WASHINGTON— Military credit unions are the best line of defense against predatory lenders located outside military bases, the Defense Credit Union Council (DCUC) and CUNA told the House Subcommittee on National Security.
In a letter signed by DCUC President and CEO Anthony Hernandez and CUNA President and CEO Jim Nussle, the two organizations stressed the protections credit unions provide are more critical today as servicemembers’ budgets are being challenged by soaring inflation and rising interest rates.
“While the DoD is currently spending taxpayer dollars to train and hire in-house financial advisors, it simply is not the same quality they already get for free,” the letter states. “Plus, there is an important trust factor to consider. Survey after survey reveal that servicemembers are less likely to share personal financial data with someone in or associated with the chain of command. If a military member has mismanaged their finances, find themselves in a troublesome situation, or cannot make ends meet; the last person they want to tell is their boss, commander, or government contractor.”
Problems Go ‘Unmasked’
The letter further suggests that as a result problems go “unmasked” and “financial wellness fails to improve. Thus, credit unions offer a natural, and safe alternative and provide this service for free. Defense credit unions are also the first line of defense against many unscrupulous and predatory actors located off the installation.
“In accordance with their operating agreements, defense credit unions are not only regulated by federal and state examiners, but they are also subject to DoD regulations,” the letter continues. “As such, protecting each member is a role defense credit unions take very seriously and one they take pride as part of maintaining our nation’s military readiness.”
According to the DCUC/CUNA letter, there is more pressure on military families due to inflation, rising interest rates, and supply chain disruptions.
‘Stress on Families’
“The stress on military families is especially challenging as servicemembers struggle to live on a tighter budget,” the letter goes on to say. “Now, more than ever, is the time to guard against all kinds of fraudulent schemes, charities, and organizations that fail to deliver on any promise and cripple our nation’s defense. We hope the committee will recognize the role of defense credit unions have in educating servicemembers and veterans about these risks, particularly as the number of scams targeting the military community continues to grow.”