Be nimble to address uncertainty
Be curious and aware of the risks that may impact your credit union, says Faith Anderson.
From disastrous storms to new regulations, Faith Anderson, senior vice president and general counsel at $8.9 billion asset American Airlines Federal Credit Union in Dallas and chair of CUNA Compliance and Risk Council, discusses handling uncertainty.
CUNA News: What are the biggest compliance and risk issues credit unions currently face?
Faith Anderson: Cybersecurity is a major concern. Fraudsters are becoming more sophisticated and may be able to take over a credit union’s system when employees unknowingly click on phishing emails.
Also, we have to be aware of potential regulations coming from the Consumer Financial Protection Bureau (CFPB). In the past, some credit unions were forced to stop offering certain products such as mortgages if their third-party vendor refused to comply with new regulations, or it became too expensive to comply.
And we have to keep attracting a younger generation of members. They were especially drawn to popular fintechs and large banks during the pandemic. We don’t want to become the next Blockbuster.
Q: How do you address these concerns?
A: We train employees to recognize fraud by performing regular phishing tests, providing information to employees, and holding contests.
We work with CUNA on regulatory proposals that could have a negative impact on credit unions or our members. We also write comment letters.
We’re always looking for ways to educate the younger generation about what credit unions can offer them. Credit unions also partner with fintechs to offer products and services we can tailor to our members.
Q: How can credit unions prepare for future and emerging risks?
A: We need to remain curious and aware. Credit unions are great about sharing information on risks, and that informs our strategic risk planning.
Q: How does climate change factor into credit unions’ risk management plans, and how do you address the increased possibility of weather-related events?
A: We had “Snow-Mageddon” in Texas this past February, with widespread electrical outages where folks lost heat and water pipes burst. Fortunately, our credit union didn’t lose power, but some of our employees did.
We opened our doors, and some employees and their families spent a few nights at the credit union. Members who couldn’t get online to access their accounts could call our phone center or visit a branch.
For these types of situations, a credit union must be nimble. A lot of credit unions have business continuity plans that provide guidance for weather issues like hurricanes or tornadoes.
We also provide disaster loans in FEMA-declared areas that are non-credit qualifying, which allows members to purchase a generator or other needed supplies.
Q: What is the most interesting part of your role?
A: My role keeps evolving. Early on, I was fortunate to be on the Federal Reserve Advisory Council.
Since then, I’ve testified before Congress and was on the CFPB’s Credit Union Advisory Council. Now, I’m chair of the CUNA Compliance and Risk Council. I’ve definitely found my voice advocating for credit unions.