Executive Summary 30 May 2008

By Christian Mullins

Executive Summary:

The Federal Bureau of Investigation (FBI) is investigating the theft of over $100,000 from the vault of Houston Police Federal Credit Union, Houston, Texas. The vault cash was verified on Friday, January 25. Employees noticed the discrepancy on Tuesday, January 29, the next time the cash was counted. The FBI suspects the theft was likely committed by a current or former employee.

With an increase in ‘plastic’ use globally, MasterCard Inc announced they expect annual net income growth of between 20% and 30% in 2009, 2010, and 2011. These numbers were revised upward from 15% to 20% growth. In 2008, the company expects to see double digit revenue growth. Note: While this positive news for MasterCard and their stockholders, it will not help their case regarding The Credit Card Fair Fee Act, legislation aimed at curbing what some have called ‘excessive (interchange) fees’ by companies like MasterCard and Visa.

Mortgage rates rose for the first time in four weeks, but remain lower than this time last year, according to mortgage backer Freddie Mac. The 30 year fixed mortgage rate crept over the 6% mark, averaging 6.08% nationally, rising on fears of Federal Reserve rate hikes later this year and a continued deterioration of the housing market. Last year at this time, the 30 year fixed mortgage rate averaged 6.42%.

The FDIC has released a report stating bank profits are down 46% after the first quarter of 2008. Cumulatively, banks earned $19.3 billion during the first quarter of 2008, compared to $35.6 billion in the first quarter of 2007. The $19.3 billion represents a substantial increase, however, from the $600 million profit reported in the fourth quarter of 2007. In addition, the number of banks at financial risk has risen from 53 at this time last year to 90 this year, representing 1.1% of FDIC regulated banks.

International Summary:

Canada

Garth Warner has been named interim CEO of Alberta’s Servus Credit Union, taking over the day-to-day operations from president and CEO Steve Blakely. Warner was previous the Senior Vice President of Operations at Servus. Blakely will focus his efforts on the mega-merger of Servus, Community Savings, and Common Wealth Credit Unions, scheduled for November 1st. Blakely has been named the CEO of the merged credit unions, which will have $9 billion in assets, 1,925 employees, and 92 locations throughout Alberta.

Robbed:

• Nothing to report today.

Arrested, Arraigned, Charged, or Sentenced:

• Susan A. McLain, 26, of Jackson, Michigan was sentenced Thursday to 90 days in jail and ordered to pay $17,612 in restitution for stealing $36,000 from the accounts of mostly elderly members at Jackson Community Credit Union. She had been a teller at the credit union.
• A woman in Worcester, Massachusetts was indicted Thursday for allegedly embezzling over $40,000 from the Norfolk County Employees Federal Credit Union in Dedham. Elizabeth Ann Starkey, 47, was the office manager and only full time employee of the credit union at the time of the alleged theft, a seven month period in 2006 and 2007.