Compliance Specialist Program has ‘Truly Been a Godsend’

Wisconsin CUs lessen regulatory burden by sharing specialists.

April 3, 2013


Complying with extensive NCUA regulations wasn’t a problem for Sentry Credit Union of Stevens Point, Wis., says president/CEO Rex Fair.

Producing the paperwork to prove the $89 million asset, single-sponsor credit union was on the up-and-up? That’s another story.

“We’re stretched about as tight as a rubber band can be stretched,” says Fair, who has 14 employees. “Of the several hats that many of us wear, the one that never seemed to get put on for any length of time was the [one that produced] the documentation of the regulations we’re dealing with.”

As such, NCUA examiners’ visits caused a lot of stress. But that’s no longer the case thanks to Sentry’s participation in the Wisconsin Credit Union League’s Compliance Specialist Program, which rotates a compliance expert through several credit unions each month.

Executives at participating credit unions say the service is considerably cheaper than employing a full-time specialist—especially considering training costs to keep abreast of new regulations. The program provides much-needed stability by eliminating the potential for turnover, and allows employees to concentrate on serving members and fulfilling duties that produce revenue.

“If I went out and found a great compliance person, the biggest problem I have is that [bigger financial institutions] would come to them and say, ‘I can offer twice as much as what he can pay you.’ I wouldn’t blame them for leaving. But then I have to retrain, and there’s a lot of cost and effort involved in that,” says Jack Gill, president/CEO of $88 million asset First Community Credit Union in Beloit, Wis.

“And if I have to become an expert to figure out what my compliance person is doing, I might as well do it myself.”

The idea has been a big hit in Wisconsin, where 23 of the state’s approximately 190 credit unions (12%) enrolled in the first two years. The clients range from less than $20 million to more than $200 million in assets. Some shift the bulk of the compliance workload to the specialist, while others aim to ease the burden on in-house staff.

“For us, it’s truly been a godsend,” says Steve Nothem, president/CEO of $73 million asset Premier Financial Credit Union of New Holstein, Wis. “We could have just struggled along, but we wouldn’t have been as good or as accurate, and with one exam we might have had to rip everything apart. The peace of mind is huge.”

The specialists’ impact can be huge, too.

Lynn Schaufenbuel works seven days per month at $63.3 million asset Hayward (Wis.) Community Credit Union. Among other tasks, she redrafts policies, reviews loan files, and ensures proper documentation for loan decisions, says CEO Cliff Williams.

“Lynn knows this stuff inside and out because she not only came to us already trained, but has worked on similar issues before,” Williams says.

Schaufenbuel also works one week per month at Sentry, where she crafted a schedule to review all policies annually to ensure compliance with NCUA. Additionally, Fair compiles an agenda before each of Schaufenbuel’s visits based on input from staff.

“Lynn has been instrumental in helping us change some of the ‘We’ve always done it this way’ items,” Fair says. “She’s a catalyst for change in how the credit union is governed and managed.”