2. For the @10:32 & 11:50 commenters: Was trying to stay out of this because its LGFCU's business, but since you persist. LGFCU/CIVIC does not have any real limit on membership - anyone can join, and their leadership knows it. WHY DON'T YOU SIMPLY ASK HIM? He'll set you straight!

      First example: Look at the list under 12:15pm above. At the 8th line *"Hospitals" note the "(see list)". When you go to that list [https://www.lgfcu.org/hospitals-healthcare] you'll be shown a list of 70 hospitals that LGFCU/CIVIC serves - nothing wrong with that, again that's their business.

      But the website claims these are all hospitals "currently owned/operated by a NC local government". Is that true about Duke University Hospital, UNC Health, and ECU Medical Center? That was a surprise to me.

      If LGFCU/CIVIC wants to serve everyone, again that's their business. But claiming that membership is limited to just the list the 11:50am commenter shows - shall we say, "challenges the truth". (As someone said: "Trying not to use the word lie.")

      Why not just say LGFCU/CIVIC would like to serve everyone in the USA who needs us? What's wrong with that?

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    3. LGFCU/CIVIC - The "Anyone Can Join" discussion:

      Example 2: is that phrase "* Volunteers of any of the above Employers" ... may join LGFCU/CIVIC.

      Can't find where "volunteer" is defined anywhere on the website or in the bylaws, or if you need some kind of note from the city/county manager as proof?. Volunteering to help your city/county government sounds like a good purpose, can't imagine anyone arguing against that. And it's real easy to sign on to volunteer your help.

      Anyone can do it!

      Fact is, I personally volunteer twice a month in Granville County, have for years.

      Why not just say LGFCU/CIVIC would like to serve everyone in the USA who needs us? What's wrong with that?



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    4. LGFCU/CIVIC: "The Anyone Can Join" discussion

      Example 3 - Then there's:

      * "Immediate family member of an LGFCU member, including spouse, children, grandchildren, mother, father, sister, brother, grandparents, stepchildren, stepparents, and step siblings"

      So if I'm a LGFCU/CIVIC member and local government hospital worker at Atrium in Charlotte, my grandparents, parents, children and grandchildren can also become members. That sounds positive!

      And, once they are members, their future partners, future children, and future grandchildren can also join... that's getting to be a lot of eligible members!

      Since folks always accuse North Carolinians of "marrying your cousins", that "family membership eligibility" may be enough to prove everyone in the State is eligible to join LGFCU/CIVIC!

      Why not just say LGFCU/CIVIC would like to serve everyone in the USA who needs us? What's wrong with that?

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    5. LGFCU/CIVIC: The "Anyone Can Join" discussion

      Example 4: While we're talking about Atrium Health in Charlotte, did you realize what a huge organization that is?

      "Headquartered in Charlotte, North Carolina, we have a combined footprint across six states – Alabama, Georgia, Illinois, North Carolina, South Carolina and Wisconsin – and maintain a strong organizational presence in Chicago and Milwaukee."

      * nearly 155K employees
      * more than 21K doctors
      * nearly 42K nurses
      * 69 hospitals
      * more than1K sites of care

      One would assume that LGFCU/CIVIC intends to serve all the 155,000 eligible members who work at Atrium in all six states ... and their families... and any volunteers.

      To give you an idea, there are a total of @135,000 county and city employees in North Carolina. Already fewer employees in all of NC local government than at Atrium, which has ambitions to grow faster.

      See any potential future conflict here?

      Why not just say LGFCU/CIVIC would like to serve everyone in the USA who needs us? What's wrong with that?





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    6. Not sure if it is still the case, but you could join civic by “volunteering” by filling out a five question survey. That’s about as close to open membership as you can get.

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    7. NC teachers are county employees not state employees. looks like they and their families are eligible for civic too

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    8. Here's how NC credit unions are skirting the law https://memcu.com/affiliate-association. Coastal and others are with the Consumer Council. the trade association is fronting their foundation where LG is operating. All BS for credit unions. you all are corporate scammers

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  13. LG and SECU serve two different bases LG has always been its own institution and is treated as such by regulators. SECU is basically LGs branch, call center and database.

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  14. I joined Coastal with my AAA card

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