March 7, 2016
Feds Shutter NEA Employees Credit Union. The National Credit Union Administration closed down the Education Associations Federal Credit Union (EAFCU), a credit union serving employees of NEA and its affiliates, after determining it was “insolvent and had no prospect for restoring viable operations.”
Established in 1954, the credit union was not owned or operated by NEA, but it was headquartered in the NEA building in Washington DC, was run by former NEA employees, had an NEA e-mail address, and served 665 NEA and affiliate employees, retirees and their families. Financial disclosure reports indicate NEA performed some business services for EAFCU, routinely receiving a total of $50,000 to $70,000 in cost recoveries from affiliates after disbursing similar amounts to EAFCU under the category “general overhead.” On average, NEA received $3,000 to $7,000 more than it paid out each year.
EAFCU has struggled for a number of years, first falling into the red in 2013. Nevertheless, EAFCU treasurer and former NEA employee Tomas Saucedo still tried to encourage NEA retirees to utilize the credit union. “EAFCU works for you – in a personal way that has your interest at heart – unlike other well known financial institutions of recent infamy. Stay with EAFCU. It’s a good thing.”
EAFCU’s financial situation deteriorated further, forcing it to seek a merger with larger credit unions. Unfortunately, preliminary talks with Educational Systems Federal Credit Union and the National Geographic Society’s credit union did not bear fruit.
It could not provide the basic services consumers expect these days, and the NCUA decided things were not going to get better. Just like banks, deposits in credit unions are insured by the federal government up to $250,000. Each EAFCU depositor will be made whole. EAFCU received a first-hand education about the failure of financial institutions, and taxpayers will help fund the lesson.
Recent Intercepts. EIA’s daily blog, Intercepts, covered these topics March 1-7:
* “The worst abuse of dues dollars imaginable.” Is the California Teachers Association really using private eyes to investigate its own employees?
* Cracking the Zip Code. Cognitive linguistic analysis unleashed!
* Kansas NEA’s Finances. Low membership, but low expenses.
* Kentucky Education Association’s Finances. Well ahead of its peers.
* Louisiana Association of Educators’ Finances. Boiled shrimp.
Quote of the Week #1. “I’ve had a very good relationship with both unions, with their leadership, and we’ve had really candid conversations, because we are going to have to take a look… You know what, I have told my friends at the top of both unions we’ve got to take a look at this, because it is one of the most common criticisms. We need to eliminate that criticism.” – Hillary Clinton, responding to the question “Do you think unions protect bad teachers?” (March 7 U.S. News & World Report)
Quote of the Week #2. “(Facebook), meet Theodore Olson, the epitome of a bad teacher. An example of a white supremacist teacher. Another indication that we need more teachers of color and more teachers who care about and will teach all kids. Its (sic) teachers like Theodore Olson who bring the reputation of the great teachers in our district down. If the (St. Paul Federation of Teachers) is protecting bad teachers like this one, who the is (sic) protecting our children???? We have to be the ones to protect our children, they are under attack from the SPFT.” – Rashad Turner of Black Lives Matter – St. Paul, claiming Facebook posts by teacher Theodore Olson about discipline problems in his classroom were racist. (March 7 Minnesota Public Radio)