Even once resolved, UNI's technical issues may lead to client distrust, says prof
The credit union's customers have had problems with online banking since last week
With many clients unable to deposit cheques or access their accounts online, one expert says the bank may face serious repercussions even after the technological problems are resolved.
"Technical and technological issues happen. Now this is on a bigger scale because this is people's livelihoods," said Omar Fares, lecturer on retail management at Toronto Metropolitan University.
"Given the trajectory of where things are going, there may be a hit on UNI and customers' trust will take time [to rebuild]."
The Acadian bank has been experiencing technical challenges since separating from Desjardins Group to launch its own online banking platform. Some customers discovered their most recent pay didn't arrive in their accounts, something UNI described in an update Sunday as "payroll deferral."
UNI CEO Robert Moreau said some crucial improvements will be made as quickly as possible, such as making it possible to make a bill payment at an ATM.
"I can assure you that we will work tirelessly, 24 hours a day, to correct these irritants," said Moreau.
Despite the technical challenges, 68,000 people have registered an online profile with the bank.
Fares said this does not come as a surprise.
Credit unions a community
"With a credit union, there is such a community focus … so clients are in a sense a little bit more forgiving than traditional banking institutions."
However, Fares said UNI should be giving customers daily updates to avoid further frustrations and distrust.
"Your customers will make assumptions, right?" Fares said. "'Why did the system drop?' 'Was there any data leakage?' These are issues if the bank does not bring up proactively, it will be in terms brought up from the customer side."
Fares said once UNI's online banking platform is finally up and running, the bank will have to try to make up for frustrations their clients experienced.
"It takes a very long time to build trust and we've seen it takes a few days and a technological issue to destroy the trust," said Fares.
Gov't took 15 months to act over troubled caisse: affidavit
CBC News · Posted: Apr 17, 2007 12:37 PM AD
The former Tory government in New Brunswick was asked to crack down on the Caisse Populaire de Shippagan 15 months before action was finally taken, according to an affidavit obtained by CBC News.
Last month, the province announced a $60-million grant to sort out the credit union industry in the province, and $41 million of it went to bailing out the Shippagan caisse, which had a debt of about $60 million. Ever since that announcement, the Opposition Conservatives have been hammering the government, saying the money should have been a loan, not a grant.
In return, the Liberals said the Tories knew problems were building up when they were in power. The caisse first started to see financial trouble in 2004, as the result of a series of bad loans.
The delay in putting the caisse under supervision, revealed in the affidavit,also delayed efforts by an industry stabilization board to force the caisse to change the way it does business.
In 2002 the caisse in Shippagan was part of the anglophone Credit Union Central of New Brunswick and came under the authority of the Credit Union Central stabilization board and fund.
The board's administrators were increasingly concerned with the caisse's aggressive business practices, and the financial risks they created.
Following an audit, the board gave the caisse a list of 10 orders to comply with, but the caisse fought those orders in court.
What happened next is explained in an affidavit by Darrell Kuhn, the CEO of Credit Union Central."
CBC News · Posted: Apr 24, 2007 4:00 PM ADT
"A Moncton-based caisse populaire ran up a $5 million deficit last year, the latest hit to New Brunswick's francophone credit union system, but an expert says the recent trouble doesn't make credit unions less reliable than banks.
The Caisse Populaire de Shippaganmade headlines recently when the province agreed to give it a $41 million bailout. Now, the Caisse Populaire Beauséjour has released data showing it is more than $5 million in debt due to bad loans.
Camille Thériault of the Fédération des caisses populaires acadiennes announced Monday the problem was discovered during the regular 18-month audits of the caisse.
Université de Moncton co-op management specialist André Leclerc says some bank branches may have just as many problems, but don't tell the public about them.
Reply to David Amos
Radio Canada
Posted December 29, 2016 3:58 PM
After having worked for 12 years for the development and sustainability of the Fédération des Caisses populaires acadiennes, Camille Thériault passes the torch to his successor.
When Mr. Thériault took over the management of the Fédération des Caisses populaires acadiennes, he had only one idea in mind: to embody change.
"We always tried to look to the future [...] to ensure that people, young people, continue to have the best financial services," he says.
Among the first major changes that the caisses underwent was their change of name and consolidation under UNI Financial Cooperation.
Camille Thériault explains that New Brunswickers were especially shocked by the removal of the “Acadian” aspect of the banner. He is rather convinced that it was no longer necessary.
“Today's young people are Acadians They don't need to have a flag on their backs to say that they are Acadians in their hearts, they know it, and back home we are Acadian, we will always be Acadian. The star is still there and it shines brighter than ever,” assures the former CEO.
Read also: "The caisses of today are made for the rich" - the ex-CEO of Desjardins Claude Béland
Mr. Thériault also felt it necessary to reduce the number of branches to be more competitive. “We had 90 points of service and all the other banks together in the French-speaking region of New Brunswick, there were not 50,” he noted.
The man who was also Premier of New Brunswick and President of the Transportation Safety Board of Canada intends to remain present in the public sphere. The project he is currently considering is to raise $50 million as part of the fundraising campaign launched by the Université de Moncton.
Reply to Ben Haroldson
Reply to David Amos
Volpé, accused of threatening civil servant, apologizes
CBC News · Posted: Apr 13, 2007 12:21 PM ADT
Volpé made the comment in question while meeting with Robert Penney, the superintendent of credit unions. The politician was angry about Penney's suggestion that, when Volpé was a cabinet minister, he had been warned about potential irregularities at the Caisse Populaire de Shippagan.
In a transcript of the meeting released Thursday,Volpé is recorded as saying to Penney: "I will not let my name go in the dirt. If there is something in life that I said is important to me, it's integrity, so it will not go down, or a lot of people will go down with me, so it has to be fixed."
"I will be quite frank," Penney replied. "That sounds threatening in tone."
"That is just my way. All I am saying here is something is happening here that is not good," Volpé said.
The controversy follows the Liberal government's decision to give the financially troubled Caisse a $41-million bailout.
Attorney General T.J. Burke announced last week that the RCMP had been asked to look into why the Caisse lost so much money.
Journalists were told that the Mounties would be looking for red flags such as large deposits coming from outside the normal business area that might point to money laundering.
Volpé has demanded Burke resign over his comments, saying he prejudged a police investigation by suggesting police might find evidence of money laundering in the case.
Volpé also accused the government of releasing the transcript in a bid to distract the public from Burke's comments.
The transcript has Penney confirming he never used the words "money laundering" or "red flags" when he met with Volpé about the Caisse's situation in 2006.
Reply to David Amos
CBC News · Posted: Mar 16, 2007 12:02 PM ADT
Last week, the Liberal government announced its plan to return the caisse to the security of the Fédération des caisses populaires acadiennes, more than 20 years after the two separated and the caisse joined the anglophone Central Credit Union of New Brunswick. However, the government didn't give financial details.
Finance Minister Victor Boudreau said that $60 million in Tuesday's budget is going to the stabilization board and the Central Credit Union of New Brunswick's risk management board, as a maximum amount to stabilize the troubled credit union.
Boudreau wouldn't say how much of that $60 million will be injected into Shippagan's credit union or whether it's a grant, a loan or a loan guarantee. However, he has said the credit union's future depends on it.
John Williamson from the Canadian Taxpayer Federation said New Brunswickers should pay close attention to the $60 million set aside, because it's roughly the same amount they'll be paying in tax increases in 2007.
"I'd want to know why taxes are going up to pay for bailouts, as opposed to having governments spend money in priority areas," Williamson said Thursday.
"Governing is all about making choices and prioritizing spending. In this case, we have a government which has obviously decided that saving a credit union is worthwhile, despite the fact that no one from the province seems able to explain why it's in the province's interest, or why it's in the taxpayer's interest, to be spending this kind of money."
Reply to michael levesque
Despite days of customer troubles, CEO defends UNI's move to new online platform
Robert Moreau says new system will better serve customers once the problems are fixed
"We will get through this, and each member and customer will be served accordingly," Moreau said Thursday at a news conference.
For years, UNI relied on the Quebec-based Desjardins Group for its online platform but needed one tailored to its own needs in New Brunswick.
Moreau said this new platform will better meet the needs of the credit union's members and customers.
UNI,
also known as Caisse Populaire, is a credit union headquartered in
Caraquet, in northeastern New Brunswick, that serves about 180,000
customers. (Patrick-Lacelle/Radio-Canada)
"We've demonstrated that we were able and capable now to kind of fly on our own.They've helped us through this transition all the way."
Moreau said the new system will allow UNI to "better respond to the unique needs of our francophone and Acadian customers in New Brunswick."
UNI, also known as Caisse Populaire, is headquartered in Caraquet, in northeastern New Brunswick, and serves about 180,000 customers.
About 155,000 customers were supposed to transition to the new platform on July 6, but technical issues have plagued the system for some customers across the province.
Moreau said that despite the problems, "most of the banking services are stable."
He said 75 per cent of members have successfully activated their new debit cards and 65 per cent have activated their online profiles over the past two weeks.
Moreau would not commit to a date when the problems will be fixed, but he said he expects the inability to pay bills using the ATM will be resolved "shortly."
"Teams are working around the clock," he said.
As for other outstanding issues with the system, he said, those are being addressed "issue by issue and matter by matter."
The timing of the launch of the new online platform has disrupted summer vacations for some customers.
Danielle Soucy, who has been with the bank since she was 13, was unable to pay bills or transfer money to her credit card.
When she was left on a vacation to Virginia, she was unable to pay for gas or withdraw money to change into U.S. currency.
Both
lack of access to online services and little reassurance from UNI’s
customer service has led to increasing disappointment for UNI’s
clientele. (Jonathon Collicott)
"Of course I could have planned ahead of time, but you don't expect your bank to stop working out of the blue just before you leave the country," she told CBC.
Other people have complained about not getting their pay in their accounts. Many people who normally do their banking online or at an ATM were forced to visit a credit union branch.
When pressed about the decision to launch the new online system now, Moreau said, "there are no perfect dates."
UNI and their partners were confident "the time was right," he said.
"In hindsight, there are always lessons to be learned."
Moreau thanked the bank's customers and members for their patience during a turbulent time.
"We absolutely understand that this hasn't been an easy transition for some of our members, there's no question about that.
"We recognize that this period will be a test of our member's loyalty."
Moreau said customers who are concerned about being charged fees or interest for late payments will not incur any additional costs because of these technical problems.
"We will make sure we take care of them," he said. "We will not stop until our clients are 100 per cent satisfied with our service."
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Do those folks use their money differently???
Desjardins platform worked well and seemed secure and reasonably trustworthy. I suspect Casse Pop didn't want to pay for it and thought they could implement their own system cheaper. NOPE!
Pay day mayday for some N.B. credit union clients as paycheques not appearing in accounts
UNI Financial Cooperation customers face issues with credit union for fourth straight day
For the fourth day in a row, customers of UNI Financial Cooperation across the province have been plagued by problems with its online services, this time, with some reporting their paycheques not showing up.
Jeremie LeBlanc took time off work Thursday to visit UNI's Fredericton branch after noticing that very issue with his own account.
"This morning I was expecting to see my pay into my account, but that wasn't the case."
LeBlanc said he wasn't the only one at the branch on Regent Street with the same issue that morning.
"I did see some folks that were frustrated that they didn't have their pay in their account, or they didn't have access to their online banking as they usually do," he said.
WATCH | No money, more problems for UNI and their customers:
He said staff were sympathetic and offered a small loan if he needed to pay any bills urgently, but added he's disappointed with the apparent gaffe.
"It does feel like a big oversight. I feel like in this day and age, especially with all the IT resources available, I feel like this roll-out should have been a bit more seamless and maybe not impact as many people as it did."
UNI, also known as Caisse populaire, is a credit union headquartered in Caraquet serving about 180,000 customers.
After years of relying on Desjardins Group for its online banking platform, the company decided to launch its own.
About 155,000 customers were supposed to transition to the new platform on July 6, but bumps in the process led to problems for customers across the province, with cards not working and people not being able to access their online accounts.
Paycheques will show up later Thursday: UNI
CBC News did not receive a response from UNI for an interview request about the paycheque problems being reported Thursday.
The company, however, issued a statement on Facebook Thursday morning saying the problem should be fixed by later in the day.
"Over the weekend, with the technological shift, we had to postpone some payroll deposits, which created a temporary bottleneck," said UNI, in its online post.
"We are currently in catch-up mode for these deposits, and all resources are working hard to restore the situation as soon as possible.
"For those who were expecting their pay today, we are currently processing all of these deposits, which will be deposited into your accounts later today."
WATCH | Customers left in the lurch as credit union remains offline:
Some GNB employees affected
It's unclear how many people have been hit by issues with UNI Financial Cooperation's services, but the Government of New Brunswick says some of its employees were affected.
David Kelly, spokesperson for the Finance and Treasury Board, in an email said "bank files have transferred" to UNI without error.
"We have, however, received phone calls this morning from a small number of Government of New Brunswick employees experiencing issues and have encouraged them to reach out directly to UNI to resolve."
LeBreton Fisheries and Sons Ltd., a seafood company in Grand-Anse, released an advisory to its employees on Facebook Thursday morning regarding their pay.
"If you are with the UNI financial institution, you probably did not receive your pay this morning like most of their members," said the company, in its online post.
"To our understanding, this is not unique to our company, it is a general problem at UNI. We are in contact with UNI service and will update you as soon as possible."
CBC News contacted LeBreton Fisheries by phone Thursday and an employee declined an interview request.
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Frustration continues as N.B. credit union works to fix online banking disruptions
Customers showed up at Fredericton branch hoping to sort out problems
A steady stream of people walked into and out of the UNI Financial Cooperation in Fredericton at around noon, with some there in the hopes of solving issues ranging form not being able to access their accounts online, to their bank card not working at point of sale machines.
They're issues being felt by UNI clients across the province for the third day in a row.
"The frustration of nothing working," is what brought Jessica Courty to the branch on Regent Street.
"It's been four days that I have zero access to my banking account, can't do any transfers or receive them, or know how much I have in my bank account right now."
Jessica Courty said she had no access to her online account for four days. (Pat Richard/CBC)
Courty said she considered herself lucky she's off work in the summer and had the time to go to the bank in person while it was open.
"I can only imagine people that have kids or jobs and you cannot really come during the hours that they are open. It would have been like another level of frustration."
UNI, also known as Caisse populaire, is a credit union headquartered in Caraquet serving about 180,000 customers.
After years of relying on Desjardins Group for its online banking platform, the company decided to launch its own, CEO Robert Moreau, said in an interview.
About 155,000 customers were supposed to transition to the new platform on July 6, but bumps in the process led to problems for customers across the province, with cards not working and people not being able to access their online accounts.
UNI
Financial Cooperation CEO Robert Moreau says the company is dealing
with issues as they're brought to their attention, and has extended
business hours at its branches to better help customers. (Zoom/CBC)
"It could be very technical on the card itself," Moreau said. "It can be that [with] the personal identification number, they don't have it, they lost it or it's not working properly," Moreau said.
Moreau said not all customers are experiencing those issues, adding that "most transactions" are happening properly across its system.
Moreau didn't offer a timeline for addressing issues for affected customers, noting that UNI is learning about some problems only as clients come forward with them.
"Some of it, you deal [with it] as it comes," he said. "Then you get into efficiency, so if we see ... too many of a certain complaint then we we get to address that."
He said for those experiencing problems, the company responded by opening its branches last weekend, and extending the opening hours for its branches throughout this week as well.
"Come and see us and and we will help you out. There's no, there's no question about it," Moreau said.
"We'll make sure that your deposits are done. We'll make sure that your withdrawals are done. We'll make sure that your payments are done."
Renee Bourgoin decided to do just that on Wednesday.
Renee
Bourgoin showed up at the UNI branch in Fredericton after UNI failed to
send her the access code she needed to get into her online account. (Pat Richard/CBC)
She said she was supposed to receive information in the mail to give her access to her online account under the new platform.
That mail came, but without the access codes she needed.
"I didn't have access to my finances and my banking information," Bourgoin said.
"I came in last week, they were able to help me out in the interim, which was really helpful, but it's still a little alarming to not be able to access the information in your accounts."
Bourgoin said she got what she needed from her visit to the branch on Wednesday, and the issue should be sorted out.
"The staff have been incredible, incredibly helpful."
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Credit union hits hard times
One of New Brunswick's biggest credit unions is in trouble because of bad loans.
Directors of the Caisse Populaire de Shippagan have asked for help from the province's credit union stabilization board.
That comes as the Caisse tries to deal with a portfolio of commercial loans that aren't being repaid.
Bank officials say the situation doesn't mean members will lose their money.
The Shippagan Credit Union controls about $300 million in assets. It has about 36,000 members, and more than 100 employees in northern New Brunswick.
Shippagan Credit Union is not part of the Federation des caisses populaires acadiennes and ceased being a member more than 23 years ago.
$31.5M grant for Shippagan caisse goes too far: Volpé
New Brunswick's Opposition leader is warning that the province's credit rating could be damaged by a possible $60-million bailout of the Caisse Populaire de Shippagan.
The Liberal government is granting $31.5 million to help the francophone credit union's debt, caused by a series of bad loans over four years. The province is investing $10 million more in repayable shares, and another $19 million to stabilize deposit insurance for New Brunswick credit unions and caisses.
The $60 million, equal to the caisse's individual debt was earmarked in the government's first budget,earlier this month, as money for the province's anglophone and francophone credit union systems, as a maximum amount to stabilize the Shippagan caisse. The budget also included a personal income tax hike that will result in a further $50 million for the government.
In the Legislature Tuesday, Opposition leader and former finance minister Jeannot Volpé condemned the deal, drawing a link between the $60 million set aside for credit unions and the $50 million to be generated by personal income tax.
The province insists it had no other option, because the former Tory government did nothing to resolve the situation, and taxpayers were on the hook for $85 million if the credit union failed.
Volpé says his government tried to help the caisse through loans, not grants. He says the grant opens a door that hasn't been opened before, and the federal government's credit rating agency will be paying close attention.
"The credit rating agency will even look at it because we've opened the door, we've given a huge grant to someone doing business in New Brunswick," he said. "What's next? The banks? What's next, the pension funds maybe that are unfunded? They've opened that door that was not opened before."
However, Justice and Consumer Affairs Minister T.J. Burke says the former government has to take the blame for the problem of the caisse, which has been "bubbling over," he said, since 2004.
But the Tories say they were pursuing a solution that was much cheaper to taxpayers. Tory MLA for Riverview and former minister of justice and consumer affairs Bruce Fitch says the former government's plan involved a $30-million repayable loan.
Fitch says the Conservatives tried to fix the
problems with the struggling Caisse, and he says the price tag on their
solution would have cost less than $2 million. However, the
Conservatives never struck that deal.
"They did nothing," Burke
said. "They didn't have an annual general meeting, which was required
by law. They ended up getting exemptions under the act, so that it
didn't have to take place, so the members of the credit union couldn't
see the audited financial statements at year's end. They didn't appoint a
superintendent of credit unions until August of last year."
That superintendent, Robert Penney, says he plans to toughen up the Credit Unions Act.
"The teeth would be in the regulatory process, in terms of improving the appeal and oversight process, to make the impact of negative inspections immediate," he said Tuesday.
With the Opposition leader drawing a link between the credit union bailout and the Graham government's raising an extra $50 million from personal income tax hikes, the stage seems set for a continuing political war over who is to blame for the $60-million bill.
$31.5M caisse bailout cheaper than failure, Burke says
Consumer Affairs Minister T.J. Burke is defending his government's $31.5 million bailout of a struggling credit union, saying it would be more expensive for New Brunswick if the financial institution folded.
"Had we not intervened, the Caisse Populaire de Shippagan may have had to face the possibility of liquidation, which could potentially have cost the taxpayers of New Brunswick in excess of $85 million," he said Monday.
The Liberal government's first budget, which came down this month, earmarked a possible $60 million to help stabilize New Brunswick's Credit Union system, and a maximum amount to stabilize the troubled Shippagan institution, which has lost $60 million over the past four years.
New Brunswick's superintendent of credit unions, Robert Penney, broke down the details of the funding Monday.
He said the governmentwill grant $31.5 million to the New Brunswick Credit Union DepositInsurance Corp., which will give the money to the stabilization board ofthe Fédération des caisse populaires acadiennes. The stabilization board will in turn grant it to the caisse.
Penneyalso
said the province will grant another $18.5 million to the deposit
insurance corporation, as a kind of life insurance for the credit union
system.
Burke said the bailout was needed because legislation
enacted under the previous Conservative government holds the province
responsible for 100 per cent of all deposits if a credit union goes
under.
The Liberals plan to introduce new legislation to change that, he said.
The Caisse Populaire in Shippagan will receive the government money June 1, when it will move from the anglophone Credit Union Central of New Brunswick federation back to the francophone federation, which it left after a dispute in the early 1980s.
Robert Moreau will be UNI's new Chief Executive Officer
The President of UNI Financial Cooperation’s Board of Directors, Pierre-Marcel Desjardins, announced today the appointment of Robert Moreau as Chief Executive Officer of the institution.
He will thus replace Camille H. Thériault who will step down on December 31, 2016 after 12 years at the helm of the Caisses populaires acadiennes, as announced last September. UNI Financial Cooperation’s new Chief Executive Officer will take office at the beginning of 2017.
“The Board is very happy with its decision, especially since the chosen candidate is from our region and knows UNI very well, ensuring consistency and stability. These past years, we went through significant changes to become more flexible and efficient and it is obvious that the new Chief Executive Officer’s challenge will be to lend impetus to the institution, optimizing customer experience while remaining aware of the rapidly changing industry,” said Pierre-Marcel Desjardins.
Mr. Moreau has been UNI’s Vice-President, Corporate Services since September 2015. He holds the CPA, CGA designations, as well as the ICD.D title from the Institute of Corporate Directors. He was previously Vice-President and Chief Executive Officer of Assumption Life after having been Imperial Manufacturing Group’s Chief Financial Officer. He is also the current President of the Conseil économique du Nouveau-Brunswick and a member of many provincial boards of directors.
Finally, it is noteworthy to mention that Robert Moreau will become the 6th person to hold office as the financial cooperative’s highest executive position.
- 30 -
About UNI Financial Cooperation
Since 1936, UNI Financial Cooperation has been the most important Acadian financial institution, armed with its $3.7 billion in assets and its 1,000 employees. Thus, every day, the institution strives to inspire, support and fund the individual and collective assets of New Brunswickers. For more information, visit www.uni.ca
FOR MORE INFORMATION
Communication Team
295 Saint-Pierre Blvd. West
P.O. Box 5554
Caraquet NB E1W 1B7
E-mail: communication@uni.ca
For additional information:
Mario Griffin
Communications and Public Relations Consultant
mario.griffin@acadie.com
Telephone: 506 726-4785 Cell : 506 724-0078
Up to $60M to go to Shippagan's credit union
The New Brunswick government has set aside up to $60 million to save Shippagan's financially strapped credit union but a taxpayer advocacy group suggests the Liberals should be spending the money "in priority areas."
The Caisses Populaire de Shippagan, which has been in financial trouble for the past three years, was placed under the control of the Central Credit Union of New Brunswick's risk management board in 2004 after a series of commercial loans were not repaid.
Last week, the Liberal government announced its plan to return the caisse to the security of the Fédération des caisses populaires acadiennes, more than 20 years after the two separated and the caisse joined the anglophone Central Credit Union of New Brunswick. However, the government didn't give financial details.
Finance Minister Victor Boudreau said that $60 million in Tuesday's budget is going to the stabilization board and the Central Credit Union of New Brunswick's risk management board, as a maximum amount to stabilize the troubled credit union.
Boudreau wouldn't say how much of that $60 million will be injected into Shippagan's credit union or whether it's a grant, a loan or a loan guarantee. However, he has said the credit union's future depends on it.
John Williamson from the Canadian Taxpayer Federation said New Brunswickers should pay close attention to the $60 million set aside, because it's roughly the same amount they'll be paying in tax increases in 2007.
"I'd want to know why taxes are going up to pay for bailouts, as opposed to having governments spend money in priority areas," Williamson said Thursday.
"Governing is all about making choices and prioritizing spending. In this case, we have a government which has obviously decided that saving a credit union is worthwhile, despite the fact that no one from the province seems able to explain why it's in the province's interest, or why it's in the taxpayer's interest, to be spending this kind of money."
Opposition
critic Bruce Fitch said he wants details now on how the province plans
to save the credit union. "Sixty million dollars is a substantial amount
of money and I'd like to know exactly what it is going to be used for,"
he said.
The province will release exact dollar amounts at a meeting with the Caisse de Shippagan on March 26.
Camille Theriault of the Fédération des caisses populaires acadiennes said that ignoring the struggling credit union was not really an option for government.
"What would happen is that the government would have to liquidate the Caisse Populaire de Shippagan and my impression is that that would be a lot more expensive than looking at the funds that would be involved in the rehabilitation of the Caisse Populaire de Shippagan," Theriault said.
The Shippagan caisse split with its Acadian counterparts in 1982 over a difference of opinion. It joined forces with the anglophone Central Credit Union of New Brunswick.
The Caisse de Shippagan is set to rejoin the federation in June.
Burke calls for RCMP investigation into Shippagan caisse
The
New Brunswick government has asked the RCMP to launch a criminal
investigation into the troubled Caisse Populaire de Shippagan.
Attorney General T.J. Burke said Wednesday there may have been "improprieties" at the caisse.
Last month the province announced a $60-million grant to sort out the credit union industry in the province, and more than half of that was togo to bail out the Shippagan caisse.
Ever since that announcement, the
Opposition Conservatives have been hammering the government, saying the
money should have been a loan, not a grant.
In return, the
Liberals said the Tories knew problems were building up when they were
in power; the caisse first started to see financial trouble in 2004, as
the result of a series of bad loans.
Today, Burke took the controversy a step further, announcing he'd called in the RCMP to help answer questions about how the previous management ran the caisse, and got it so deep into debt.
"There is a possibility that there has been some impropriety with respect to large transactions coming into a financial institution and coming out so quickly."
He said the Tories may not like what the investigation turns up.
"As we peel the layers of this onion, the smell of it is just getting stronger and stronger."
Last
month, Burke suggested a relative of Tory MLA Paul Robichaud was on the
board of the caisse, and that Tory attacks on the bailout were meant to
"protect" that relative.
Wednesday, Robichaud said,"I welcome the investigation. We're not against the investigation."
But
his leader, Jeannot Volpé, said the government is calling in the police
to distract the public from the controversy over the grant.
Meanwhile, Burke has also asked the auditor general to look into the caisse's troubled history.
Volpé, accused of threatening civil servant, apologizes
Jeannot Volpé apologized Friday, after New Brunswick's superintendent of credit unions accused the Tory Opposition leader of threatening him while discussing the Caisse Populaire de Shippagan earlier in the week.
"Because of the importance I place on personal integrity, I wish to apologize this morning if anything I said during that meeting offended anyone in the provincial civil service or made an official feel pressured," Volpé said in Friday's legislature.
"That was not my intention, and that's not the way I conduct myself as an MLA or as leader of the opposition."
Volpé made the comment in question while meeting with Robert Penney, the superintendent of credit unions. The politician was angry about Penney's suggestion that, when Volpé was a cabinet minister, he had been warned about potential irregularities at the Caisse Populaire de Shippagan.
In a transcript of the meeting released Thursday,Volpé is recorded as saying to Penney: "I will not let my name go in the dirt. If there is something in life that I said is important to me, it's integrity, so it will not go down, or a lot of people will go down with me, so it has to be fixed."
"I will be quite frank," Penney replied. "That sounds threatening in tone."
"That is just my way. All I am saying here is something is happening here that is not good," Volpé said.
The controversy follows the Liberal government's decision to give the financially troubled Caisse a $41-million bailout.
Attorney General T.J. Burke announced last week that the RCMP had been asked to look into why the Caisse lost so much money.
Journalists were told that the Mounties would be looking for red flags such as large deposits coming from outside the normal business area that might point to money laundering.
Volpé has demanded Burke resign over his comments, saying he prejudged a police investigation by suggesting police might find evidence of money laundering in the case.
Volpé also accused the government of releasing the transcript in a bid to distract the public from Burke's comments.
The transcript has Penney confirming he never used the words "money laundering" or "red flags" when he met with Volpé about the Caisse's situation in 2006.
Gov't took 15 months to act over troubled caisse: affidavit
The former Tory government in New Brunswick was asked to crack down on the Caisse Populaire de Shippagan 15 months before action was finally taken, according to an affidavit obtained by CBC News.
Last month, the province announced a $60-million grant to sort out the credit union industry in the province, and $41 million of it went to bailing out the Shippagan caisse, which had a debt of about $60 million. Ever since that announcement, the Opposition Conservatives have been hammering the government, saying the money should have been a loan, not a grant.
In return, the Liberals said the Tories knew problems were building up when they were in power. The caisse first started to see financial trouble in 2004, as the result of a series of bad loans.
The delay in putting the caisse under supervision, revealed in the affidavit,also delayed efforts by an industry stabilization board to force the caisse to change the way it does business.
In 2002 the caisse in Shippagan was part of the anglophone Credit Union Central of New Brunswick and came under the authority of the Credit Union Central stabilization board and fund.
The board's administrators were increasingly concerned
with the caisse's aggressive business practices, and the financial risks
they created.
Following an audit, the board gave the caisse a list of 10 orders to comply with, but the caisse fought those orders in court.
What happened next is explained in an affidavit by Darrell Kuhn, the CEO of Credit Union Central.
In March 2003, Kuhn asked the province's acting superintendent of credit unions, Suzanne Bonnell-Burley, to put the Shippagan caisse under supervision. That would give the board the power to force the caisse to comply with its orders.
"By way of letter dated March 21, 2003, the [Credit Union Stabilization Fund] requested supervisory powers from the superintendent," the affidavit reads.
According to Kuhn's affidavit, the provincial superintendent never responded in writing to the request.
"Although the CUSF requested a formal response in writing by March 31, 2003, the Superintendent has never provided any written response to the request for supervisory powers."
It was another15 months before the Shippagan Caisse was finally put under supervision in June 2004, and forced to hire new management and change its business practices.
It's not clear from the court affidavit whether that delay added to the caisse's losses — losses that eventually led to last month's $41-million government bailout.
Caisse Populaire Beauséjour has $5M deficit
A Moncton-based caisse populaire ran up a $5 million deficit last year, the latest hit to New Brunswick's francophone credit union system, but an expert says the recent trouble doesn't make credit unions less reliable than banks.
The Caisse Populaire de Shippaganmade headlines recently when the province agreed to give it a $41 million bailout. Now, the Caisse Populaire Beauséjour has released data showing it is more than $5 million in debt due to bad loans.
Camille Thériault of the Fédération des caisses populaires acadiennes announced Monday the problem was discovered during the regular 18-month audits of the caisse.
Université de Moncton co-op management specialist André Leclerc says some bank branches may have just as many problems, but don't tell the public about them.
"For the banks, we don't have any information at the branch level, but that doesn't mean they don't have financial problems," Leclerc said Tuesday.
"If a branch has financial problems in a bank, it will be covered by all the networks. So, the network is making lots of profits, but that doesn't mean there is no branch [without] financial problems."
The Moncton caisse was put under trusteeship at the beginning of the year, and Thériault said the federation is considering shortening the time between audits to every 12 months. Thériault said the caisse will follow up on all loans that are in default.
Shippagan caisse bailout could have been avoided: AG
New Brunswick's auditor-general has issued a damning report on the taxpayer-funded bailout of the Caisse populaire de Shippagan, blaming the former Progressive Conservative government for failing to properly regulate the northern financial institution.
Auditor General Mike Ferguson released the 53-page report on Tuesday that also said a handful of senior managers at the caisse populaire covered up financial problems.
'Had the superintendent taken action when [Credit Union Stabilization Fund and Risk Management Agency] recommended it, the total loss to New Brunswick taxpayers would probably have been about half of what it eventually was.'— Auditor General's report
The Liberal government bailed out the northern caisse populaire in 2007 with a $37-million grant and another $16.5-million in guarantees.
The influx of government funds were to offset massive losses at the caisse populaire.
The report said it all could have been avoided.
Ferguson said Belonie Mallet, the institution's general manager, committed "irregularities" that covered up losses at the caisse populaire while he personally benefited.
"We believe that some of the actions of the former general manager, Mr. Belonie Mallet, caused financial harm to [caisse populaire] while at the same time appearing to be to his personal benefit," Mallet said
The report also indicates that the institution's board failed to provide proper oversight until it was too late.
Government regulation failed
But Ferguson also blames the former Bernard Lord government for failing to properly regulate the caisse populaire.
"Ultimately the government's regulation of [caisse populaire] failed. It failed as early as 1981 with the decision to allow [caisse populaire] to move to Credit Union Central; it failed to properly interpret the symptoms of serious trouble that it had before it in the late 1990s and early 2000s; and it failed to take appropriate action even when the organization responsible for inspections realized the gravity of the situation," the report said.
The report indicated the province's superintendent of credit unions, an employee in the Department of Justice and Consumer Affairs, took months and in some cases years to make decisions based on problems that should have been obvious.
The auditor general's report indicated those problems were partly the provincial government's fault because the superintendent was working part-time and had been ordered to focus on issues other than the caisse.
Ferguson said if the superintendent had acted between 2001 and 2003, when the Conservatives were in office, much of the losses might have been prevented.
"Had the superintendent taken action when [Credit Union Stabilization Fund and Risk Management Agency] recommended it, the total loss to New Brunswick taxpayers would probably have been about half of what it eventually was," the report said
PC MLA Carl Urquhart played down the former Conservative government's failures when speaking on Tuesday.
"The fact that things were going on that was wrong. The people who were responsible for that are still responsible for that, whether it was stopped sometime along the way," Urquart said.
N.B. auditor general releases report on financial woes at credit union
This article originally appeared on 680news.com
Posted Jan 19, 2010, 10:36PM EST.
A long-awaited investigation by New Brunswick’s auditor general into the near collapse of Caisse Populaire de Shippagan has revealed a string of failures ranging from the credit union’s mismanagement to shabby accounting.
In a sweeping report released Tuesday, Mike Ferguson pieces together the sequence of events that brought the northern financial institution to its knees in 2007, leading the Liberal government prop it up with a nearly $40-million bailout.
The 54-page report identifies the failures in the chain of command _ from the credit union’s senior staff to the province’s regulatory regime _ that allowed the credit union to fudge its financial results, fattening the salaries of some senior management.
“Failure … of the former senior management team … failure of the board of directors at the time to provide effective oversight … and failure of the auditors,” Ferguson states in the report.
But New Brunswick’s former Conservative government also shoulders some of the blame, the report states, for failing to ensure adequate regulation and supervision of the credit union.
For example, the superintendent of credit unions _ only a part-time role at the time _ had been directed by the Justice Department to focus on other priorities. Also, the regulatory body at the time, the New Brunswick Credit Union Federation Stabilization Board, had inadequate powers to act once it became aware of the institution’s problems.
If government had taken action sooner, “the total loss to New Brunswick taxpayers would probably have been about half what it eventually was,” Ferguson states.
Premier Shawn Graham said the massive losses could have been avoided had the Conservatives not “avoided the issue.”
However, Tory Leader David Alward said problems at the credit union date back to the 1980s and have continued throughout successive governments.
The auditor general’s report, which examines “irregular activities” at the Shippagan, N.B., bank from 1998 to 2004, was submitted Tuesday to the legislature’s standing committee on Crown corporations. It includes six recommendations to ensure the current regulatory regime is robust.
The recommendations include ensuring the auditors of credit unions have the skills and experience necessary; enforcing term limits for members of the governing bodies of Crown corporations; and ensuring the government’s regulatory and supervisory bodies have the power and resources to do their job.
A copy of the report has been given to the RCMP, Ferguson told the committee.The investigation of the credit union brought in KPMG Forensic, a division of the financial services firm that specializes in white-collar crime, to perform field work.
KPMG noted “in general an adversarial tone to the correspondence coming from” the credit union, and management showed “contempt for the regulatory process,” Ferguson’s report states.
The KPMG report reveals that management at the credit union covered up financial problems to make the institution look profitable.
“Because the organization appeared to be doing well, one or more members of the senior management group were being paid large salaries and collecting large dividends,” Ferguson said.
For example, in 2003 the credit union reported a surplus of $700,000 but an adjusted net income reveals losses of more than $9 million. The equity to asset ratio would have been 1.3 per cent _ below the level required for a credit union in New Brunswick.
In addition, large bonuses were approved and paid to select credit union employees annually, even though annual evaluations did not exist and there were no criteria to establish bonuses, the report states.
The credit union, located in a town with fewer than 3,000 people in the Acadian Peninsula, started to compete with bigger banks in 2001.
The financial institution began offering high-risk financial products, such as high-interest loans, despite its inexperience with such products, Ferguson said.
KPMG learned that the credit union routinely made changes to loan files, a practice referred to as a “flush” process, so that toxic loans would not appear on delinquency reports.
“You can look at what’s happened over the last year in the whole financial world and you can draw some comparisons,” Ferguson said to reporters Tuesday. “A lot of what happened at the Caisse Populaire de Shippagan is pretty much in common with what you see in some reports on what’s happened in the U.S.”
New Brunswick taxpayers have already given the institution a $37-million grant and could be on the hook for another $16.5 in guarantees to stabilize the credit union.
“The fallout from this problem is still going on,” Ferguson states in his report, pointing to its $1.4-million price tag.
Credit Unions
On 1 January 2020 a new Credit Unions Act came into effect.
The modernized Credit Unions Act restructures the regulatory framework and streamlines responsibilities, eliminates duplication and reduces the regulatory burden and costs to credit unions. FCNB is now responsible for the front-line regulation of credit unions. The former stabilization fund and the former deposit insurance fund are now combined into a single deposit protection fund that is administered by the New Brunswick Credit Union Deposit Insurance Corporation. The amount of deposit insurance remains unchanged at $250,000 per eligible deposit.
The Financial Institutions Division provides corporate registry services for credit unions and oversees the financial stability and solvency of credit unions for the protection of depositors.
New Brunswick - Incorporated Credit Unions
Region 1 – District of Fredericton
- Brunswick Credit Union Limited
- New Brunswick Teachers Association Credit Union Limited
- OMISTA Credit Union Ltd.
Region 2 - District of Saint John
- Brunswick Credit Union Limited
Region 3 – District of Moncton
- Brunswick Credit Union Limited
- OMISTA Credit Union Ltd.
Region 4 – District of Miramichi
- Beaubear Credit Union Ltd.
- Blackville Credit Union Ltd.
Region 5 – District of Bathurst
Region 6 – District of Campbellton
- The Credit Union Ltd.
Note that this list is for user convenience only and is not the official list.
To verify the status of a credit union included on this list, please contact 1 866-933-2222or email: info@fcnb.ca.
How to incorporate a credit union
The Credit Unions Act of New Brunswick regulates the incorporation of credit unions in the province.
To incorporate a credit union, 10 or more applicants, who are of the age of majority, may make an application to the Superintendent and upon approval of the Lieutenant-Governor in Council, a certificate of incorporation will be issued. The application is made using Form 1. It includes a signed declaration that, to the best of their knowledge, each director named is qualified to be a director and that the proposed name is not in violation of the Act.
The applicants will have to conduct a name search and provide a NUANS report to ensure the name under which the incorporation is sought is not similar to that of another business. Applicants should check with the Commission’s Financial Institutions Division to verify that the proposed name is acceptable to the Superintendent of Credit Unions. This approval must be done prior to making any investment in the name (i.e., logo, brand, website, etc.).
Applicants are required to provide by-laws to address matters that are applicable but are not set out in the articles of incorporation, such as:
- qualifications for, conditions of and method of applying for and terminating membership in the credit union;
- location of meetings, procedures and quorum, rights in relation to voting and the making, repealing or amending of by-laws, right of members to vote by ballot, mail, telephone or other communication facilities and the manner, form and effect of voting;
- election, term of office, removal of and filling of vacancies among directors, committee members and officers, their powers, duties and remuneration, and the procedure and quorum at meetings of the board of directors;
- the division of the territory into districts for the purpose of holding district meetings during annual or other meetings of members, the business that may be conducted and procedures to be followed.
Applicants also have to submit with their application:
- a declaration, that subject to the Act and regulations, the purpose of the credit union is to provide a comprehensive range of financial services that meet the needs of its members and that it shall operate on a co-operative basis and in accordance with generally accepted co-operative principles;
- a declaration that they are qualified to establish and the proposed directors are qualified to establish and operate the proposed credit union;
- a statement indicating that the credit union will become a member of Atlantic Central;
- a written opinion from the Atlantic Central indicating that the proposed credit union will be established and operated in a manner whereby the investments and deposits of the members will be safeguarded;
- a written statement that the proposed credit union will maintain such types and minimum levels of insurance and bonding as required by the Superintendent of credit unions;
- a business plan indicating the proposed credit union's strategic planning, marketing, human resources, operation, finance and accounting policies and procedures.
- a five year pro forma financial projection.
- written confirmation that the proposed credit union will have a minimum of $500,000 of regulatory capital as of the date of incorporation or any greater amount the Superintendent requires after incorporation as a credit union; and any other information the Superintendent may require.
The Commission will ensure the documents are in conformity with the Credit Unions Act.
Before it starts operations, the credit union has to provide to the Superintendent:
- a copy of the proposed credit union's loan policy;
- a copy of the proposed credit union's investment policy, including the terms, conditions, restrictions and limitations;
- a copy of the proposed liquidity management plan;
- a copy of the proposed capital management plan;
- copies of the proposed monitoring reports specifying the content, frequency and forms to be submitted to the Superintendent of credit unions; and
- written confirmation that the credit union is a bona fide member of Atlantic Central.
A credit union must, each year after its annual meeting, send its annual return and audited financial statements to the Superintendent.
New Brunswick Credit Union Deposit Insurance Corporation
The New Brunswick Credit Union Deposit Insurance Corporation is a Crown corporation that provides deposit insurance to members of New Brunswick's credit unions.
Fees
There is no fee for the incorporation of a credit union or for an amendment to a by-law or the articles. The credit union is charged an annual assessment to cover the costs and expenses in relation to the administration of the Act and regulations.
Contact
Saint John Office Location:
85 Charlotte Street, Suite 300
Saint John, NB E2L 2J2
Canada
Communications and Public Affairs
Media Inquiries: Media@FCNB.ca
Securities
For registration inquiries:
registration-inscription@fcnb.ca
For exempt market distribution inquiries:
EMF-MD@fcnb.ca
For corporate finance related inquiries:
passport-passeport@fcnb.ca
Consumer Affairs
For mortgage licensing inquiries:
mortgage.licensing@fcnb.ca
For consumer affairs licensing inquiries:
consumer.licensing@fcnb.ca
Fredericton Office Location:
225 King Street, Suite 200
Fredericton, NB E3B 1E1
Canada
Insurance
For insurance licensing inquiries:
insurance.licensing@fcnb.ca
For insurance compliance inquiries:
insurance.compliance@fcnb.ca
Pensions
For financial advisor inquiries on unlocking:
LIFrequest-demandeFRV@fcnb.ca
For standard contracts:
standardcontracts-contrattypes@fcnb.ca
For all other inquiries:
info@fcnb.ca
The Institute of Public Administration of Canada
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416-924-8787
Our Principles and Values
Our Institute is committed to practice and promote the highest standards of service for ourselves, our members and our government partners. Our principles and values help to ensure high levels of accountability, neutrality, confidentiality and protection from conflicts of interest, discrimination and harassment. They help to guide all actions of the Institute including those of our staff, Board of Directors and regional groups across the country. We also encourage their use by others in Canada’s public sector.
National Secretary-Treasurer, Chair, Finance & Risk Assessment Committee & Audit Committee
Rick Hancox
Chief Executive Officer, Financial and Consumer Services Commission
Bio
Now retired, Rick was the former Chief Executive Officer of the Financial and Consumer Services Commission (FCNB). Rick was accountable for the overall operation of the Commission including management of staff and administration of a wide range of consumer and investor protection legislation. The Commission was established on 1 July 2013 and is responsible for the regulation of securities, pensions, insurance, financial institutions and consumer affairs. Rick was the Executive Director of the former New Brunswick Securities Commission from 2004 - 2013.Rick has been a regulator for over 25 years. Prior to joining the Commission, he was the head of a number of different departments in another Crown Corporation for thirteen years. Rick is a former naval officer and is a Member of the Ancient Order of the Deep. He then worked in the defence industry before making the transition to Crown corporations. Rick now serves on a nu
I see that Dominic Leblanc's and Catherine Blewett's new minions in the DFO are curious N'esy Pas PM Trudeau "The Younger"?Inbox |
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