“We’re not making a judgment on online betting; we simply can’t afford the write-offs”
Media Contact: Barbara Fornasiero; EAFocus Communications; firstname.lastname@example.org; 248.260.8466
Wyandotte, Mich. — March 9, 2021 — Well that didn’t take long. The State of Michigan allowed legal online gambling and sports betting on January 22, 2021 (following December 2019 legislation), and Michigan Legacy Credit Union (MLCU) is already seeing the negative financial impact on its members and ultimately the financial institution. That’s why, effective March 2, 2021, the credit union eliminated access of its institution’s credit and debit cards to all online gambling websites. The announcement was made by Carma Peters, President and CEO of Michigan Legacy Credit Union (MLCU).
“We are already seeing our members racking up debts through these online betting platforms that they can’t afford to pay back. We are not making a judgment on gambling or online betting; as a member-owned credit union, we simply can’t afford the write-offs from our institution’s credit and debit cards,” Peters said.
Members can still access cash at ATMs in casinos, but the home/mobile access to online betting is already showing signs of quickly surpassing physical casinos when it comes to spending beyond one’s limits. ATMs in casinos limit individual withdraws to the user’s available cash or daily limit, whichever option is less. However, online gambling sites allow debit/credit card users to go negative; if they do not have the ability to repay that negative balance, the credit union must then charge off the balance and take it as a loss.
“The act of walking up to an ATM in a casino means people have to think about withdrawing the money and authorizing the transactions,” Peters said. “While comparisons can be made to entering your debit or credit card into an online betting app or website, it is much easier to keep clicking away, unaware of the negative account status that may be building. I have a fiduciary responsibility to our member/owners. I can’t continue a practice that I know will compromise our credit union’s financial position.”
About Michigan Legacy Credit Union
Michigan Legacy Credit Union (MLCU) is a member-owned, not-for-profit financial cooperative serving members who live, work, worship, attend school, or own a business in the state of Michigan, with branches in Flat Rock, Garden City, Highland, Pontiac, Warren, and Wyandotte. Michigan Legacy Credit Union is committed to providing quality financial services at a competitive price, delivered professionally and efficiently while keeping member/owners and their needs first. For additional information on MLCU, visit: www.michiganlegacycu.org.