Ransomware developers and affiliates have been telling victims they must pay the ransom or stolen data and internal company secrets will be publicly released. Unfortunately, not everyone has been a believer. Six and seven-figure demands have become routine among ransomware attacks with the average ransom payment in quarter two of 2020 reaching $178,254, a 60% leap from the $111,605 average in quarter one according to the Coveware Quarterly Ransomware Report. [1]

“Credit unions need to be looking out for ransomware techniques. These cyber attacks have no boundaries and are truly a global issue,” reports Carlos Molina, Senior Risk Consultant at CUNA Mutual Group. “Ransomware has grown in frequency and severity significantly. The average ransom payments have climbed exponentially in the last few years.”

Ransomware payments in 2019 were three times as large as 2018 payments and four times as many extortion demands  were paid in 2019 versus 2018, according to incidents reported to Beazley. In fact, ransomware claims increased 239% and the total cost of ransomware payments has increased by 228% from 2018 to 2019. [2] 

According to Derek Laczniak, Director of Cyber Liability at M3 Insurance, “Ransomware developers threatened to release stolen data in the past. However, now with the actual release of confidential information, credit unions need to treat these attacks more like data breaches. Business interruption from these events has become a regular occurrence leaving both reputational and financial impacts.”

​How does Ransomware work?
Ransomware is a malicious software that restricts access to an infected machine, usually by systematically encrypting files on the system’s hard drive. Then the cyber-criminal demands payment of a ransom in exchange for the key or keys to decrypt the data. Ransomware can be devastating.
The most identified infection points used to deploy ransomware:

• Phishing emails
• Corrupt attachments
• Weak or poorly secured remote desktop protocols (RDP)
• Unpatched system vulnerabilities and untimely anti-virus updates
• Extensive reuse of passwords
• Lack of multi-factor authentication

Molina points out more criminal effort is being placed towards remaining undetected on a breached network. The time that exists between the first execution of malware and its discovery inside the network is commonly referred to as dwell time. “Increased dwell time provides threat actors with opportunities to escalate hijacked privileges while searching for data caches of sensitive information that can be exploited,” said Molina. The average dwell time is 43 days for ransomware according to an Infocyte report. [3]

There has also been a significant increase in criminals who purchase ransomware kits on the dark web, launch attacks in the hope of getting some payment, and care little about the data restoration experience of their victims.

With NetGiver, credit union members can donate online and through their mobile app to over 1 million 501(c)(3) charities. 100% of the members donations to go the charity with no fees to the charity or the member.

The Minnesota Credit Union Network is an owner of NetGiver, a CUSO that enables fee-free charitable contributions exclusively for credit union members through a mobile giving platform.

“NetGiver helps credit unions to exemplify the ‘people helping people philosophy’ and demonstrates that credit unions are embracing innovation in technology,” said John Ferstl, Chief Operations Officer of the MnCUN Network Service Corporation.

With the demand on charitable services rising during COVID-19, NetGiver is proud to provide a platform that enables 100% of every donation to reach the charity for which it was intended.

Join one of the upcoming webinars to learn how supporting a member’s giving provides a better member experience:

• Wednesday, Feb., 24, 2021, 2:00 PM
• Wednesday, Mar 10, 2021, 2:00 PM​

First Alliance Credit Union surprised member Heather S. of Dodge Center with a $5,000 check and Financial One Credit Union will celebrate their winner this Friday at their Columbia Heights location.

As of December 2020, WINcentive in Minnesota has reached 8,400 accounts open with nearly $10 million in total saved by members of credit unions throughout the state.

WINcentive Savings incentivizes consumers in to save by offering risk-free rewards. WINcentive prizes are awarded on a monthly, quarterly, and annual basis, with prizes ranging from $100 to $5,000.  Account holders in Minnesota qualify for up to four chances per month for each $25 increase in their month over month savings balance.

The Minnesota Credit Union Network and TruLync also administer prize-linked savings programs for credit unions in Delaware, Georgia, Hawaii, Louisiana, Massachusetts, Montana, New York, New Jersey, Ohio and Wisconsin. To date, the programs provide nearly 29,000 members the opportunity to win through prize-linked savings accounts, with over $40 million saved. In total, the programs have awarded over $1 million dollars to members of credit unions throughout the nation.

For details about prize-linked savings, please contact Director of Engagement, Ben Hering, via email. More information about WINcentive Savings, including a list of participating credit unions, can be found at wincentivesavings.org.

​The Minnesota Credit Union Employee Benefits Plan (Plan) will hold its first election for trustees. One of the benefits of association health plans is that they are governed by the participants.

The Plan’s Board of Trustees is composed of 7 members, the majority of which are elected from, and by, the participating credit unions. The current Board, which consists of Mark Cummins, John Ferstl, Brian Sherrick, Dave Boden, Daryl Doucette, Aaron DeJong and Dick Nesvold, was appointed prior to the Plan having participants.

​The Plan grew to 17 employer groups in 2021 and over 400 covered employee lives. We also improved the offering by adding two plan designs and ancillary benefits (life, disability, dental, vision, etc.). The call for candidates will go out to participating credit unions this Friday. 

Christopher Roe, SVP Corporate & Legislative Affairs, CUNA Mutual Group

More than ever, 2020 has shown a spotlight on the incredible impact that credit unions make in their communities.  Whether it’s working around the clock to process Payment Protection Program loans, participating in social justice initiatives or giving their employees time off to vote, credit unions have consistently demonstrated their commitment to serving the needs of their communities.  

But equitably meeting those needs in minority or low-income communities takes commitment and innovation.  That’s where the U.S. Treasury Department’s Community Development Financial Institution (CDFI) Program can help.
Created by Congress in 1994, the CDFI program was designed to combine federal money with private capital to help qualified financial institutions meet the need of under-served communities that typically lack access to affordable loans and safe financial services.

“When we looked at the needs within our community, we knew it was just too large a problem to solve on our own.  That’s why we started looking into the CDFI program,” says Kirk Mills, CEO of St. Louis Community Credit Union.  “As an example, we wanted to offer consumers an affordable alternative to predatory financial products and help get our members off the payday loan merry-go-round.  The benefits and grants from the CDFI program have allowed us to focus more of our lending activities on minority and low-income members who need it most.”
​
Benefits of the CDFI Program 
Mission driven credit unions are dedicated to financial inclusion, and the ability to apply for capital or technical assistance grants is often a top draw for credit unions.  In September 2020, the CDFI fund awarded grants totaling $45.8M to 111 credit unions.  
Additional benefits of the CDFI program include:

• Access to additional training resources
• Exemption from the NCUA’s member business lending cap
• Membership in a learning community of like-minded credit unions to share ideas
• Limited exemptions under the CFPB Qualified Mortgage and Ability-to-Pay rules.

​What a CDFI Credit Union Looks Like
Not every credit union will qualify as a CDFI.  There are seven tests for CDFI certification, most of which are automatic or easily fulfilled by most credit unions.  A good CDFI candidate makes it their primary mission to provide development services like financial education and coaching for those community members who need it most.  That commitment can be seen in the makeup of their governing or advisory boards, providing a reflection of the communities they serve. 
The real hallmark of a CDFI credit union is that their lending activities are predominantly focused on target populations in economically depressed areas, low-income communities, or other historically under-served populations.

The WINcentive Grand Prize and quarterly winners will be announced on Facebook Live, January 15 at 10:00 am. Two $5,000 Grand Prizes and 2 quarterly $1,000 winners will be awarded to Minnesota credit union members.

Join the special announcement on WINcentive's Facebook page: https://www.facebook.com/WINcentiveSavings/live/​ 

After an unconventional year, Verafin is helping over 1200 credit unions prepare for the future of their financial crime management programs with efficient and effective solutions for Fraud Detection and Management, BSA/AML ompliance and Management, High-Risk Customer Management and Information Sharing.
​
Join us on January 14,  at 11:30 a.m. to learn how Verafin can help your institution fight financial crime and prepare for industry challenges in 2021. Register now for this special demonstration — exclusively for credit unions.

For details about prize-linked savings, please contact Director of Engagement, Ben Hering, via email. More information about WINcentive Savings, including a list of participating credit unions, can be found at wincentivesavings.org.

The Minnesota Credit Union Network (MnCUN) is proud to announce that NetGiver has won a Minnesota Technology Association 2020 Tekne Award in the Financial Services category. MnCUN is an owner of NetGiver, a CUSO that enables fee-free charitable contributions exclusively for credit union members through a mobile giving platform.

​“It used to be when you wrote a check to a nonprofit for $100, the nonprofit got the full $100. Today however, with credit and debit cards as our primary way of giving, charities now incur fees they never used to when donations were made with cash and check,” said Eric Berg, DNT BLNK's Founder/CEO, and Co-founder of NetGiver. “It is an honor for DNT BLNK and NetGiver to be recognized with a Tekne Award this year.”

For the past 23 years, the Tekne Awards have highlighted the new and exciting ways technology developed by Minnesota companies is impacting our community and the world. Companies competed for Tekne Awards in 16 primary award categories, ranging from Artificial Intelligence & Machine Learning to Technology for Good. Descriptions of each category are available at: https://tekneawards.org/award/2020-award-categories.

MnCUN joined the ownership of NetGiver as part of the "people helping people philosophy." Credit union members can donate online and through their mobile app to over 1.3MM 501(c)(3) charities. 100% of the members donations to go the charity with no fees to the charity or the member.

“NetGiver helps credit unions to exemplify the ‘people helping people philosophy’ and demonstrates that credit unions are embracing innovation in technology,” said John Ferstl, Chief Operations Officer of the MnCUN Network Service Corporation.

With the demand on charitable services rising during COVID-19, NetGiver is proud to provide a platform that enables 100% of every donation to reach the charity for which it was intended.

Join one of the upcoming webinars to learn how supporting a member’s giving provides a better member experience:

Wednesday, Dec. 16, 2020, 2:00 PM
Wednesday, Dec. 30, 2020, 2:00 PM
Register now

We’ve known for some time that credit union members would prefer accessing financial services at a credit union. While more than half of members report that, only 3% of members utilize their credit unions for investment services. That’s according to research from Kehrer Bielan, sponsored by CUNA Brokerage Services, Inc. (CBSI).
 
Now, during a time of global pandemic and economic uncertainty, it may seem counterintuitive to focus on investments. Members are struggling economically and face nerve-wracking uncertainty. But this is exactly when these services and strong financial planning need to be present and proactive within credit unions.
 
The same research found that 33% of households with at least one credit union member say providing for retirement is their most important financial goal. At a time when many people’s financial planning and retirement goals might be put off, credit unions should be the go-to source to help members through this crisis.
 
There is enormous opportunity for credit unions to do more to empower their members and help them through the uncertainty they face, as well as  to grow their business by making investment services equally important as their savings, loans and insurance products.
 
But making investment services core requires more than just vision—it involves deep thought, a data-driven strategy and four core best practices:

Increase Advisor Headcount. Start by focusing on advisor recruiting. Use a junior/associate advisor model where senior advisors mentor those with less experience. This can fill your pipeline with promising, skilled professionals who can grow your advisory business. Nurturing the next generation of advisors is critical. Today, only 11% of advisors are under age 35. [1] However, as baby boomers are expected to pass down up to $68 trillion of wealth to their Generation X and millennial family members, your credit union needs advisors on tap to build and nurture long-term relationships with these legacies. [2] Work with an external partner or broker/dealer (BD) with deep credit union expertise to employ this model and drive headcount. 

Best Practice 1: BENCHMARK To enhance your wealth management program, set a benchmark to deploy at least one advisor for every $150 million in share deposits

Drive Growth of Your Advisory Business. Working with a credit-union-focused BD also can propel your overall investment services strategy. A qualified BD can help your credit union develop a strategic plan, set company-wide goals that increase the number of members helped with wealth management services, and give you tools and technology to accomplish these goals. 

Look for a BD that offers robust advisor recruitment and onboarding services and marketing resources; has deep compliance and industry knowledge; and can provide ongoing training, education and back-office operations support for financial advisors. Once you have all these resources in place, you then can focus on advisor retention to maintain top performers and their clients.
 
Best Practice 2: BENCHMARK Ensure at least 50% of new investment assets go into advisory accounts.

Deliver Financial Planning. Provide centralized financial planning support for advisors, so they can focus less on administrative tasks and more on client acquisition that will generate long-term value.  
Also invest in data, analytics and product enhancements to drive program growth. Look at your initial benchmarks and success metrics to assess performance and opportunities for improvement.
 
Best Practice 3: BENCHMARK Generate half of your investment services revenue from fees on advisory accounts.

Increase Member Awareness and Drive Referrals. Driving member awareness and referrals is a crucial part of growing your advisory business. Streamline marketing activities across advisors and your credit union’s in-branch and digital marketing activities by working with a strategic partner who can help you:

• Create a 12-month integrated marketing and executional plan. It can include everything from employee engagement and referral programs to marketing campaigns and social media. This will be your go-to guide for going to market successfully and making investment services core to your business.
• Leverage advanced analytics to boost program growth.  Using your proprietary data and supplementing it with financial behavior data will enable you to capitalize on the benefits of predictive analytics. These powerful insights can help you separate existing members into different customer segments.

 
Best Practice 4: BENCHMARK Set a goal to refer at least 1.5% of members to your credit union’s financial advisors every year.
 
Invest in Your Credit Union’s Future
 
Establishing an investment services relationship for members will deepen their connection to your brand— and their trust in it. As research shows, members who enter into this engagement with their credit union do more business with you in the long term. Making investment services core also requires a well-thought-out and integrated strategy where every part of your organization—including advisors—is laser-focused on the benchmarks and goals that will make this new vision a reality.
 
Are you ready to make investment services core to your credit union? Discover more resources and best practices.
 
By Frank Smith, Director, CUNA Mutual Group, Investment Solutions

Sources:
[1] Retirement Income Journal, “Babybust?  Only 11.7% of financial advisors are under 35: Cerulli”, March 8, 2018.

[2] CNBC, “$68 trillion is about to exchange hands in the US,” November 20, 2018. All other data from “Making Wealth Management Core in Credit Unions” by Kehrer Bielan Research & Consulting, sponsored by CUNA Brokerage Services, Inc. (CBSI), February 2019.
 
Securities sold, advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer and investment advisor. CBSI is under contract with the financial institution to make securities available to members. Not NCUA/ NCUSIF/FDIC insured, May Lose Value, No Financial Institution Guarantee. Not a deposit of any financial institution. CBSI is a registered broker/dealer in all fifty states of the United States of America. The representative may also be financial institution employee that accepts deposits on behalf of the financial institution.
 
 
CBSI-2981000.1-0320-0422