Follow-up on the Vancity crisis

 

After I wrote this email to the Vancity board on Thursday, we endured two more days of a system outage. As a brief summary of what ensued:

Late in the afternoon on Friday (40 or so hours after the outage started), the CEO released a hastily-recorded video repeating the talking points that the social media team had been using, and still refusing to give any further information on what was going on. That video has since been deleted from their YouTube account.

Friday evening I got the following email in response to my earlier email, addressed to me from a staff member – still no word from the board itself at this point. Note the word “inconvenience,” which will continue to be used throughout this process. This appears to be the beginning of management and the board gaslighting us into believing that this is a mere triviality, rather than a failure of the entire banking system at our credit union.

Dear Neal,

On behalf of the Board of Directors, thank you for taking the time to write. We understand your frustration and apologize for the inconvenience and stress that our online banking system outage and its impacts are causing you. Please know that we are doing our utmost to resolve what has been a difficult few days for all Vancity members and employees.

Your points are well taken. As an organization, we want nothing more than to explain what has caused the technical problems we have experienced these past few days, to resolve those problems, and to communicate to our members precisely what steps we are taking to address their concerns.

Unfortunately, we just aren’t there yet.

You can be assured that all of us–everyone across the organization–are working on a solution. Our first priority is to have the system returned to its proper functioning capacity. As we do that, we are also working closely with our members to make sure their needs are being met.

Part of the effort means standing up and taking accountability. Our president and CEO, Tamara Vrooman, and the rest of our senior executive team have this top of mind. They have been working with our technical team and partners in an effort to repair the system and return it to its normal operating condition.

Tamara has also been responding to media inquiries, getting important messages and updates to the membership and the public at large. She wants everyone to know that we have ruled out a privacy or security breach and that we understand what this outage means for our members. She has also participated in a video message, which you can find here: https://www.vancity.com/AboutVancity/ServiceDisruption/

All of our branches will be open each day this weekend, including Thanksgiving Monday, from 9:30AM to 3:00PM. Our Member Services Centre will be open to serve you from 8:00AM to 8:00PM each day.

Again, we thank you for your letter, and we hope that we can continue this dialogue, and to serve you in the manner you deserve.

Regards,

Lara

Lara Hamburg
Board Liaison
Office of the CEO
183 Terminal Ave
Vancouver, BC V6A 4G2

I responded with the following:

Lara, and Board, with a copy now to the Financial Institutions Commission,

This communication (this email and the video from the CEO) all came too late – and is thoroughly incomplete. “We don’t know what’s going on” 40 hours into an outage is not a good enough answer. And suggesting that the fact that the CEO has been talking to media is evidence of proper communication ignores the fact that members trying to get information – from our website, from our social media platforms, and so on – have been told less than the media has. The public relations campaign thrown together in a rush this afternoon is not a substitute for effective communication with members.

I sincerely hope that, as the board liaison, you are not filtering messages to the board. Board members need to know that Vancity members are not happy with them or the management they are supervising, and they need to hear our specific concerns. The technical outage has so far been an unmitigated disaster, but the response from the board (which is nonexistent – I do not consider a form email from staff to be even close to a communication from the board) and from management is nothing less than offensive. I sincerely hope that there are severe repercussions for the staff and board members responsible for this fiasco.

I, personally, have gone from “I am upset at the outage and lack of communication” to “I have lost all trust in this institution and fear for whether I will ever be able to access my money again.” The fact that almost two full days later we have not been provided with even an estimate of when we will be able to access our funds again is shocking, and if we ever do get access again, I will be very quickly moving most of my own funds to a safer financial institution. I look forward to the next AGM where we can vote to replace the board of directors, too.

Members deserve better than this.

Sincerely,

Neal

I have yet to hear back on this email specifically.

Saturday morning I got frustrated and posed the following question to Vancity on the poorly-managed Facebook thread they had created:

The fact that they could not answer yes was, to say the least, terrifying. I posed a similar question on Twitter and was met with silence (though they did reply to other tweets). The eventual response (that’s cut off in the screen cap below) was notifying me that the system had been restored and came much later that day.

They also responded to this thread with more vague platitudes.

Around this time, I also followed up on my email back to Lara, but this time I copied the board chair directly – her email address is publicly listed on her website.

This follow-up is to the board, and the board only. We are now in day three, and staff are still not only unable to answer the question of when the system will be online, but they won’t even answer the question of IF the system will ever be back online (despite my repeated requests). This outage, and the uncertainty around it, puts our entire credit union at risk, and indeed the economy of our entire province if Vancity’s billions of dollars of assets have indeed vanished.

The board has remained completely silent on this matter for the last three days. It took until late yesterday for the CEO to say anything, and even then she said nothing of substance – this morning, it was more vague platitudes and we still do not know even what has gone wrong, let alone what is being done to fix it or whether it can be fixed at all. As a member, my only recourse is through the board, and I personally hold the board responsible. If the board is unwilling to at least communicate with members, let alone act, each member of the board should rethink their commitment to this credit union.

If there is not a satisfactory action from the board today, I will personally be petitioning my fellow members for a special general meeting to bring forward a motion to remove the board of directors and replace it with one that is actually willing to participate in the governance of this credit union. This goes well beyond the inconvenience of online banking – trust in the very foundation of our credit union has been eroded, and trust is the only thing that financial institutions truly deal in.

Sincerely,

Neal Jennings

So, long story short, we all spent three days wondering not just when, but if, we would ever be able to access our funds again, or whether this was simply the end of our credit union.

The CEO posted another message on Saturday which looked slightly more polished and was slightly more apologetic, but still provided absolutely no information about what was going on. By Saturday morning, the story was all over every single news outlet, which certainly doesn’t inspire confidence in me in the future of the credit union.

Around 4pm Saturday afternoon, the system was restored. With no warning, no “hey we found the problem and it’ll be back shortly,” just a new message:

This was soon followed by another video from the CEO, which is still available on Vancity’s channel:

Note the continuation of the “inconvenience” language.

Later that evening I got this bit of copypasta from the board chair:

The thing I found most remarkable about this email, besides the fact that it was clearly and poorly forwarded, was that there was neither an apology nor any acknowledgement of the complete failure of communications. Indeed, she commended the communications in this email, along with the CEO addressing media, which I find shocking. I have no disagreement that staff did an amazing job with the very few resources they were provided with – they did, and I’m certain that all the front-line staff have done heroic work to hold things together as much as possible despite complete lack of any support from management or the board.

I responded with an admittedly too off-the-cuff response:

I’m sorry, but apparently we experienced very different communications. In particular, your copypasta says: “In those updates, Tamara was candid, sharing what she and her team knew as the situation was unfolding.” That is not the case. The updates, which came at least a day too late, contained little of substance. Communications staff (who I do not blame for this problem) were unable to tell us what was wrong or even whether the system could ever be restored – I asked this question point blank several times and was met with meaningless jargon and/or silence. The statements from the CEO (who must share at least some of the blame for this problem) said little other than “we know this sucks but we don’t know what’s wrong and we’re working on it, don’t worry your information hasn’t been compromised.” These communications were insufficient at the very least.

The fact that you seem to think the communications were a-okay deeply offends me as a member. The fact that we still have not even been given a hint of why the system was offline for three days (even though you must know if you were able to fix it) is even more offensive. The board must be held responsible for this, and defending the actions of management and of the board rather than issuing a sincere apology says to me that you are not yet willing to accept responsibility. Let me be perfectly clear, this is not about the outage – this is about the lack of trust I and many other members now have that Vancity will be able to protect our money and make it available to us. The board has let us down.

Sunday mostly consisted of things settling down, and the poor social media team following up on every single comment and tweet to tell everyone that everything is working again and don’t worry our money is safe, and so on. I also got a call from my branch manager, who said “I was told you wanted to speak to a manager; I assume this is about the outage we’ve had”. I never made such a request, so I’m not sure who sent her to me or why, specifically. We had a good conversation, where I reiterated that this is not her fault and there’s nothing she can do about this, and where I once again made my points about this being a governance crisis and corporate head office problem, not a customer-service one. She repeated the same talking points I’ve seen in all the other communications, and asked if I incurred any specific costs (I hadn’t, thankfully, other than a few days of lost interest on deposits I couldn’t make, but I’m not petty enough to pursue that). I notified her that I’m still considering my options – I was, and still am, torn between trying to save Vancity by pushing for a complete replacement of the board (this can be done in accordance with provincial credit union laws) and simply leaving Vancity altogether.

And then, today, this:

The post is accompanied by a scripted YouTube video from the board chair:

My response was as follows (I reply-alled to my earlier off-the-cuff response from Saturday), and sums up my position at this stage:

Anita,

I want to follow up to this message. I received a phone call from my branch manager yesterday – I’m not sure if it was at your direction or someone else’s, but whoever sent her my way seems to have the misguided impression that this is a problem that can be handled through talking points and branch staff. I lay absolutely none of the blame at the hands of the staff or the branch managers – this problem goes all the way to the top. Forcing them to deal with the problem created by the corporate office is unfair to the staff that have already put in countless hours of overtime to clean up management’s mess.

I have read and watched the update you posted on our website tonight, and I think you’re failing to understand the seriousness of this problem. You, and all staff who are communicating with the public, continually refer to this outage as an “inconvenience.” This was not simply an inconvenience. There were three major things that happened here that completely undermine the trust I and many others have in the ability of Vancity to protect our assets:

• The system went down in the first place, as has happened many times over the last several years. This is an indication to me of major flaws in our IT systems development and planning, and I have yet to hear a clearly articulated plan from the board for how we plan to address this, despite the fact that it has been ongoing for years. This makes me believe that we are relying on a faulty system that may never work properly.
• There was no Plan B. Or, if there was a Plan B, it involved taking the entire system offline for three days with no warning. This is again a failure in planning at the corporate and board level – any organisation, but especially a financial institution, needs a disaster recovery plan to address problems like this. Failing to have one, again, makes me believe we are incapable of managing such a large amount of member money.
• Communications to members were of limited use. We were given vague platitudes for three days, and no one could tell us anything other than that there was no breach of data and that staff were working on fixing the problem, with no clear deadline for success. I asked on both Twitter and Facebook, point blank, whether we even knew for sure that the system would ever be back – that is, if it would be back, not when it would be back – and no one would give me an answer that wasn’t a repetition of the standard talking points. What this tells me, as a member, is that no one actually knew. I never want to be in a position where we simply don’t know whether or not our financial records and financial assets will ever be accessible again. Whether this was a failure in communications – you seem to think communications were fine – or such a significant failure in the system that truly no one knew whether or not the system would ever be revived, this completely undermines any trust I had in the organisation.

The entire banking system, and indeed the economy, relies on trust. Money is only good when we can trust that it has value. If it can be erased in the blink of an eye – as appears to have been the case this week – it is worthless. The fact that I, and many other members, cannot trust Vancity to protect our funds and make them accessible undermines the entire institution.

Finally, while I absolutely agree that members who were hit with any financial penalties as a result of this failure should be compensated, the use of the term “we” to mean the institution that is Vancity and the use of the term “you” to mean members (“we will make it right for you”) implies an us-and-them relationship, which is not how credit unions work. It’s not like all these costs will come out of the profits and dividends of third-party shareholders – we, the members of the credit union, will pay for these costs. They’ll be distributed in a fair an even way to ensure that those most negatively affected will be reimbursed and those who were not will share only our proportionate share of the costs, but ultimately it is the members who will pay for these things. The way the board and management are treating members as customers first and members second says a lot to me about the culture of this credit union.

I had initially resolved to petition to have the board removed, and replaced with one willing to accept the severity of the problem and take action to fix it, but frankly I don’t know if I have the energy for this. I may, ultimately, decide to withdraw as a member of Vancity altogether. Let me be very clear that this isn’t about incurring a late-payment penalty or not being able to bank at midnight on Friday. It’s about the fact that I cannot trust that this credit union is capable of maintaining basic financial services.

Sincerely,

Neal Jennings