MADISON, Wis. – If credit unions hear nothing else about the timely discussions taking place on deferred compensation plans and executive benefits, they should take heed to three red flags. Joe Tripalin, CUNA Mutual Group vice president, executive benefits suggested credit unions pay close attention to the following: *If a provider tells a credit union it can set aside a program for an executive that will also allow it to make money for the credit union, "use great caution." In accordance with NCUA rules, credit unions can use variable investments to fund benefits only but they can not be used as a means to earn money for the credit union. *Some plans are being funded with insurance so that credit unions recoup their money at the death of an executive. The plans may be in effect for 30-35 years. "That's way too risky," Tripalin said. Federal examiners have not reacted to a program like this but they "may say it's imprudent." *Executives can take loans against their life insurance after they retire and they won't have to pay taxes on potentially large sums of money. "It sounds good but it's very risky and very difficult to keep these programs in place over a long period of time," Tripalin said. "If too much money is taken out, the whole policy will collapse, the credit union will not get their money back and the executive will have to pay taxes on all money taken out." [email protected]