Check Date - 12/29/15 Larger Payroll1 - OS PR1 Time Clock
Edit Paygrid
Add Change Request
100236 - Automation - D Wyatt - PFM 500 EE
Estimated Liability
Run Pre-Post Journal
Employees
$ 483 Employees Paid
Net Cash
$358,817.83
Employee Tax Liability
$122.632.76
11
Employer Tax Liability
$43,376.55
7
$524,827.14
12
Total Cash Requirement
Submit Payrun
Check Summary
482
Employee Checks
Employees Not Paid
1
Manual Checks
New Hires
0
Third Party Sick Pay
With Pay Related Changes
0
Voided Checks
Liability Summary
Cash Requirements
Net Cash
Employee Tax Liability
POC Checks
Employer Tax Liability
$6,297.39
Partial Direct Deposit
$50.09
Net Direct Deposit
$351,857.35
POC Manual/Void Checks
$461.28
Third Party Sick Payments E - Payables Total
Social Security - Employee
$33,290.69
Medicare - Employee
$7,785.92
Social Security - Employer
$67,262.34
Federal Unemployment
State Withholding
$14,175.20
State Unemployment
$0.00
Local Withholding
$118.61
$358,817.83
Total
$33,290.69
Medicare - Employer
Federal Income Tax
$151.72
$0.00
POC Payables
$7,785.92 $2,128.13 $171.81
Worker’s Compensation
$122,632.76
$0.00 Total
$43,376.55
Deductions Not Taken
Paygroup Totals - All Departments
Payroll. HR. Time. Onboarding. To help community banks enhance their portfolio of services, The Bankers’ Bank of Kentucky partners with Paycor to offer intuitive HR and payroll solutions customized to fit your clients’ business needs.
Payroll & Time
Human Resources
Onboarding
Additional Services
º Payroll & tax filing
º Employee handbooks
º Employee self-service
º Workers’ compensation
º Online check stubs
º HR best practices
º Compliance documentation
º Tax credit services
º Employee mobile access
º HR advice & guidance
º Upload company documents
º Custom reports
º Time management
º Employment screening
º Electronic acknowledgement
º Attendance tracking
º Benefits management
º Time clock devices
º Applicant tracking
For more information, contact The Bankers’ Bank of Kentucky:
Lynn Ellis, lellis@bbky.com David Fletcher, dfletcher@bbky.com Todd Beers, tbeers@bbky.com Shawn O’Keefe, sokeefe@bbky.com To learn more about Paycor, visit www.bbky.com/paycor
DECEMBER 2016 KBA STAFF
OFFICERS
Ballard W. Cassady Jr. President & CEO bcassady@kybanks.com
Chairman Mr. Michael H. Mercer First State Bank
Debra K. Stamper EVP & General Counsel dstamper@kybanks.com
Vice Chairman Mr. Timothy E. Barnes Hometown Bank of Corbin
Matthew E. Vance Chief Financial Officer mvance@kybanks.com
Treasurer Mr. David M. Bowling Citizens Union Bank of Shelbyville
Selina O. Parrish Director of Vendor Solutions sparrish@kybanks.com
Past Chairman Mr. Louis Prichard Kentucky Bank
Paula B. Cravens Sturgeon Director of Education Solutions pcravens@kybanks.com
BOARD OF DIRECTORS
Natalie Kaelin Incoming Director of Education nkaelin@kybanks.com Josh Fischer Director of Communications jfischer@kybanks.com Billie Wade Executive Director, HOPE of Kentucky bwade@kybanks.com Miriam Cole Executive Assistant mcole@kybanks.com John P. Cooper Legislative Solutions jcooper@kybanks.com Paula Cross Education Services Coordinator pcross@kybanks.com Jamie Hampton Education Services Coordinator jhampton@kybanks.com Janet Lewis Assistant General Counsel jlewis@kybanks.com Michelle Madison IT Manager mmadison@kybanks.com Tammy Nichols Convention Coordinator Finance Officer, HOPE of Kentucky tnichols@kybanks.com Katie Rajchel Staff Accountant krajchel@kybanks.com
Mr. Bill Allen Bank of the Bluegrass and Trust Co. Mr. W. Fred Brashear, II Hyden Citizens Bank Mr. J. Brent Bugg Fredonia Valley Bank Ms. Lanie W. Gardner First Southern National Bank Ms. Kari R. Gough Winchester National Bank Mr. Gordon Kidd United Cumberland Bank Mr. Dan H. Harbison The Farmers National Bank of Scottsville Mr. Michael Mineer Citizens Deposit Bank & Trust Mr. James A. Hillebrand Stock Yards Bank & Trust Company Mr. Dale Sights Field & Main Bank
»STRAIGHT»TALK».........................................6 MY TWO CENTS OF HOPE..................................8 PAULA CRAVENS-STURGEON............................9 STAFF PROFILES..................................................11 PAULA IN PICTURES...........................................21 CKFSB CELEBRATES 30 YEARS........................23 BANKERS ON THE MOVE..................................30 RISING RISK OF RANSOMWARE.....................33 2017 EDUCATION CALENDAR........................34 NIGHT BEFORE KBA CHRISTMAS...................35
Mr. Ryan Curtis Steger Town Square Bank Mr. John T. Taylor PBI Bank
Our Mission Statement Together We Make A Difference
Mr. Jed Weinberg Bank of Hindman
KBA INSURANCE SOLUTIONS KenBanc Insurance Services WE KNOW BANKS Chuck Maggard President & CEO cmaggard@kybanks.com
Steve Whitlow Systems Engineer swhitlow@kybanks.com
Lisa Mattingly Director of Sales & Service lmattingly@kybanks.com
Phone: 502-582-2453 Fax: 502-584-6390 Website: www.kybanks.com
DEAR SANTA TRUMP.............................................5
Mr. Lloyd C. Hillard, Jr. Farmers Capital Bank Corporation
Angie White Sponsorship Relations awhite@kybanks.com
Kentucky Bankers Association 600 West Main Street, Suite 400 Louisville, Kentucky 40202
CONTENTS
Brandon Maggard Account Representative bmaggard@kybanks.com
Our Commonwealth
One Voice Unifying Banking in Kentucky The KBA is a nonprofit trade association that has been providing legislative, legal, compliance and educational services to its member institutions since 1891. The KBA’s directors and staff work together with its members to make the financial services industry a more effective and successful place to work. The strength of the KBA is bankers unifying as an industry to speak as one voice.
The KBA does this in four ways: 1. Government relations & industry advocacy 2. Information interchange 3. Education 4. Products and services ADVERTISE/SPONSOR Call Angie White 502-736-1284 or email awhite@kybanks.com
Donna McCartin Benefit Support Specialist dmccartin@kybanks.com Audrey Whitaker Insurance Services Coordinator awhitaker@kybanks.com
The purpose of the Kentucky Bankers Association is to provide effective advocacy for the financial services industry both in Kentucky and on a national level; to serve as a reliable and responsive source of information and education about areas of interest to the industry; and to provide a catalyst and forum for collective industry action.
MAGAZINE
SUBMIT/SUBSCRIBE Call Josh Fischer 502-736-1283 or email jfischer@kybanks.com
Kentucky Banker Magazine (KBM) is the official monthly periodical of the Kentucky Bankers Association (KBA). No part of KBM may be reproduced without written permission from the KBA. The KBA is not responsible for opinions expressed by outside contributors of articles published in KBM.
When it comes to BOLI,
we are committed to Kentucky!
Lou Moore
MANAGING PRINCIPAL
We have been working with Kentucky community banks for
440.356.8860 PHONE
15 plus years and meaningful, long-term relationships remain
216.789.8889 MOBILE 440.730.3130 FAX
the foundation of our business. Banc Consulting Partners
lmoore@yourbankpartner.com
(BCP) is a national leader in the design, implementation, and administration of Bank-Owned Life Insurance (BOLI). We are endorsed by the Kentucky Bankers Association and have earned the trust of more Kentucky community banks than any firm in the country. So when you want the best for your BOLI portfolio and a firm that is dedicated to Kentucky community banks, talk to Lou Moore & Lon Haines at Banc Consulting Partners.
Lon P. Haines
MANAGING PRINCIPAL 267.773.7617 PHONE 856.577.7305 MOBILE lphaines@yourbankpartner.com
www.bancconsultingpartners.com
BCP_KY_ad052115.indd 1
5/21/15 11:12 AM
125
CHAIRMAN’S CORNER
An Open Letter to Santa Trump
As we say goodbye to another year filled with Dodd-Frank and CFPB oppression for our community banks, we
can finally see a ray of light for 2017. Whether you were for or against President-Elect Donald Trump, we all can feel the Dodd-Frank monster loosening its grip. Of course, it’s not a given that we will see relief, but we have hope. Being Christmas time I know you all are writing letters to Santa. I wanted to share with you one of mine.
Dear Santa Trump, I want to start by telling you I have been a very good banker this year. Compared to you, I have been a saint. With that in mind, I am sending you my wish list for this Christmas. Santa Obama didn’t even leave a lump of coal the past eight years, but it’s not his fault since he closed the coal mines, there’s not much coal to be found. I didn’t get squat so I figure you owe me a “HUGE” Christmas this year. To begin with, as a group, all my banker friends want to see the Tailor Act passed and want you to “build that wall” around those Wall Street banks. While you are working on legislative issues, please make sure your list includes exemptions from certain regulations if the loans are kept in our portfolio and please get that extra “A” taken out of UDAAP. That extra “A” is a pain. While we are in the retail spending season let’s start holding those retailers responsible for their part in credit card fraud and breaches. Just like the phrase your friends, the Clintons, coined, make them “pay to play.” Speaking of that, let’s work on those credit unions, start making them “pay” or let us “play” free, like they do. So, Santa Trump, you can see my banker’s list is long and full of hope, but I also have some individual gifts I wish you would consider. My friend, Wade Berry, would like an eighth day to his week so he can get one more round of golf. John Cooper, according to Ballard, needs more “yesterdays” for his golf game. Please give Debra Stamper a free pass to become a UK Wildcat. And for poor ol’ Tim Barnes, well let’s not waste your time there. But, definitely don’t forget our past chairman, Louis Prichard; we found out this year he cannot afford socks and if a man can’t buy socks, he probably is short on briefs, as well. So please, Santa Trump, bring him socks and throw in a 3-pack of tightywhities. Last, but not the least, please bring Paula Cravens a wonderful retirement full of joy and good health. We will miss her very much. It’s great to write you again. I took the past few years off, since I knew it wouldn’t do much good. We will do our part to help you in Kentucky. Our mines will dig as much coal as we can. That should give you enough coal to fill the naughty stockings you have on your list. I want to wish you, the KBA staff and all the bankers, and their families, throughout our great Commonwealth, a very Merry Christmas and Happy New Year. Your Friend, Mike Mercer Chairman, Kentucky Bankers Association Chairman, First State Bank
DECEMBER 2016 | KENTUCKY BANKER 5
»STRAIGHT»TALK»
125
From Dodd-Frank to the Punic Wars An Interview with Ballard and Marcia Cassady
“What didn’t you guys talk about?”
said Miriam Cole, KBA President & CEO Ballard Cassady’s longtime Executive Assistant, after helping transcribe the interview from which you are about to read. The topics ranged from DoddFrank, Kentucky basketball, Obamacare, Mike Tyson, pumpkin pie, the proper cream-to-coffee ratio and how servers always disturb that perfect mixture by topping off your cup. I knew about Ballard’s boxing gym on the West end of Louisville, his philanthropic attitude toward those young men and women, and I knew what he did for a living with the KBA. But I had no idea that Marcia was so accomplished. She is a mother of three, a lawyer, a teacher who started the Louisville Classical Academy (a successful classical school in Louisville), a lobbyist, sits on various boards and “flips” houses in her spare time. Here are some moments from a dynamic interview with Ballard and his wife Marcia. As it stands today, what will be one of your New Year’s Resolutions for 2017? BALLARD: I’m really looking forward to the changes that are coming. I think the tables have been set in Washington for a lot of positive change for banking and for business in general. I look forward to being involved in that, and I look forward to those battles. I hope there’s a lot of them. So my resolution is to relish the battles ahead. MARCIA: I care about those things. But, going into my 60th year, I’m also looking at time a little differently. My resolution is to simplify my life and to give more priority to people and things I love. What will your focus be in 2017? What are some of the “battles” ahead? BALLARD: Trump’s transition team is raising anticipation that Dodd-‐Frank is on the way out. I don’t know that you can do away with 4,000 pages of regulations in a blink, but I think you can go in and simplify, very quickly. I see a window where we can go in and repair the damage that Dodd-‐Frank has done. That’s going to require a really concentrated effort and a good strategic plan. It’s going to have to be done primarily through the appropriations process because the Republicans still don’t have 60 votes in the Senate, and that’s where the fight will come from. MARCIA: My government consulting focus is Frankfort rather than Washington. As of November 9th, Kentuckians are in a political landscape without modern precedent after joining the majority of other states in having “trifecta” government. So now the responsibility to achieve important things for Kentucky rests 6 KENTUCKY BANKER | DECEMBER 2016
squarely on GOP shoulders, and the stakes are high. As a parent, I wish this Governor, the new House leadership, and the returning Senate leadership, every success with any initiative that can change our state’s economic and population trajectory. BALLARD: Kentucky has an opportunity to get back into the conversation for location of corporate headquarters. Right now, we are not even in that conversation because we have a bad tax structure, we were all-‐in with Obamacare, our school systems lag behind, and you could go on and on. This is why we are losing out to other states for corporate headquarters. But again, the table is set for Kentucky to get back into that conversation. In the 3 decades since Ballard has been in a leadership position at the KBA, what have you seen happen inside the state? MARCIA: My closer look at state government began with our marriage, before Ballard took the job at the KBA in 1986. Ballard was the Banking Commissioner under Martha Lane Collins, who broke ground on the automobile hub that we’ve become. Since then, we haven’t evolved as successfully as our contiguous states have. I’ve heard plenty of theories about why, including a new one recently – that our 120 counties represent a more diffuse decision-making structure than in other states. For whatever reason, several states around us have adapted to the needs of employers in large business decisions more successfully than we did, with Indianapolis and Nashville being Exhibits A and B. It’s time for us to catch up so that Kentucky’s many natural advantages are not diluted by backward-looking tax and labor policies. BALLARD: That is right on the money. I would add to that, with the wisdom I’ve gained over the 30-40 years I’ve been watching politics, is that good management is invaluable. People don’t realize what a bad decision in government can do. Some people call it “kicking the can down the road” but it’s just a bad decision. Because of the amount of money you’re talking about and the number of lives being affected, bad decisions in government snowball rapidly and exponentially. Good management can turn dirt into gold; bad management can turn gold into dirt. Kentucky has had both gold and dirt over the years – enough of the latter for the bad management to put us behind. I think we’re at least pointed in the right direction now. As the interview progressed, the topic of conversation deepened. We discussed the state of education, John Locke, Leviathan, ancient civilizations, Kiwanis Clubs, and inevitably, I asked the Cassadys about time travel…
»STRAIGHT»TALK»
If you could reach back in history and take someone to address the world on every media outlet, who would that be? MARCIA: Plutarch of Chaeronea. He wrote this remarkable series of biographies about the so-‐called noble Greeks and Romans, pairing up one from each culture that he thought offered certain lessons – especially in contrast with each other. They’re full of accounts and anecdotes that give me better insights into contemporary actors and events on the world stage than I get from most of the current media pundits. BALLARD: You’d love to have somebody like Abraham Lincoln to come in and sit down and talk about division. He would say something like: “Let me explain to you what I saw when divisiveness almost ripped our country apart.” I’d like Knute Rockne to come speak too. We could use a little of his toughness. MARCIA: I’d also save some air time for Polybius. He was a young Greek aristocrat in the 2nd century BC who was held hostage by Rome in the household of the Scipio family, who had been the victors of Rome’s Punic Wars. Polybius brought an elite Greek education to his ringside seat on a key moment in Rome’s history, and he later wrote a history of Rome that included an analysis of its constitution when it was still truly a Republic. He included classical Greek political thought about a great cycle in forms of government – how and why a form of government comes into being …how and why it transitions into another form. I’d love his thoughts on where America may be in that great cycle, on how our path is consistent with historical precedents and also how it is not.
Finally, what makes you both such a good team? BALLARD: Well, she’s beautiful to begin with, and very smart as well as intelligent, obviously. I could spend an hour telling you how we met and what I had to do to get her to marry me. I fell hard for her, and she’s still my best buddy. We rarely argue, but conversation can get pretty intense. When our kids were little and we were making lots of long car trips, they recall us having these discussions about the lessons of our childhoods and current events and history and philosophy that lasted as long as the trip. You could throw any topic out, and she would take one side and I would play devil’s advocate or vice versa. Our kids learned early that if you’re going to say something in this house, you better be prepared to defend it! MARCIA: In all that conversation, I’ve learned such respect for the man I married, for our individual differences. I have never faced warfare. I have never set foot on a field of sport – except carrying a flute at halftime. I have never been in a boxing ring, a few lobbying experiences notwithstanding. And I have never had the fate of many riding on my ability to manage conflict and win. That’s what he brings to our ‘team’, and it’s a perspective I value. He was raised by two extraordinary parents to use strength judiciously, to be reasonable, to be a warrior if necessary, to protect those in his charge. He’s a man, who finds nothing in that to apologize for. I’ve been glad for our children – our sons and our daughter – to have all that in a father.
DECEMBER 2016 | KENTUCKY BANKER 7
MY TWO CENTS & THEN SOME
T
125
Hopey Holidays
his is our December issue and I hope to keep my article somewhat light, in accordance with the season. As each year draws to a close, we are filled with optimism and hope. I want to use this article to express some of my hopes: I hope Paula Cravens Sturgeon is fully prepared to enjoy her retirement. I hope that she understands how much she will be missed and is ready for lots of visits, even after she clocks out on December 24. I hope that she finds plenty of fulfilling work to keep her busy and happy. I hope that Steve continues to bring her breakfast every morning. I know that Paula will fill this next stage in life with passionate interests. I hope that each of my banker friends, their families and their friends find peace and happiness in the coming year. The world becomes ever more complex and so many people (especially our young and our elderly) find it difficult to navigate, whether professionally or personally. I hope we can all be there to assist when needed and that we have one another to reach out to for assistance we need.
Right now, we have a system which places the full brunt of liability on the issuing bank, with very limited protection for banks even when the loss occurred because of action or inaction of others. So, if a retailer uses a vendor, which hacks into the retailer’s computer system and uploads customer payment information, the bank pays for the consumer losses. If a consumer pays online through an online payment service that is linked to the consumer’s card account and that online provider is hacked, the bank pays for the consumer losses. If a consumer gets gas and a skimmer is on the pump and the consumer’s information is captured, the bank pays for the loss. If a consumer goes to a festival and uses a card to pay for cotton candy and the vendor writes the information down and uses it later, the bank pays for the loss. If a consumer writes their PIN number on their debit card and leaves it in the dashboard of their unlocked car and a thief takes it and cleans out their bank account, the bank pays for the loss. The bank is left holding the full liability and must affirmatively reinforce its willingness to do so, by agreeing to the terms of VISA and MC’s rules. The system is broken and it is resulting in lack of personal and even corporate responsibility.
I hope that our leaders have the foresight, thoughtfulness and resources to make decisions that keep our country safe and prosperous both at home and abroad. I hope that they I hope this changes and I hope that 2017 will see more subcan pave the way for the country to heal and unify after stantive articles from me with insight on how to make your job easier. such a destructive campaign season. I hope that Kentucky continues to find, elect and support strong leaders, especially as many of our current elected officials begin to retire from public service. More public servants, like Congressmen Andy Barr, are what our state needs. I hope that intelligent, enthusiastic leaders will come forward and agree to place themselves in elections for public service, even when realizing it is a thankless enterprise. I hope that Congress gets things done. Legislation is needed to help our banks; our communities; our states; and, our country thrive. Congress needs to lead the way by passing thoughtful legislation necessary to these goals. One such piece of thoughtful legislation that I cannot keep from harping on is debit/credit card fraud and data breach liability. Unless and until we have a statutory system that holds all responsible parties liable for their involvement in these losses will we be able to develop payment systems that are real time and that keep up with technology and change. 8 KENTUCKY BANKER | DECEMBER 2016
Debra Stamper EVP & General Counsel dstamper@kybanks.com
HAPPY HOLIDAYS
KENTUCKY BANKER
125
Paula Cravens-Sturgeon Retires “I want to thank you all for all the fond memories.”
W
hen Paula Cravens-Sturgeon retires at the end of this year it will mark three decades of service to the members of the Kentucky Bankers Association (KBA) and 4 decades of service in the banking industry overall. She joined the KBA in January of 1987 as the first Executive Director of the Louisville Chapter of American Institute of Banking. Since then she has become the face of KBA Education and she has established a track record of excellence with her leadership that will certainly insure a continuation of the same. Paula came to the KBA with banking experience: “I started in banking August of 1974 as a loan services clerk, and left as an assistant cashier and compliance officer in the mortgage division at the end of 1986,” she said. “I volunteered for overtime in numerous other departments which gave me exposure to all facets of retail banking operations.” She brought that multi-faceted experience to the KBA where she eventually took the role of Director of Education in 1996. From there the KBA merged with AIB, KBA seminars, and KBA schools into one division.
• Bankruptcy was such an embarrassment, no one talked about it; if you filed for it, you kept it a secret. • Banks issued either an Interbank/Master Charge (now Master Card) or BankAmericard (now Visa). • Merchant credit card machines were a heavy, ugly, metal machine with an embossed plate on it; swiping a credit card took a little muscle. • Bank routing numbers were developed by American Bankers Association. • Bank records were on microfiche and mainframes. • Regulations did not change very often. “I remember, at one time, when a negotiable CD for $100,000 invested for 14 days paid 15%, or home mortgage rates were 15%,” Paula said. “And when banks started to merge, it was baffling to us. ‘What? Merge two banks together? And across state lines?’ Times they do a’ change, and now today’s banking doesn’t really look anything like the banking of 70s or 80s, or even 90s.” “Paula provided the direction needed in banker education to ensure that Kentucky bankers had available all of the tools and resources needed for navigating changing times. Paula has been and, I am sure, will continue to be a friend to the banking community and to each of us individually,” said Debra Stamper, KBA EVP and General Counsel.
After being in the banking industry for 42 years, Paula has had a front row seat to the ups and downs Kentucky bank“Paula has set us on a road toward excellence in education ers have experienced. She believes banking has received for our bankers across the Commonwealth,” said Ballard criticism it doesn’t deserve: “The media has it all wrong. I’ve Cassady, KBA CEO and President. grown up my whole adult life in banking. Some of the best, brightest, nicest, kindest, most honest folks, are bankers,” Paula retires as the KBA’s Director of Education Solutions. said Paula. “I’ve had the pleasure to know hundreds of KenIn her 30 years at the KBA, and her 12 years in banking tucky bankers. I’m very grateful for what they have taught before that, she has seen numerous changes in the financial me.” industry. Cravens reflected nostalgically about… “(Paula) will be missed, but remembered. We wish her the • A passbook savings account paid 4% interest and there best in her retirement,” said Mr. Cassady. really was a passbook that got stamped every time you made a deposit. • Personal loans were extremely unusual and so were credit cards; banks, NOT car dealers, made car loans; and no bank would ever lease a car to an individual.
“No amount of my hard work could ever give back to banking what it’s given me,” said Paula. It’s been my pleasure and honor to serve, and get to know, Kentucky bankers and associates throughout the past 30 years at the KBA. I want to thank you all for all the fond memories.” DECEMBER 2016 | KENTUCKY BANKER 9
KENTUCKY BANKER
125
KBA Co-Workers Reflect on their Friend and Colleague, Paula Cravens-Sturgeon ANGIE WHITE Sponsorship Relations I’ve only been with the KBA for 4 years but Paula has been a saving grace for me! Her wealth of knowledge is something that amazes me. She is a special person who has a way with people to make them feel welcome and appreciated. I wish Paula nothing but the best in her retirement! AUDREY WHITAKER Insurance Services Coordinator Paula’s commitment to the KBA and our membership is second to none. Her life’s work made a difference; she will be missed. Enjoy a well-deserved retirement! BALLARD CASSADY President & CEO Paula took over the KBA education area at a time when we needed to move from face to face only education to a more technology based delivery system due to time constraints for employees to be able to be out of the bank for extended periods of time. This would have been a daunting task for anyone but Paula, with that easy going demeanor of hers, made it look really easy. BILLIE WADE Executive Director, HOPE of Kentucky Paula is one of the most dedicated employees I have been around in my 45 year career. She is always thinking about ways to make the KBA better. Paula is always concerned about improving our bank members education and knowledge and especially the employees. She loves to see students’ progress through the banking schools. Paula is great as a fellow employee. She always is interested in us and our families. My wife loved Paula. BRANDON MAGGARD Account Representative, KenBanc Insurance Services When I first came to work for the KBA, everyone was so nice and welcoming. But Paula always seemed to be the most positive and uplifting person around and has continued that in my time here at the KBA. CHUCK MAGGARD President & CEO, KenBanc Insurance Services It’s no secret how great of an individual Paula is. What some may not know is that she is one of the hardest working, most prepared, person I’ve ever worked with. Paula, I wish you the very best in your well-deserved retirement. You will be greatly missed.
10 KENTUCKY BANKER | DECEMBER 2016
DEBRA STAMPER EVP & General Counsel I love Paula. She and I have become very close over the years. She has that impact on people, as I am sure the bankers will agree. DONNA McCARTIN Benefit Support Specialist Paula and I graduated from high school together. Fast forward 41 years - it was no surprise to be hired at KBA in 2013 and see this highly, successful business woman, hard at work, leading the Education Department. Those outstanding qualities in high school had followed her throughout the years! She is such a wonderful representative of this company! KBA will miss her immensely! JAMIE HAMPTON Education Services Coordinator I’ve had the pleasure of working with Paula for 23 years, I’ve never met a more dedicated, loyal, hard-working person. She will be greatly missed. I wish her many blessings. JANET LEWIS Assistant General Counsel Though I have not been with the KBA for long, within the first hour of my arrival to the office I vividly recall Paula coming in, with her cute sandals, physically embracing me, and exclaiming, “Welcome to the team!” She has been as kind and friendly toward me since that day. While she may be leaving the KBA, her impression, years of hard work, and dedication will continue to leave a lasting impression on all of us. JOSH FISCHER Director of Communications Paula has modeled for me what it takes to take many moving parts and put them into a working whole. She has also never ceased to provide me guidance and support. It means a lot. KATIE RAJCHEL Staff Accountant Paula, thank you so much for your service not only to our bankers but to us as employees. You have gone above and beyond to make us each feel special and always brighten our day! I’m thankful I will still get to see you on Sundays!
REFLECTIONS CONTINUE ON PAGE 20 PAULA IN PICTURES THROUGH THE YEARS PAGE 21
125
STAFF PROFILES
Ballard Cassady WITH THE KBA SINCE 1986
President & CEO
Favorite quote: “Be still and know that God is with you.” Favorite toy as a child: canoe You have $5,000 to go shopping, where would you go? Wal-Mart and get “stuff” for my kids down at the boxing gym What movie title fits your life? Hillbilly If you can go back in time, where would you go? November 22 1963 Dallas, Texas, To find out what the absolutely true story was on the assassination of JFK.
Selina Parrish
WITH THE KBA SINCE 1990 Director of Membership & Vendor Solutions Favorite quote: “It is not fair to ask of others what you are not willing to do yourself.” by Eleanor Roosevelt Favorite toy as a child: Barbie was my favorite! $5,000 shopping spree at one store: where would you go and what would you buy? Watch out Macy’s here I come! Suits, heels, and accessories! What movie title fits your life? Little Women If you can go back in time, where would you go? January 1, 2003 - the day Jenna Louise Welch came into this world! What an amazing day!
DECEMBER 2016 | KENTUCKY BANKER 11
KBA STAFF PROFILES Michelle Madison
WITH THE KBA SINCE 1991
IT Manager
Favorite quote: “You become what you think about all day long” Ralph Emerson Favorite toy as a child: My bike $5,000 shopping spree at one store: where would you go and what would you buy? Grocery store to buy food of course! I love food! What movie title fits your life? Groundhog Day If you can go back in time, where would you go? Woodstock! So many monumental artists.
Audrey Whitaker
WITH THE KBA SINCE 1991 Insurance Services Coordinator
Favorite quote and who said it: “Leave this world a little better than you found it.” Robert Baden-Powell Favorite toy as a child: Drowsy Doll $5,000 shopping spree at one store: where would you go and what would you buy? Best Buy. Upgrade all of my appliances. What movie title fits your life? Groundhog Day If you can go back in time, where would you go? I wouldn’t go back in time. I would rather remember the past with fondness.
Jamie Hampton
WITH THE KBA SINCE 1994 Education Services Coordinator Favorite quote and who said it: “Life is a sum of all of your choices.” Albert Camus. Favorite toy as a child: My bicycle! It meant freedom to go wherever I wanted (as long as my mom and dad said it was ok). You have $5,000 to go shopping but can only go to one store, where would you go and what would you buy? The grocery store because I like to eat AND feed people. What movie title fits your life? Beaches If you can go back in time, where would you go? I’d go back to the beach. It’s my favorite place.
12 KENTUCKY BANKER | DECEMBER 2016
125
KBA STAFF PROFILES
Debra Stamper
WITH THE KBA SINCE 1996 Executive Vice President & General Counsel
Favorite quote and who said it: It’s not the mistake, your behavior after you realize that you made a mistake, which defines you. I don't know who said it. Favorite childhood toy: My stuffed bunny. I still have her, but she is a little worn out. You have $5,000 to go shopping at one store: I would go to Meijer and buy loads of gifts for Boys and Girls Haven. If I had to spend it on myself, I would use it to travel. If you can go back in time, where would you go? There isn’t really a time I would want to return to. I am pretty happy moving forward.
Steve Whitlow
WITH THE KBA SINCE 1998
Systems Endgineer
Favorite quote: “You can’t handle the truth!” Jack Nicholson Favorite toy as a child: The motorcycle I got for Christmas one year. You have $5,000 to go shopping but can only go to one store: I would go to Bass Pro Shop and buy “more guns.” What movie title fits your life? Not sure what one fits my life, but my favorite movie is Top Gun. If you can go back in time, where would you go? I would go back to St. Petersburg Florida because of the beach and be with my whole family.
Tammy Nichols
WITH THE KBA SINCE 1998 Convention Coordinator and Finance Officer for HOPE of KY Favorite quote: “I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.” Maya Angelou Favorite Toy: Homemade Play-Doh You have $5,000 to go shopping, where would you go? Furniture Store. I need new living room furniture. Choose a movie title for the story of your life: Parent Trap You have one day to go back in time, where would you go? Before my Grandpa died. I would record all of the stories that he would tell about his life. DECEMBER 2016 | KENTUCKY BANKER 13
KBA STAFF PROFILES Miriam Cole
WITH THE KBA SINCE 1999 Executive Assistant Favorite quote: “What we are is God’s gift to us. What we become is our gift to God” by Eleanor Powell Favorite toy as a child: Barbie You have $5,000 to go shopping but can only go to one store, where would you go? Amazon. The sky’s the limit! What movie title fits your life? It’s a Wonderful Life If you can go back in time, where would you go? 1776. I’d love to be in the room and hear the discussions of what our country was initially to be when they signed the Declaration.
Matt Vance
WITH THE KBA SINCE 2001 Chief Financial Officer Favorite quote: By Ralph Waldo Emerson: “To laugh often and much; To win the respect of intelligent people and the affection of children; To earn the appreciation of honest critics and endure the betrayal of false friends; To appreciate beauty, to find the best in others; To leave the world a bit better, whether by a healthy child, a garden patch, or a redeemed social condition; To know even one life has breathed easier because you have lived. This is to have succeeded.” Favorite toy: BB Gun, and no, I did not shoot my eye out! What movie title fits your life? Groundhog Day If you can go back in time, where would you go? December 12, 1980. The date of Apple’s IPO - for obvious reasons.
Chuck Maggard WITH THE KBA SINCE 2008 President & CEO, KenBanc Insurance
Favorite quote: “The only place success comes before work is in the dictionary.” Vince Lombardi Favorite toy as a child: G.I. Joe, Hot Wheels, and any type of ball (baseball, football, basketball, etc.). You have $5,000 to go shopping but can only go to one store, where would you go? Travelocity. I’d much rather spend it on experiences. If you can go back in time, where would you go? Christmas 1999; so I can spend time with loved ones that are no longer with us.
14 KENTUCKY BANKER | DECEMBER 2016
125
KBA STAFF PROFILES
125
Paula Cross
WITH THE KBA SINCE 2011 Education Services Coordinator
Favorite quote: “Every time a bell rings, an angel gets his wings” by ZuZu Bailey Favorite toy as a child: Easy Bake Oven You have $5,000 to go shopping, where would you go? Walmart. Groceries, clothes and everyday necessities for the family and those in need. What movie title fits your life? It’s a Wonderful Life If you can go back in time, where would you go? I’d go back to a year when all of my family was together on the holidays. All of the parents and grandparents would be with us again.
Natalie Kaelin
WITH THE KBA SINCE 2010
Director of Education
Favorite quote: “The future belongs to those who believe in the beauty of their dreams.” Eleanor Roosevelt Favorite toy as a child: My Cabbage Patch kid You have $5,000 to go shopping but can only go to one store, where would you go? I’d go to Target. You can buy so much there – groceries, toiletries, clothing, baby stuff, etc. If you can go back in time, where would you go? I would go back to before my grandfather passed away so that I could have one last conversation with him. I would love to hear him say he is proud of me and the life I have created. He was such a huge influence on my life.
Billie Wade
WITH THE KBA SINCE 2011 Executive Director, HOPE of Kentucky Favorite quote: “People don’t care how much you know until they know how much you care.” Teddy Roosevelt
You have $5,000 to go shopping but can only go to one store, where would you go? TJ Max. I would use it to buy coats and cloth for families residing in our low income housing communities that I am involved with either through HOPE financing or with the housing nonprofit organization I am involved with. Special emphasis would b on the refugee families that have little in possessions.
If you can go back in time, where would you go? I would go back the day Columbus discovered North America. I would like to witnes the excitement of the discovery of the new world.
DECEMBER 2016 | KENTUCKY BANKER 15
KBA STAFF PROFILES
125
Lisa Mattingly
WITH THE KBA SINCE 2012 Director of Sales & Service, KBA Benefit Solutions Favorite quote: “Nobody cares how much you know, until they know how much you care.” by Zig Ziglar If you can go back in time, where would you go? 1990. I would change so much. You have $5,000 to go shopping but can only go to one store, where would you go? A jewelry store to buy diamonds! Favorite toy as a child: Barbie dolls What movie title fits your life? Forgiven
Katie Rajchel
WITH THE KBA SINCE 2012
Staff Accountant
Favorite quote: “I can do all things through Christ who gives me strength.” Philippians 4:13 by The Apostle Paul Favorite toy as a child: Four-wheeler You have $5,000 to go shopping, where would you go? Walmart. They have everything! What movie title fits your life? I don’t know what one fits my life but my favorite one is How To Lose A Guy In 10 Days If you can go back in time, where would you go? October 15, 2011 my wedding day, it was a blast! I asked my mom if we could do it again and she said only if it was on my dime.I haven’t done it again.
Brandon Maggard
WITH THE KBA SINCE 2012
Account Representative
Favorite quote: “If it doesn’t matter who wins or loses, why do they keep score?” by Vince Lombardi Favorite toy as a child: Power Wheels You have $5,000 to go shopping but can only go to one store – where would you go and what would you buy? Golf Warehouse to buy an indoor golf simulator for my house What movie title fits your life? Even Flow If you can go back in time, where would you go? 1990 when the Reds won the World Series because it’s not looking like it’s going to happen again anytime soon. 16 KENTUCKY BANKER | DECEMBER 2016
125
KBA STAFF PROFILES
Angie White
WITH THE KBA SINCE 2013 Sponorship Relations Favorite quote: “If not you, who? If not now, when?” John F. Kennedy Favorite toy as a child: Strawberry Shortcake dolls You have $5,000 to go shopping but can only go to one store, where would you go? Macy’s. I would take my boys and my mom with me so we can all partake in spending the $5,000. What movie title fits your life? Love and Friendship. The title, to me, is two of the most important things you need in your life. If you can go back in time, where would you go? 1989 to spend more time with my grandma and grandpa.
Donna McCartin
WITH THE KBA SINCE 2013 Benefit Support Specialist Favorite quote: “God grant me the serenity to accept the things I cannot change, courage to change the things I can, and the wisdom to know the difference.” by Reinhold Niebuhr Favorite toy as a child: My Barbie dolls You have $5,000 to go shopping, where would you go? A salon for a day of relaxation, including a massage, manicure, pedicure, and anything else they want to throw in! What movie title fits your life? The Good, The Bad, and The Ugly If you can go back in time, where would you go? Jan. 28, 2010 to see my dad one more time. He passed away on this day.
Josh Fischer
WITH THE KBA SINCE 2015 Director of Communications
Favorite quote: “Heaven have mercy on us all - Presbyterians and Pagans alike - for we are all somehow dreadfully cracked about the head, and sadly need mending.” Ishmael Moby-Dick Favorite toy as a child: Stretch Armstrong and Tight Armweak You have $5,000 to go shopping where would you go? Quest Outdoors. I’d get all the top hiking gear, and GoPros for JFK. What movie title fits your life? Driving Miss Crazy If you can go back in time, where would you go? Dealey Plaza, Dallas, TX. November 22, 1963. Grassy knoll, with a dozen GoPros.
DECEMBER 2016 | KENTUCKY BANKER 17
PRODUCTS & SERVICES
ODM Guardian™ is an overdraft management system Some of the primary benefits of ODM Guardian™ include that detects and mitigates risk, while helping you better the following functions: manage your account holder communications. • Protect and sustain non-interest fee income streams Velocity Solutions is one of the only providers in the in• Identify and reduce risk to your account holders dustry to offer a solution that considers an individual’s ability to repay when determining the appropriate over- • Reduce waivers, refunds and charge-offs draft limit amount, an important consideration for both • Simplify and improve overdraft collections process revenue and compliance in the changing regulatory en- • Comply with Reg. E rules and regulatory guidelines vironment. • Improve account holder communications • Improve overdraft operational efficiencies ODM Guardian™ is tailored to the needs, resources and budgets of financial institutions with less than approxi- • Provide consistency in your practices mately 25,000 checking accounts. Velocity found that existing systems available to financial institutions became cost prohibitive and labor intensive for many communiFor more information ty-based banks. Velocity developed ODM Guardian™ speContact Selina Parrish cifically to give these financial institutions another option (502) 736-1282 to manage risk and compliance, without the costly implesparrish@kybanks.com mentation process that often comes with other solutions.
THE BANKERS’ VOICE
TESTIMONIAL PAGE 18 | KENTUCKY BANKER MAGAZINE
“
Central Bank participated in the Ohio Equity Fund for Housing XXVI that will strengthen and develop vibrant, sustainable and affordable communities with over 3,100 affordable housing units. In addition to the equity fund supporting nine projects in Kentucky, the investment will count toward our CRA goals. Creating new housing opportunities and spurring economic activity is a focus for Central Bank, and we are pleas ed to be involved with Ohio Capital Corporation for Housing and the equity fund. Luther Deaton, Chairman/President/CEO Central Bank & Trust Co., Lexington, KY
DECEMBER 2016
KBA STAFF PROFILES
125
Janet Lewis
WITH THE KBA SINCE 2016 Assistant General Counsel Favorite quote: “Anyone who’s just driven 90 yards against huge men trying to kill them has earned the right to do Jazz hands.” Craig Ferguson Favorite toy as a child: I’m a book geek. I did not play with toys nearly as much as I read. My favorite series was the Babysitters’ Club and Goosebumps. You have $5,000 to go shopping but can only go to one store, where would you go? I’m heading to Macy’s. About $3,997.78 will be spent on shoes. The other would be spent on clothes, some of which I would donate to a charity that helps provide clothing for children and the homeless. If you can go back in time, where would you go? Christmas 1967 the Good Family household. My mother would have been about 16 or 17 years old at that time; I would love to see her open her gifts alongside her siblings.
Marvin Grafchik
WITH THE KBA SINCE 2016 Strategic Consultant, HOPE of Kentucky Favorite quote: “Worry is advanced interest on things that seldom come true.” Favorite toy as a child: 10-speed bike You have $5,000 to go shopping where would you go? Rodes to buy new clothes. Been quite some time since I’ve refreshed my wardrobe. What movie title fits your life? Back to School If you can go back in time, where would you go? I’d go back and sit down with my grandfather, on the steps of his home, really understand the hurdles he dealt with in his journey to this country; ask, how to succeed in life, as he did.
KBA WITH THE KBA SINCE 1891 Members and Staff
Favorite quote: “United For Service” Favorite toy as a child: Ledger What movie title fits your life? Bank Shot
THANK YOU MEMBERS FOR MAKING OUR 125th YEAR CELEBRATION SO SPECIAL!!
KENTUCKY BANKER
125
continued: KBA Co-Workers Reflect on their Friend and Colleague, Paula Cravens-Sturgeon LISA MATTINGLY Director of Sales & Service, Benefit Solutions Paula took me under her wing and was such a great friend to me when I was first hired at the KBA. I could always count on Paula with any help, or guidance I needed in that first year. MATT VANCE Chief Financial Officer Paula is one of the most caring and devoted colleagues that I have ever had the pleasure to work with. Her contributions to the Association and by extension the Kentucky financial institution industry have been numerous - she will be missed. MICHELLE MADISON IT Manager Paula it has been a pleasure to work with you and get to know you over the years. It was very apparent that you were passionate about your work and educating bankers. Enjoy your retirement! MIRIAM COLE Executive Assistant Paula is a fantastic and resourceful woman. She taught me a great deal. For these things, and others, I am thankful to have had the opportunity to know and work with her. NATALIE KAELIN Incoming Director of Education The world of banking is losing a bright spot at the end of this year with the retirement of Paula Sturgeon Cravens. I have been
blessed to learn from her and be tasked with the responsibility to try to fill her shoes. I will miss Paula’s guidance, friendship and smile. Thank you, Paula, for everything you have done for myself, the KBA, and our bankers. PAULA CROSS Education Services Coordinator Paula is a very special person and wonderful to work for. SELINA PARRISH Director of Vendor Solutions What a blessing it has been to work with you over the years. Wishing you a bright future with the time to do the things you have always wanted to do. May your retirement lead to new success in whatever you pursue. STEVE WHITLOW Systems Engineer Paula has been wonderful to work with over my 18 years at the KBA. She has always had the KBA’s interest as a top priority in everything she does. One thing that goes “unseen” is that Paula has a huge heart and is willing to help anyone and everyone. TAMMY NICHOLS Convention Coordinator/Finance Officer, HOPE of Kentucky Paula has been a valuable asset to the KBA in too many ways to count. It has been a pleasure to work with and learn from you in my years with the KBA. Thank you for always having a positive attitude and best wishes for the future!
Regulations change, but our focus on banking and finance law doesn’t. That’s why banks hire Morgan & Pottinger. Known for banking and finance law. Experienced in much more. BANKING & FINANCE LAW cOMMERcIAL LItIGAtION EQuINE LAW GOvERNMENt LAW REAL EstAtE LAW
BOWLING GREEN
cORBIN
LExINGtON
LOuIsvILLE
John t. McGarvey
NEW ALBANY
MorganandPottinger.com
125
KENTUCKY BANKER
Paula in Pictures: Through the Years
DECEMBER 2016 | KENTUCKY BANKER 21
How do you like your I.T. —
...neat or on the rocks? LEXINGTON
|
LOUISVILLE
|
LITTLE ROCK
|
CINCINNATI
|
CHATTANOOGA
|
ST. LOUIS
|
BIRMINGHAM
What do Kentucky bankers think of bourbon? Some like it on the rocks. Some like it neat. Some don’t drink it at all. But all Kentucky bankers have one thing in common: They don’t like their I.T. on the rocks. When better matters, NetGain Technologies is your I.T. department.
The Kentucky Bankers Association endorses Technology OneSource managed IT services provided by NetGain Technologies.
To learn more about solutions for your organization, go to www.netgainit.com or call 844-77-SMART.
NG-16108 KBA_NeatRocks_FullPage_5_15.indd 1
We Are Your I.T. Department
5/13/16 11:37 AM
KENTUCKY BANKER
125
Central Kentucky Federal Savings Bank Celebrates 130 Years
Danville, KY — In 1885 a group of civic leaders recognized that the dream of home ownership in Boyle County was difficult to achieve. These leaders understood that affordable housing was imperative in order for Danville and Boyle County to prosper and grow. Through sheer perseverance and community support this group began to raise capital to organize a building and loan association. They were able to meet the stipulation that “the business could not begin operation until the sum of $5,000.00 was subscribed” and Central Kentucky Building and Loan Association was chartered on May 7, 1886. The association was organized to make it possible for local residents to build or purchase a home with a small down payment followed by weekly or monthly payments, thus encouraging home ownership in Boyle County. The first office of the financial institution was merely a desk in the lobby of the former Boyle Bank & Trust Company and was only open on Saturday evenings from 7-9pm at that time.
munity and during four decades has made only one foreclosure and lost only a little over $100.00”. With reserves at $44, 000.00 and loan applications totaling $41,000.00, the Association was seeking to sell additional stock with the assistance of the Chamber of Commerce in order to meet loan demand. The Association prevailed through the Great Depression and in 1940 The Kentucky Advocate newspaper declared: “Central Kentucky Building and Loan Association has played a conspicuous and useful part in building this splendid community” and further noted that “This Association has weathered every panic and depression and has steadily increased its Surplus as a bulwark for its investors and borrowers. During its whole history it has met every obligation the day it was due; 1939 was one of the most successful in its career.”
The Association, in response stated “We have no ambition to merely expand, but rather to be Safe and Sound. We have, however, kept pace with the growth of the community and have met every worthy need. Our ambition Their success was notable. By 1925 local papers announced is to help people to save and to provide themselves with that for “40 years the building and loan association has Homes.” rendered a great service to the homebuilders in our com-
ABOVE: 130 Celebration Promo Items AT LEFT: Memory Board
ABOVE: Kathy McBee, Central Kentucky Federal Savings Bank’s Business Development Officer Ridgefield Center Branch Manager organized the 130 Year Celebration DECEMBER 2016 | KENTUCKY BANKER 23
KENTUCKY BANKER
125
Troop 1780 Visits The Murray Bank The girls are working for their Financial Literacy patches!
Troop 1780 recently visited The Murray Bank to learn about how banks work, how to save money and why it is important to save money. The girls in Troop 1780 are working toward earning their Financial Literacy patches - money counts and making choices. They are also working on earning their Cookie Business patches- count it up and talk it up. To earn these patches the girls have to understand money and what it is worth (money counts), know how to make choices about using money (making choices), know how their cookie money adds up (count it up) and finally decide how to best use your cookie money (talk it up). While at the bank the girls learned about depositing money into an account, withdrawing money, saving money and deciding how to spend their money.
75 U.S.
85
th
+
ranked
firM in the
financial institution clients
25
+
consultants specializing in hr, it, succession planning and business operations solutions
100
50
+
different certifications
+ combined years of
financial institution experience among partners
Financial inStitUtion leaderShip
from industry thought leadership on governance and risk management, to proactive and grounded assurance and accounting guidance, McM’s financial institutions partner leadership will meet your bank’s needs. lee Groza, cpa partner louisville, kentucky lee.groza@mcmcpa.com
henry hawkins, cpa financial institutions services director henry.hawkins@mcmcpa.com
www.mcmcpa.com | 888.587.1719
debbie Smith, cpa partner lexington, kentucky debbie.smith@mcmcpa.com
Expert guidance, beyond the bottom line.
KENTUCKY BANKER
125
FNB Donates to the Murray and Calloway County Schools’ Family Resource Centers Mayfield, KY — FNB Bank donated $3,100 to the Family Resource Centers of Murray Independent Schools and Calloway County Schools as a result of the bank’s 2016 philanthropy efforts in Murray-Calloway County. Fundraising dollars will provide support for the holiday assistance programs; the Laker Christmas Santa Project and Tiger Christmas. In addition, the money will be used for fulfilling basic needs, family assistance efforts, providing clothing/shoes and so much more. FNB employees coordinated and participated in numerous fundraising events benefiting the Family Resource Centers throughout 2016, including various jean days and an August Cookout. In addition, FNB employees from the Murray Office assisted with serving meals during the Summer Feeding in the Park program, providing a “personal” shopper for new school clothes at the First Loves Murray event, as well as distributing school supplies at the Back to School Blast. “We are honored to be able to fundraise and volunteer year after year for the family resource centers at both school systems,” stated Angelique Starks, FNB’s Murray Office Manager. “What they do for the families in our community is truly inspiring.”
When it comes to the banking industry, KraftCPAs has the bases covered. Serving the banking industry for more than 50 years. - external & internal audit Contacts: Beverly Horner Member Financial Institutions Team 615-346-2431
Michael Davis Member Financial Institutions Team 615-346-2487
Gina Pruitt Member Risk Assurance & Advisory Services 615-782-4207
compliance reviews SOX documentation & testing tax planning & compliance loan reviews & grading systems employee benefit plan audits merger/acquisition assistance valuation services
- FFIEC audits - risk assurance & advisory services -
IT risk assessment & audits enterprise risk management (ERP) social engineering forensic accounting network vulnerability & penetration testing
www.kraftcpas.com/banking.htm
KENTUCKY BANKER
125
Brute Force Attack Fraud Attempts Starting to Reappear by Liz Little, The Shazam Network Is the attack back? After a lull during the first half of 2016, the number of attempted brute force attack fraud cases is on the rise once again. A brute force attack happens when a fraudster has a cardholder’s information. They might have the card number, expiration date and PIN. Most of the information is gathered through phishing the cardholder for information to help perpetrate the attack.
A second important component to that temporary block is an alert to the cardholder. A simple heads-up via cellphone or email can head off a brute force attack before the fraudsters get the information they’re after. But, what if the cardholder can’t be reached right away to get the problem resolved? Can the fraudsters just count down the minutes until the expiration time and resume their criminal activity? That’s why there’s the need for a third important component: An extension of the original temporary card block. An extension of the block should remain in place until it’s physically removed. Think of it as an additional preventative measure.
But the fraudster is missing one key element: The three-digit CVV code on the back of the card. The criminals then use a computer to generate fake card-present transactions, mostly in low dollar amounts. They use bogus retailer names and The good news about these attacks is, despite the uptick, hope to guess the right CVV code. none of them were successful here. That’s because more monitoring is being done to protect the cardholder from Once a processor sends back an approval, they know they’ve these criminals. One thing is for certain, the brute force atgot the right CVV code and they can manufacture a coun- tack trend comes and goes. A layered approach to security terfeit card and get cash out of an ATM. In 2016, the num- safeguards can ensure that, even when an old attack comes ber of attempted brute force attacks SHAZAM detected on back, you’re ready. our own network nearly tripled in 10 months. The SHAZAM Network, founded in 1976, is a national So, if this type of attack is back, it’s time to brush up on member-owned and controlled financial services and paysome old, but helpful security habits. First, make sure your ments processing company. SHAZAM is a single-source proprocessor is limiting the number of failed attempts for an vider of the following services: debit card, core, fraud, ATM, invalid CVV. If an attacker is just guessing, a temporary merchant, marketing, training, risk and automated clearing block can give the processor and cardholder time to realize house (ACH). To learn more, visit shazam.net and follow their information is at risk. @SHAZAMNetwork.
26 KENTUCKY BANKER | DECEMBER 2016
KENTUCKY BANKER
125
Cyber Fraud Prevention: Wiring Tips by Jon Biggs, VP Director of Risk Management & Education Investors Title Insurance
Sending a Wire... In the age of technology, everyone wants instant gratification. Receipt of proceeds isn’t any different – “Send it to me now!” Did you know, once a wire is sent it can easily be withdrawn from the recipient bank account and sent out of the country? Once it is out of the Federal Reserve System, there is no way to recall or retrieve the wire. Are you sure the client does not want a check? If a wire is required, below is a list of steps one should take to prevent wire fraud. Proper Identification: Before receiving wiring instructions, contact the sender through an independently verified phone number to identify the recipient and the recipient’s contact information. Record the following: 1) the name of person you talked to 2) the time of call or inquiry 3) the recipients information they provided If the sender calls you first, you should still call the sender at the previously identified number to confirm that the person who called you was the person he claimed to be and that wire instructions received are correct. Verbal Confirmation: Upon receipt of wiring instructions, before wiring funds, call the recipient to verify wiring instructions. Keep a record of: 1) the person you called 2) the number called 3) the time called Delivery Verification: After wiring the funds, call the recipient to confirm receipt of the wire in their account. Keep a record of: 1) the person you called 2) the number called 3) the time called
Proper Identification: Before sending wire instructions, confirm with the person who will be sending funds the identity of the person or institution which will actually be wiring the funds. Get a contact number for the person or institution that will be wiring funds upon receipt of instructions. Only forward wire instructions to your client or person designated by your client that will actually be wiring the funds to your account. DO NOT relay wire instructions through third parties (e.g., real estate agent) that may forward unencrypted instructions. Verbal Confirmation: Instruct the verified sender to call your office and confirm receipt of the wire. This way you will know when the wire was sent and they will know it was received. If there is a problem, you will find out sooner rather than later. Delivery Verification: Once wire instructions are sent, call the recipient and verify intact receipt of instructions sent. Keep a record of: 1) the person you called 2) the number called 3) the time called
Wire Instructions Myths... 1. “I received wiring instructions through an encrypted email from a name I recognize so I am good to go.” MYTH! Wiring instructions sent through encrypted emails does not mean they are legitimate. Cyber criminals can send through encrypted email using a similar domain or spoof address. Always verify the contact and source, paying attention to the domain name after the ‘@’ symbol – gnail.com instead of gmail.com makes all the difference. 2. “These wiring instructions were sent by fax from a number I recognize…these are ok to use.” MYTH! Wiring instructions sent through a facsimile communication can be an attempt at fraud. Cyber criminals have the ability to alter the sender line in a fax, making it appear as if it came from your client. Always verify the contact and source. 3. “I only confirm wiring instructions when changes are submitted” MYTH! You need to confirm wring instructions every time, not just when they are changed.
Receiving a Wire...
Red Flags...
You should never send wiring instructions by unencrypted email. Use encrypted email (entire email encrypted, not just attachments), landline fax machine, postal service (USPS), overnight delivery service, or hand delivery.
Red Flags are not absolute rules, but rather an indication that there may be something out of order with the wiring instructions. There may be reasons for the Red Flags that, upon proper investigation, may be very legitimate. continued on page 29
DECEMBER 2016 | KENTUCKY BANKER 27
KENTUCKY BANKER
125
What separates our assessments from an ordinary audit? by SDGblue’s Senior Security Analyst, Michael Gilliam Typical audit firms perform an audit in a true sense of the word. The types of common details and findings indicate that they use the “Examine” and “Interview” method to perform their audit of security controls. This is useful in finding high level gaps in security controls - such as a missing control or an area where there might be a potential issue with a control. For instance, if you are missing a patch management solution or if a procedural gap is identified during an interview, you might be able to make high level improvements to the internal patch management process. These typical firms, however, do not measure how effective your patch management program is (providing concrete numbers) or tell you what makes an effective Vulnerability and Patch Management program that will make you secure over time. This is something SDGblue strives to do in its work - provide you details and recommendations to help you optimize your current security controls and get the most value (security) out of the tools you already have invested in. We include the “Test” method in our reviews to determine the effectiveness of security controls. SDGblue is committed to improving our clients security posture, so we have the privilege of seeing the importance of technically verifying security controls time and time again. We often ask IT staff about patch management (or other security controls) during our reviews and we are usually provided arbitrary numbers of effectiveness (say 90% of patches are deployed).
We then use our methods to “Test” the effectiveness of the control, and oftentimes find that the result is much different than the current belief of those being interviewed. It is not an issue of the client being deceptive, but rather a lack of understanding of what makes the security control effective. What makes a security control effective? In our experience, there are three things that make a security control effective: 1. People 2. Processes 3. Technology By using the “Test” method to technically verify security controls, we can highlight which control is weak and make recommendations to improve it. This ensures that the control will be improved in its current state, and will continue to be effective over time. Our reports are full of technical details of actual vulnerabilities, configuration issues, and recommendations to help security controls realize their full potential of effectiveness.
For more information: www.sdgblue.com 859.263.7344
continued: Cyber Fraud Prevention Wiring Tips However, you should look out for the following and investigate each instance of a Red Flags when it is discovered. Below is not an all inclusive list, rather some of the more prevalent Red Flags. 1. Wires to be sent outside of the United States 2. Changes in wiring instructions (Very few individuals or corporations change their bank accounts in the middle of a transaction. Be very suspicious of changes in wiring instructions) 3. Similar but slightly different email address (Many cyber criminals will attempt to defraud you by communicating with a very similar but slightly different email address) 4. Wire to a different geographic location than recipient’s 5. Wire to account which is not in the name of the recipient 6. Individual wire sent to corporate account
7. Corporate wire sent to individual account 8. Broken English (Many cyber criminals are outside of the United States and English may not be their first language not an absolute, but worth checking out) 9. Unnecessary speed requirements or demands (Everyone understands the desire to receive their money from a third party, but extraordinary pressure for the speed of the wire is generally a sign that they do not want you to investigate) In the age of technology, it is critical to have a cyber and wire fraud prevention plan. Also, and equally important, ensure everyone is trained and follows the plan so your clients, your employees, and your company or firm are not compromised. Visit https://www.invtitle.com/wire to view or download Investors Title’s W.I.R.E Brochure and W.I.R.E. Checklist. DECEMBER 2016 | KENTUCKY BANKER 29
KENTUCKY BANKER
125
BANKERS ON THE MOVE Tommy Hawkins
Chris Tobe
First Southern National Bank is pleased to announce its recent hire of Tommy Hawkins. Hawkins will serve in a Loan and Business Development role and has 41 years experience in the banking industry.
First Bankers Trust Company, a division of Town & Country Bank and Trust of Bardstown, is pleased to announce the recent hire of Chris Tobe as Vice President and Investment Advisor. Tobe has over 25 years experience in investments and is the author of two investment books. He holds an MBA in Finance from Indiana University Bloomington and a BA in Economics from Tulane.
Laura Martin
Paula Scott
Bank of the Bluegrass & Trust Co. would like to announce the promotion of Laura Martin to Assistant Vice President. Martin has been with Bank of the Bluegrass & Trust Co. since 2008.
Bank of the Bluegrass & Trust Co. would like to announce the promotion of Paula Scott to Vice President. Scott joined the bank back in 1987 as a teller and will be celebrating her 29th anniversary next September.
Audrey Lillpop
Dayne Higginbotham
First Security Bank is pleased to announce the promotion of Audrey Lillpop to Assistant Vice President / Treasury Management Officer. Lillpop has been with the bank since 2010 and has a BS from Bellarmine University and a Masters degree from Brescia University. Lillpop is also a graduate of the Kentucky Bankers Association’s General Banking School.
First Security Bank is pleased to announce the promotion of Dayne Higginbotham to Assistant Vice President/ Commercial Banker. Higginbotham is a graduate of Eastern Kentucky University and the Kentucky Bankers Association’s General Banking School.
Kevin Roark
Tyler Cain
First Security Bank is pleased to announce the promotion of Kevin Roark to Vice President/Commercial Banker. Roark joined the bank in 2010 and is a graduate from Western Kentucky University.
First Southern National Bank is pleased to announce the promotion of Tyler Cain to Community President. Cain has served the bank in a Loan and Business Development role since 2012. Cain is a graduate of Eastern Kentucky University.
Matt Hale
Shawn Heck
Alexander Thompson Arnold would like to announce that Matt Hale has joined their team as Partner. Hale comes to ATA through a merger with Matt Hale CPA.
Kentucky Farmers Bank is pleased to announce the promotion of Shawn Heck to President. Heck had previously served as Chief Financial Officer at the bank. He has been with Kentucky Farmers Bank for over 20 yers.
SEND YOUR SUBMISSIONS FOR
BANKERS ON THE MOVE TO ANGIE WHITE awhite@kybanks.com
30 KENTUCKY BANKER | DECEMBER 2016
David Michael Citizens Bank of Kentucky is pleased to announce that David Michael has joined the bank as Senior Vice President and CFO. Michael has over 25 years of experience in the industry and is a graduate of Morehead State University.
KENTUCKY BANKER
125
BANKERS ON THE MOVE Joan Patterson
Jodie Hansen
Central Bank is pleased to announce that Joan Patterson has joined the bank as Cash Management Officer. Patterson has 30 years of experience in the industry.
FNB Bank would like to announce the promotion of Jodie Hansen to Assistant Vice President. Hansen has been with the bank since 2010 and is a graduate from Southern Illinois University at Carbondale.
Andrea Vinson
Carolyn Todd
First Citizens Bank would like to announce the promotion of Andrea Vinson to Branch Administrator. Vinson has been with the bank since 2005.
FNB Bank would like to announce the promotion of Carolyn Todd to Assistant Vice President. Todd is a graduate from Murray State University.
PBK Bank Celebrating 110 Years 1906-2016
Stanford, KY — PBK Bank opened their doors in 1906 as the People’s Bank of Hustonville. Since that day, they have continued to grow. While the name has changed and there are now six locations in three counties, their goal is still the same, building better communities.
To celebrate, PBK Bank hosted an event open to the public on August 20th at the local fairgrounds in Lincoln County. There were hamburgers cooked by the Lincoln County Cattleman’s Association, wonderful side dishes prepared by Durham’s Grocery, inflatables, cotton candy and sno cones to keep the party going. Games of bingo and corn hole were enjoyed. There was also something for everyone to take home at the end of the day. Let’s not forget the cake, you can’t celebrate without it! It was a great day to come together and be thankful for the last 110 years and looking forward to the next 110 to come. DECEMBER 2016 | KENTUCKY BANKER 31
KENTUCKY BANKER
125
The Rising Risk of Ransomware I get a lot of questions regarding the hot topic of ransomware. While I am not aware of a Kentucky bank that has been affected, my contemporaries in other states tell me they have had client banks who have been. This is a timely article by a good friend. If you have questions regarding coverage and breach response services for these type of attacks, feel free to give me a shout. Chuck Maggard, President & CEO KenBanc/KBA Insurance Solutions cmaggard@kybanks.com by Craig M. Collins, OneBeacon Financial Services & Joe Budzyn, OneBeacon Technology Insurance Ransomware is the latest cyber extortion tool devised to threaten both businesses and individuals. Having affected financial institutions, hospitals and many other types of organizations, ransomware has been featured prominently in the news over the past few years. In 2015 alone, the Federal Bureau of Investigation (FBI) reported 2,400 ransomware-related complaints totaling a loss of more than $24 million. While some affected have paid the ransom and recovered their computer data, others have lost theirs forever. What is ransomware, and how can banks protect themselves against this formidable risk? How It Works: Similar to a virus, ransomware is malicious software that infects a computer. It can arrive via several mechanisms: a malicious email attachment, embedded in a malicious website download, attached to a phishing email, or even a web link that automatically downloads the ransomware when it is clicked. Once a user’s files and documents are encrypted, they become inaccessible until a ransom is paid. A user is instructed to pay ransom within a certain timeframe and through a method that is fairly convenient yet difficult to trace back to criminals. This may include wire transfers, pre-paid payment cards, Bitcoin or premium cost SMS services. While criminals say they will provide the user a decryption key necessary to recover their files, there is no guarantee that data will be recovered after the ransom is paid. Additionally, paying the ransom does not prevent future infection with the same or different ransomware and the cycle repeating. Another type of ransomware locks a user’s device to prevent its usage. The lock message often accuses the user of a crime and appears to come from a branch of law enforcement. The files may not be encrypted during this attack. If the lock screen ransomware is removed, the files are typically untouched. The Damaging Impacts: While everyone is at risk for ransomware, banks are particularly attractive targets. Criminals recognize that financial institutions maintain a bevy of personally
identifiable information and have the funds to pay a potentially lucrative ransom. Beyond losing their files, banks that fall victim to ransomware can face monetary and business interruption losses, legal and IT service fees, lack of employee productivity and most importantly – compliance and reputational risks. Mitigating Risks: The most effective defense against ransomware is prevention, and banks must take precautionary measures to protect themselves and their customers. Back Up Data: An extremely important process is to back up important data daily. This backup should be offline and disconnected from the computer, as some versions of ransomware can encrypt data stored on network drives or in cloud services when they are connected to the infected computer. The recovery function of your backup/restore procedure should be tested regularly. Effectively backing up current data will leave banks less vulnerable to the threat of ransomware. Even if a computer is locked, a bank won’t be forced to pay to recover its data. Train Employees: Ransomware phishing attacks can come through in the form of an email with a malicious attachment or URL. It is important for employees to be vigilant of such attacks. To help raise security awareness, consider sending simulated phishing attacks to keep employees on their toes and help them recognize what a phishing attempt might look like. Advise employees not to click on links or open attachments or emails from those they do not regularly do business with. Use Superior Security Technology: Even with proper training, employees may open an attachment or visit an infected site. That is why it is necessary for banks to take other standard security technology measures such as ensuring a firewall is in place. Anti-virus software should be used to detect and prevent infection, while web and email filtering software should be used to reduce exposure. It is important to apply security patches and regularly update all security software. Segregate Access: Managing user access to data can lessen the risk of a successful ransomware attack. The number of employees with administrative access should be limited, and access should not be assigned unless absolutely necessary. Employees should only have access to the files or directories that are relevant to their job functions. Networks and data should be separated for each organizational unit. In the Case of an Attack: Despite a bank’s best efforts to protect against ransomware, an incident may still occur. If it does, both the FBI and the Federal Financial Institutions Examination Council (FFIEC) encourage ransomware victims to notify law enforcement immediately. Law enforcement officials, such as the continued at the bottom of the following page
32 KENTUCKY BANKER | DECEMBER 2016
KENTUCKY BANKER
125
How to Manage your Accounts Receivables in 2017
Have you checked out APR’s YouTube Channel or their blog lately? They have many answers to the questions common with collections, and tips to improve your bottom line. Do you want more tips on improving cash flow? And did you ever wonder what trained, reputable collectors go through? After all, they are calling on your behalf. On APR’s YouTube Channel and their blog you can find the answers for many of these questions as well as get a glimpse into what makes American Profit Recovery an award-winning collection agency. Meet their people, and see what drives them to work hard for KBA members every day. Subscribe to APR’s YouTube Channel at this link: https:// American Profit Recovery can help with customer retention www.youtube.com/user/AmericanProfit and take a few and increasing non-interest fee revenues! APR is a long minutes to scan their blog at this link: https://www.ameristanding KBA endorsed company specializing in recovery canprofit.net/blog/ -- APR has many topics they know will of DDA charge-off accounts. They help our members to help you improve your bottom line. increase cash flow, reduce some internal time and effort, and they take a diplomatic approach which helps retain Need a fresh look at your customers as opposed to losing them down the street! They accounts receivable in 2017? have a simple but effective service that helps our members Contact Selina Parrish and we encourage you to take a look at what they can offer (502) 736-1282 your financial institution. APR’s on-line customer interface sparrish@kybanks.com makes it even easier to manage your accounts and provides real-time reporting. When you are hiring anyone to help your business, you want to know they have the expertise in your industry and that’s exactly what your financial institution gets when you bring on American Profit Recovery for all your debt collection needs.
continued: The Rising Risk of Ransomware FBI, can assist in determining whether or not it is in the bank’s best interest to pay the ransom. In addition, the FFIEC recommends notifying the appropriate bank regulatory authority of any ransomware incident, and possibly filing a Suspicious Activity Report. Banks may also file a notice of a ransomware incident on the FBI’s Internet Crime Complaint Center at www.ic3.gov. A Costly Crime: Ransomware is a rising threat for U.S. businesses as an increasing number of cyber criminals adapt it as their newest method of extortion. According to the FBI, these criminals collected $209 million in the first quarter of 2016 – which puts ransomware on pace to be a $1 billion crime in 2016. Banks must take preventative measures to avoid falling victim to a ransomware scheme and suffering potentially irreparable losses.
Craig M. Collins is President at OneBeacon Financial Services. He has 30+ years of experience in the financial institution industry. Collins can be reached at ccollins@onebeacon.com. To learn more about OneBeacon Financial Services, visit onebeaconfs.com Joe Budzyn is VP & Senior InfoTech Product Manager at OneBeacon Technology Insurance. His 20+ years of experience include positions in network infrastructure and security. Joe can be reached at jbudzyn@onebeacon.com. To learn more about OneBeacon Technology Insurance, visit onebeacontech.com
DECEMBER 2016 | KENTUCKY BANKER 33
KENTUCKY BANKER
125
2017 EDUCATION CALENDAR KBA Consumer Lending School January 18 & 19 Louisville
Bond University February 24 Louisville
KBA Spring Conference
KBA/PBS Compliance School Feb 27 – Mar 3 Louisville
KBA General Banking School
Business Continuity Planning March 2 Madisonville March 3 Lexington
KBA Commercial Lending School
Supervisors Boot Camp March 14 -16 Louisville
April 17 – 19 Lexington June 11 – 16 Louisville
August 7 – 11 Louisville
2017 PBS LIVE SEMINARS
Bank Security Seminar April 13 Louisville
Appraisal Compliance Review Identifying Common Mistakes May 18 Lexington Regulators Forum June 22 Lexington June 23 Bowling Green Enterprise Risk Management July 19 Louisville SBS Certified Banking Cybersecurity Manager School July 25 & 26 Louisville
PEGASUS EDUCATIONAL SERVICES
Feb 27–Mar 3 PBS Compliance School Louisville BSA/AML Compliance Management Mar 1 – 3 PBS Compliance School Jan 10 Elizabethtown Louisville Jan 12 Bowling Green Mar 28 Managing Fair Lending Risk Jan 17 Paintsville Lexington Jan 18 Somerset Mar 29 Mastering HMDA Transitioning to the New Rules Jan 19 Paducah Mar 30 CRA Compliance for Community Banks Jan 24 Lexington Lexington May 16 Managing Fair Lending Risk In-Bank Training Workshop Bowling Green Feb 7 Paducah May 17 Mastering HMDA: Transitioning to the New Rules Feb 8 Elizabethtown Bowling Green May 18 CRA Compliance for Community Banks Business Account Bowling Green Administration in Kentucky Jun 5 Loan Products Workshop Mar 20 Paducah Lexington Mar 21 Bowling Green Jun 6 – 8 Real Estate Lending Compliance Mar 22 Elizabethtown Lexington Mar 23 Lexington Sept 12 IRA Rules and Regulations/Basic Issues Lexington BSA/AML Compliance School Sept 13 IRA Rules and Regulations May 9 – 10 Lexington Intermediate/Advanced Issues Lexington Deposit Compliance Fundamentals Nov 1 ACH Processing Compliance Aug 8 Paducah Louisville Aug 9 Bowling Green Nov 3 ACH Processing Compliance Aug 10 Somerset Bowling Green Aug 22 Elizabethtown Nov 9 ACH Processing Compliance Aug 24 Lexington Lexington 34 KENTUCKY BANKER | DECEMBER 2016
DECEMBER 2016 | KENTUCKY BANKER 35
T
ESTIMONIAL: “My time at the KBA Essentials of Banking School was a truly great experience. I gained so much knowledge of the banking industry as a whole and made many great friends along the way. I cannot say enough positive things about the KBA staff! They were so nice and caring and it was evident that the instructors were very knowledgeable in their given areas. I personally think that every bank should send as many employees as possible to this great program. It is beneficial to anyone that works in the banking industry. Thank you KBA for a wonderful learning experience!� Lindsey Crump, General Ledger Department, Peoples Bank of Kentucky, Flemingsburg
ESSENTIALS OF BANKING SCHOOL
2016 EBS ATTENDEES: Kaitlyn Adams, Becky Anderson, Frank Baker, Tess Bechel, Chad Byron, Adam Christy, Lindsey Crump, Elizabeth Davenport, Zachary Engle, Amanda Flowers, Courtney Hornback, Michael Houchens, Lynn Hunt, Michelle Ivey, Janet Lewis, Michele Luksic, Marra McMillan, Brandi Moore, Brenda Owens, Jennifer Rutter, Royetta Smith, Susan Sydenstricker, Aimee Thorn, Sarah Washburn, Misty Wells, Megan White.