SACRAMENTO, Calif. — Longtime credit union leader John Tippets is questioning whether SAFE Credit Union’s proposed merger with Boeing Employees Credit Union (BECU) serves members’ interests and reflects the cooperative’s founding purpose.
The CU Daily has reporting on the proposed merger here.
In an opinion piece published in the Gold Mountain News, Tippets urged greater transparency about the proposal’s effects on members, employees and the Sacramento community, including disclosure of any financial benefits for insiders.
“It stunned me to learn of plans by the SAFE Credit Union Board of Directors and its executive leadership to eliminate this regional institution by allowing it to be acquired and merged into Boeing Employees Credit Union,” Tippets wrote.
Tippets praised SAFE’s history of serving local member-owners, describing it as an institution that has fulfilled the credit union mission for generations. He questioned the decision to merge into BECU, which he characterized as having no ties to Sacramento.
Calls For Member Engagement
Tippets said SAFE members should have an opportunity to understand the proposal’s advantages and disadvantages, expected operational changes, and financial and service implications for themselves and their community.
He also raised questions about employee participation and potential benefits for those involved in the transaction.
“Will employees be encouraged to share their thoughts or will they be urged to just acquiesce? Will members be engaged directly? Will insiders’ ‘generous’ benefits be fully disclosed and justified?” he wrote.
As the CU Daily reported here, the merger proposal includes nearly $15 million in payouts to five members of SAFE CU’s management.
Leadership And Stewardship
Tippets framed his criticism around the responsibilities of leaders to act honestly, openly and as stewards of their organizations. Those responsibilities include protecting an institution’s reputation, products, employees and assets, he wrote.
He argued that credit unions’ status as tax-exempt, not-for-profit cooperatives carries a responsibility to serve members and communities.
Although Tippets wrote that the SAFE merger process meets minimum legal and regulatory requirements, he said compliance does not resolve the broader question of whether the proposed outcome is consistent with the institution’s mission.
“The essential question is whether the likely outcome is morally and ethically correct and consistent with the principles and purposes for which SAFE Credit Union was created and currently exists,” he wrote.
Career in Credit Unions
Tippets served as CEO of American Airlines Federal Credit Union for 17 years and North Island Credit Union in San Diego for three years, according to the biography accompanying the piece. He also spent more than 20 years in a for-profit environment and has more recently consulted and spoken on leadership and strategy.
Tippets isn’t alone in questioning the merger, as the CU Daily has reported here. SAFE CU’s CEO has defended the combination, as is reported here.
One Response
There is much ‘Lipstick on the Pig’ to get past, but SAFE members) should think re the impact of the proposed merger on themselves and their families, on others ( members and employees) and on their community. Then,
from your heart and soul, you can decide how you want to vote.