Interestingly, Vrigian said Alloya members were not told the accounts were closed due to the inability of the banks to effectively comply with the Bank Secrecy Act or anti money laundering rules, as credit unions in Ohio and West Virginia were told.

“In a couple of cases, the bank specifically said the account was not profitable,” he said. “They have given multiple reasons, but none specifically cited BSA or MLA.”

Finding a new vendor is difficult enough, but Vrigian said oftentimes the banks don't give their credit union customers more than a few weeks' or a month's notice to find new correspondent services providers. When credit unions choose to switch the affected services over to Alloya, Vrigian said the corporate finds way to expedite the normal process to avoid service interruption to members.

As reported by the $1.4 billion Volunteer Corporate Credit Union and the $3.7 billion Corporate One FCU, some affected Alloya members have chosen to move their services to the corporate, while others have preferred a local bank or large credit union in their market to provide the necessary services.

“There really is a difference between working within the cooperative system and working outside it,” Vrigian said. “I can't ever recall hearing of a corporate telling a credit union they have just days to make changes.”